The COVID-19 National Emergency is over. What that means for COBRA, FSAs, and more.

President Biden signed legislation ending the COVID-19 National Emergency on April 10, 2023. The IRS and Department of Labor (DOL), however, have indicated informally that there is no change to the Outbreak Period set forth in the FAQs issued by DOL, Health and Human Services, and the Treasury Department on March 29, 2023, in which case the Outbreak Period would end on July 10, 2023.

From an employee benefits and COBRA perspective, this means that temporary extensions introduced during the COVID-19 pandemic will also expire. The end of the National Emergency also means other changes regarding your healthcare costs. We’ve compiled a few things you need to know. And check out our Benefits podcast episode with Jill Longo, director of compliance, health at WEX, below.*

COBRA

The end of the COVID-19 National Emergency ends the extensions first announced in EBSA Disaster Relief Notice 2020-01, which provided qualified beneficiaries and COBRA participants with more time to send certain notifications about COBRA coverage, to elect COBRA, and to make premium payments. The temporary extensions were retroactive to any deadline occurring March 1, 2020 until 60 days after the COVID-19 National Emergency is declared over (or another date announced by DOL, the Treasury Department, and IRS) or until one year has passed, whichever occurred first. 

You can learn more about the election period extension, grace period extension, and second qualifying event/disability notifications announced through that notice in this blog post. 

FSAs and HRAs

EBSA Disaster Relief Notice 2020-01 also granted a temporary extension to run-out periods for flexible spending accounts (FSAs) and health reimbursement arrangements (HRAs). The extension gives participants additional time to submit claims for any active plan year they are enrolled in that has a run-out period ending between March 1, 2020 and 60 days after the COVID-19 National Emergency is declared over (or another date announced by DOL, the Treasury Department, and IRS). 

You can learn more about the FSA and HRA run-out extension in this blog post. 

Telemedicine

Prior to the COVID-19 pandemic, Medicare enrollees in the most rural areas were the only ones who could use Medicare to cover telehealth appointments. The COVID-19 pandemic ushered in additional flexibility so all Medicare enrollees could, in many cases, receive coverage of telehealth costs as they would in-person appointments. The $1.7 trillion spending bill that President Biden signed into law in December 2022 included an additional two-year extension of these provisions, so Medicare telehealth coverage provisions will remain in place through 2024.

The $1.7 trillion spending bill also extended a provision that provided relief to health savings account (HSA) participants. HSA-qualifying health plans will continue to cover telehealth services on a pre-deductible basis through 2024. This flexibility was first provided as part of the 2020 CARES Act. 

Communication with employees is key when it comes to navigating these changes. “I think it’s very important to make these communications as early and as frequently as possible,” said Longo on our Benefits podcast. “Employers need to notify individuals when these deadlines are running out. So if a timeline is approaching and someone is almost to the point where they can no longer make COBRA election or where they’re going to miss out on being eligible for a benefit, like a claim to an FSA, the DOL strongly recommends communicating that to the participant.”

*This episode was recorded prior to President Biden signing legislation to seemingly end the COVID-19 National Emergency effective April 10, 2023. 

The information in this blog post is for educational purposes only. It is not legal or tax advice. For legal or tax advice, you should consult your own legal counsel, tax and investment advisers. 

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