STILL WRANGLING COVID-19 NEWS – ERISA, ADA, FFCRA, AND NY

Posted On May 15, 2020  

by Marti Cardi, Esq. - Vice President, Product Compliance

May 15, 2020

 

Cowboy Radar

 

Every time I think I can write about something other than COVID-19, along comes another new law, regulation, or interpretation that I want to share with you. The roundup seems to be getting smaller, but the rodeo ain’t over yet, pardner. Saddle up, ’cause here are the latest:

ERISA Extensions of Disability Filing Deadlines

There are new deadlines in town. The Employee Benefits Security Administration (Department of Labor) and the Internal Revenue Service (Department of the Treasury) have issued a rule providing beneficiaries of certain ERISA plans with extra time to meet filing deadlines. Extensions are in place with respect to disability plans for claimants to file an initial claim for benefits and to appeal an adverse benefit determination.

ERISA rules do not provide a specific minimum timeframe that must be allowed for an individual to file an initial claim for disability benefits. See 29 C.F.R. § 2560.503-1. Rather, the timeframe is set by the plan. Now, a plan’s deadline for initiating a claim must be extended by the “Outbreak Period” explained below.

For adverse benefit determinations, the regular ERISA rules provide that a disability benefits plan must allow at least 180 days to appeal. 29 C.F.R. § 2560.503-1(h). This period too is now extended by the Outbreak Period.

The President declared a national emergency on March 13, 2020. For purposes of the new ERISA rules, this National Emergency is deemed to have started on March 1, 2020. The “Outbreak Period” is the time from March 1, 2020, until 60 days after the announced end of the National Emergency or such other date announced by EBSA and the IRS in a future notice. Counting to identify the deadline for an initial claim or an appeal of an adverse benefits determination must “disregard” the Outbreak Period. In other words, the time for filing is tolled for the duration of the Outbreak Period.

Here are some examples. For purposes of these examples we need an announced end date of the National Emergency and we will use April 30, 2020. The Outbreak Period ends 60 days later, on June 29.  

Example 1: Marie becomes disabled on March 15 and her employer’s disability plan allows her 30 days to file an initial claim for benefits, or until April 14 under the terms of the plan. However, since her disability occurred during the Outbreak Period, her 30 days to file a claim does not start until June 30. Marie has 30 days from that date, or until July 30, to file her claim.

Example 2: Donnie receives notification of an adverse benefit determination from his employer’s disability plan on January 28, 2020. The notification tells Donnie he has 180 days within which to file an appeal. However, the Outbreak Period is disregarded in calculating this 180 days. Donnie’s last day to file an appeal is 148 days after June 29 (180 minus the 32 days from January 28 to March 1), which is November 24, 2020.

This new rule applies retroactively. Because no time from March 1, 2020, through the end of the Outbreak Period counts toward a filing or appeal deadline, plan administrators will need to review any claim or appeal denials that occurred on or after March 1, and reverse any denial that is solely based on the claimant’s failure to meet the claim filing or appeal deadline.

What is Matrix doing? We are on top of this and ready to comply with the new deadlines. Specifically,

  • Matrix is implementing the new deadlines immediately for clients
    with self-funded ERISA disability plans
  • We are updating our denial letters to reflect the new information about
    the deadline to file an appeal
  • We will conduct an audit of ERISA claim denials and appeals upheld
    since March 1 for adverse determinations based on late filing and take
    steps necessary to correct those determinations.

If you have any questions, please contact your Matrix or Reliance Standard account manager.

NOTE: The new ERISA rules also affect claims for life and health benefits, health plan enrollment, and post-employment continuation of health coverage (COBRA). The Final Rule and supporting materials are available here: Final Rule, FAQs, and EBSA explanation of extensions.

 

ADA Guidance – The EEOC Continues Its COVID-19 Updates

Every few days the EEOC adds some new questions to its Technical Assistance Questions and Answers regarding COVID-19 and the ADA. The latest set provide guidance regarding employees with medical conditions that the Centers for Disease Control have identified as “high risk” – meaning that an individual with one of these conditions is at higher than average risk of developing severe illness from COVID-19. The conditions include chronic lung disease, moderate to severe asthma, serious heart conditions, compromised immune systems, severe obesity (body mass index [BMI] of 40 or higher), diabetes, chronic kidney disease, and liver disease. The EEOC addresses ADA issues and high-risk individuals in its new Questions G.3, G.4, and G.5. [Persons age 65 and older and those living in a nursing home or long-term care facility are also classified as high risk by the CDC but these are not ADA-protected disabilities.]

Individuals with high-risk medical conditions may request an accommodation to reduce the risk of exposure to COVID-19. As with all ADA requests, the employee does not need to mention the ADA or the word accommodation specifically, but merely has to make the employer aware that she needs a change in her work situation due to a medical condition. The employer may then ask questions or seek medical documentation to help decide if the individual has a disability and if there is a reasonable accommodation, barring undue hardship,that can be provided. Question G.3.

An employee with a high-risk disability who has never needed an accommodation may now need one as a result of the pandemic:

  • Due to a changed work environment, location, equipment, schedule, etc., and/or
  • To reduce the chance of exposure, if the employee is classified as high risk

Example: An employee with controlled diabetes normally functions at work without any accommodation, or with an accommodation not tied to COVID-19 (e.g., breaks for insulin monitoring and injections). Then, because the employee has a high risk disease, the employee requests an accommodation to reduce the risk of exposure, such as a separated work station or work from home.

So do what you always do: engage in the interactive process with the employee to see if you can meet her needs. The EEOC suggests the following accommodations to help minimize the risk of exposure (Question G.5.):

  • Additional or enhanced protective gowns, masks, gloves, or other gear
    beyond what the employer may generally provide to employees returning
    to its workplace
  • Additional or enhanced protective measures, such as erecting barriers or
    creating greater spacing between work areas
  • Elimination or substitution of the employee’s “marginal” job functions
  • Temporary modification of work schedules (if that decreases contact with
    coworkers and/or the public when on duty or commuting) or
  • Moving the location of where one performs work (for example, moving a
    person to the end of a production line rather than in the middle of it if
    that pro
    vides more social distancing).

The Job Accommodation Network (www.askjan.org) also may be able to assist in identifying possible accommodations. The EEOC encourages employers and employees to be creative and flexible. And employers, don’t worry about creating a “permanent” accommodation – the EEOC supports trial or temporary accommodations.

Finally, what about the employee who you know has a high-risk medical condition but doesn’t ask for an accommodation to reduce risk of exposure? Do you force the employee to stay home or accept other accommodations for his own good? Be careful there, cowboy. First, without a request for such an accommodation, you have no obligation to provide it. Second, that path requires an in-depth analysis to show that by working without appropriate accommodations, the employee poses a direct threat – a “significant risk of substantial harm” – to his own health. If you really want to follow this trail, read the EEOC’s Question G.4. for more guidance.

What is Matrix doing? Thanks to our already robust processes for managing ADA accommodations, Matrix has not had to make changes to provide our ADA clients with compliant accommodation services. However, our ADA Specialists have all been trained in the changing accommodation needs and analysis due to COVID-19. We’re here for you!

 

FFCRA – The DOL Adds More Questions & Answers

The latest set of Questions and Answers from the Department of Labor (#89-#93) includes a potpourri of topics. Here are the ones we find of greatest interest:

Employees from temporary agencies. Question #90 addresses how FFCRA paid leave rights apply to temporary workers when an employer (the “second employer”) has under 500 employees but the temporary agency has more than 500. In many temporary worker situations the second employer is a joint employer of the temp worker. In that case, in general, the second employer (under 500 employees) must provide the temporary worker with FFCRA rights and the temporary agency (more than 500 employees) must not interfere with the employee’s use of those rights to take leave of absence. But the determination of whether the second employer is a joint employer of the temp employee requires legal analysis of all the facts of the relationship. [Can you say, “Call my lawyer?”] And here’s an unanswered question: what do you pay the employee? The amount you pay through a temp agency probably includes the agency’s fee, so can you pay only what the employee actually pockets? And how do you handle tax and other withholding?

Wait, while you’ve got that lawyer on the line . . .

School closures – now and in the summer. Employers appear to be struggling with when an employee is entitled to the FFCRA emergency paid sick leave (EPSL) and/or expanded FMLA (EFML) due to a school or day care closure. Question #91 asks, What if my employee has been working at home for weeks with children present and now wants to take EPSL or EFML? Can I deny that? The DOL says, “not necessarily.” You need to ask questions about why the employee needs that leave now. Perhaps conditions at home have changed, or the employee is finding that he isn’t effective working with the kids at home 24/7. Or, the employee’s spouse has already used EPSL and EFML from her employer and now it is your employee’s turn. You can require that the employee to provide the information and documentation that is permitted under FFCRA and the IRS tax rules. You may also ask the employee to note any changed circumstances in his statement as part of explaining why the employee is unable to work, but the DOL warns, “you should exercise caution in doing so, lest it increase the likelihood that any decision denying leave based on that information is a prohibited act.” (I’m not really sure what that means but thought I would share the warning with you!)

And finally, the DOL answered my pending question about EFML and summertime! After a school closure due to COVID-19 and distance learning, your employee’s child’s school closes for summer vacation. Can your employee now take EPSL or EFMLA? Sorry, no. If the school closes for summer vacation or any other reasons not related to COVID-19, the benefits of FFCRA are not available. But, if the anticipated summer day care provider, summer camp,, etc., is closed or won’t open due to COVID-19, the employee may be able to use EPSL and/or EFML. Just have the employee follow the usual notice and documentation rules. (Question #93)

Also covered: FFCRA and casual domestic workers (Question #89) and permissible documentation for an employee taking leave to obtain testing (Question #92).

 

NY PFL – A new WCB Position on PFL for Child Quarantine

The new New York law providing paid quarantine/sick leave and related benefits has been a real challenge – a poorly written law rushed through with lots of unclear provisions and little high-level understanding of how it would work in reality. Recently the NY Workers Compensation Board, which administers the law, came out with a new interpretation of one of the benefits: a total flip-flop from its prior position. We previously summarized the law here and have kept that post up to date, including this change. But because the new interpretation affects employees of companies with 100 or more employees, we want to draw attention to it.

Under the law (as we thought it was written) employees of small companies (those with fewer than 100 employees) seeking paid sick leave (if any) provided by the law, could take NY Paid Family Leave for a new leave reason, to care for a child under an order of quarantine or isolation; but employees of large companies (those with 100 or more employees) did not have this entitlement. The WCB now says that was wrong, and employees of those larger companies can also take PFL for a child’s covered quarantine. If you thought riding that bucking bronco for the full 8 seconds was challenging, try your hand at trying to stay on top of the NY paid sick leave law! Yee haw! 

Next out of the chute!
At some point, COVID related questions and issues will subside – though probably not soon enough. Meanwhile the world turns and the sun rises and sets, and there are other laws, regulations and accommodations to be considered – in most cases, ones that will outlast the killing power of the coronavirus bug. Fortunately, we can multitask (which is good, because you have to, too!) and will be picking up our Legislative Update series with some good, ol’ fashioned, wholesome state Paid Family and Medical Leave updates on Thursday, May 28. So watch your email, and this space, for your invitation and registration link.
If you’d like a copy of our presentation or recorded webinar from last week’s update, you can click the links provided.

DOL ANNOUNCES ERISA DISABILITY CLAIMS HANDLING RULES WILL GO INTO EFFECT AS IS ON APRIL 1, 2018

Posted On January 08, 2018  

by Marti Cardi, Esq. - Vice President, Product Compliance

& Gail Cohen, Esq. - Director, Employment Law And Compliance

January 08, 2018

 

On Friday, January 5, 2018, the U.S. Department of labor issued a press release announcing that the Final Rule amending the regulations governing claims handling procedures for ERISA disability claims will go into effect on April 1, 2018, without changes from the original.  The Final Rule was originally issued by the DOL on December 16, 2016, with an effective date of January 1, 2018.  That effective date was postponed until April 1, 2018, in order to “solicit additional public input and examine regulatory alternatives” to the Final Rule.  The DOL accepted comments until December 11, 2017.   

The DOL press release states: 

The Department announced a 90-day delay of the applicability date of the final rule – from Jan. 1, 2018, through April 1, 2018 – to give stakeholders the opportunity to submit data and information on the costs and benefits of the final rule.   . . .

The information provided in the comments did not establish that the final rule imposes unnecessary regulatory burdens or significantly impairs workers’ access to disability insurance benefits.

We wrote in detail about the ERISA changes when the final Rule was first issued and provided suggestions for employer actions.  We urge you to read that post here.  Below we provide a brief recap of the changes.

  1. Independence and impartiality of claims adjudicators. Claims and appeals must
    be decided in a manner designed to ensure independence and impartiality of the
    persons involved in making the benefit determination. 
  2. Improvements to disclosure requirements. Benefit denial notices must contain the following:
  • A complete discussion of why the plan denied the claim and the standards
    applied in reaching the decision.
  • The basis for disagreeing with the views of health care or vocational
    professionals whose opinions were provided by the claimant or obtained at
    the behest of the plan.
  • The basis for disagreeing with a finding of “disability” by the Social Security
    Administration (SSA), if applicable.
  • The specific internal rules, guidelines, protocols, standards or other similar
    criteria of the plan relied upon in making the adverse determination or, alternatively,
    a statement that such guidelines etc. do not exist.
  • If the denial is based on a medical necessity or experimental treatment or similar
    exclusion or limit, either an explanation of the scientific or clinical judgment for the
    determination, or a statement that such explanation will be provided free of charge
    upon request.
  1. Claimant’s right to access entire claim file. An initial adverse benefits determination
    must contain a statement that the claimant is entitled to receive, upon request and
    without charge, the documents relevant to the claim for benefits.
     
  2. Notice of new or additional evidence or rationales before adjudication. A claimant
    must be notified of and provided an opportunity to respond to any new evidence or
    rationales developed by the plan during the pendency of the appeal.  However, the new
    regulations do not extend the time deadlines for the plan’s determination (45 days from
    the filing of the appeal, with a possible 45-day extension).
     
  3. Claimant is deemed to have exhausted administrative remedies if a plan fails to
    comply with claims procedure requirements.
    A claimant can seek court review of a
    claim denial based on a failure to exhaust administrative remedies under the plan if
    the plan failed to comply with the claims procedure requirements, unless a detailed
    exception applies.
  4. Expanded definition of “adverse benefit determination” that triggers
    appeals procedures.
    Under the new rule, rescissions of coverage, including retroactive
    terminations due to alleged misrepresentation of fact (e.g., errors in the application
    for coverage) must be treated as adverse benefit determinations, thereby triggering
    the plan’s appeals procedures.  Rescissions for non-payment of premiums are
    not covered by this provision.
     
  5. Notices and denials must be written in a “culturally and linguistically
    appropriate” manner.
    If a disability claimant’s address is in a county where 10
    percent or more of the population is literate only in the same non-English language,
    benefit denial notices must include a prominent statement in the relevant non-English
    language about the availability of language services.  Such services must include assistance
    with filing claims and appeals in the non-English language.  The plan must provide written
    notices in the applicable non-English language upon request.

What is Matrix Doing to Comply with the New Regulations?

Not to worry – Matrix’s disability claims handling procedures will embrace the new rules and will
continue to be best in class!  We will be ready to administer our clients’ disability plans in compliance
with the new regulations by April 1, 2018.  Indeed, we originally marched toward the January 1, 2018,
compliance date. 

If you have questions, please contact your account manager or practice leader, or send us an email at ping@matrixcos.com.

DOL ANNOUNCES 90-DAY DELAY OF ERISA DISABILITY CLAIMS RULES CHANGE

Posted On November 27, 2017  

by Marti Cardi, Esq. - Vice President, Product Compliance

& Gail Cohen, Esq. - Director, Employment Law And Compliance

November 27, 2017

 

On Friday the U.S. Department of Labor today announced a 90-day delay – from January 1 to April 1, 2018 – of the applicability date for ERISA plans to comply with the December 16, 2016, “Final Rule” amending the claims procedure requirements applicable to disability benefits.  As explained below, further delay of the applicability date beyond April 1 is not out of the question.  The official notice will be published in the Federal Register on November 29, 2017, but an unofficial version can be reviewed here. 

According to a press release issued by the DOL:

               . . .  [T]he delay of the applicability date announced is intended to give interested stakeholders theopportunity to submit, and for the Department to consider, data and information related to concernsby some insurance industry and employer groups, and some members of Congress, that the claimsprocedure amendments will drive up disability benefit plan costs, cause an increase in litigation and,in so doing, impair workers’ access to disability insurance benefits.

The DOL published a notice in the Federal Register on Oct. 12, 2017, seeking comments on the proposed 90-day delay of the applicability date of the Final Rule. That comment period ended on October 27 and on November 24 the DOL announced its adoption of the delay.  Also on October 12 the DOL also asked for comments that “provide data and information germane to a re-examination of the merits of repealing, replacing, modifying, or retaining the rule.”  That comment period ends on Dec. 11, 2017.  Comments can be submitted by clicking on the “Comment Now!” button at this link.

The 108 public comments in support of and in opposition to the 90-day delay can be reviewed here.  Some of the commenters expressed concern that a 90-day delay was not sufficient to allow the DOL to review and consider all data and comments submitted regarding whether any changes (other than the delay) should be made to the Final Rule.  According to the DOL, however:

       . . . [V]arious stakeholders made a commitment to provide such data and information to theDepartment.  . . .  If the Department receives such supporting data and information, the Departmentwill provide interested stakeholders with a reasonable opportunity for notice and comment on thatdata and information. Only at that point would the Department be in a position to seriously considerany further delay of some or all of the requirements of the Final Rule beyond April 1, 2018.

We will continue to watch for developments regarding this subject.  However, it took the DOL over four weeks to determine whether to extend the applicability date for 90 days.  Given the more substantive issues now pending regarding the Final Rule and the comment closure date of December 11, it is unlikely that the DOL will make any significant announcements no sooner than late January 2018 at best.

 What is Matrix Doing?  At Matrix we have been working diligently to prepare for the new rules.  Regardless of the outcome of the DOL review, Matrix will be ready to administer our clients’ disability plans in compliance with the new regulations by April 1, 2018, or other new effective date.  To this end, we have assembled a task force of experts in disability plans, claims handling procedures, ERISA, and customer service.  Our practice leaders and account managers will keep clients, producers, and others apprised of our work during the lead-up to the effective date – whatever it is!  If you have questions in the meantime, contact your account manager or sales representative, or send us an email at ping@matrixcos.com.

MORE ERISA: UPDATE ON THE DOL’S PROPOSED DELAY OF THE DISABILITY CLAIMS HANDLING RULES

Posted On November 03, 2017  

by Marti Cardi, Esq. - Vice President, Product Compliance

& Gail Cohen, Esq. - Director, Employment Law And Compliance

November 03, 2017

 

Hello, all you ERISA folks.  How many of you are losing sleep over the new ERISA rules for disability claims handling?  As we previously discussed here, the DOL has proposed delaying the effective date of these rules (the “Final Rule”), which are currently scheduled to go into effect for claims filed on or after January 1, 2018.  But, as we previously reported, the US Department of Labor announced that it is “reviewing these amendments for questions of law and policy” and solicited public comments on its proposal to delay the effective date of the Final rule by 90 days (until April 1, 2018).

The public comment period on this proposal ended on October 27, and today the DOL posted the 108 comments received.  They can be reviewed here.  Not surprisingly, comments from claimants and attorneys for claimants oppose the delay, and claims handling and insurance companies  favor the extension.

Also today, I had a discussion with a DOL representative working on this issue to inquire when we could expect the DOL’s decision on the delay.  I was unable to obtain any specific information (not surprised!) but received assurances that the DOL is aggressively reviewing and considering the comments received.  They are very aware that affected parties are waiting eagerly – or anxiously – for the ruling.  We will provide immediate updates of any new developments on this blog.

For a refresher on the requirements of the changes to ERISA disability claims handling requirements, as set forth in the Final Rule, review our prior blog post http://matrix-radar.com/blogs/2017/01/a-game-changer-ERISA-releases-new-ERISA-disability-claims-rules/.

Tired of reports on ERISA, NY Paid Family Leave, and all things California?  Check out our recent blog posts on other topics:

The Headless Horseman – An ADA Halloween Tale

Lucky Employer Skates on ADA Liability

7th Circuit Rules that Extended Leave is not a Reasonable ADA Accommodation

And feel free to suggest any FMLA, ADA, disability, or other absence management challenges as topics for future blog posts!

What is Matrix Doing?  At Matrix we have been working diligently to prepare for the new rules.  Regardless of the outcome of the DOL review, Matrix will be ready to administer our clients’ disability plans in compliance with the new regulations by January 1, 2018, or other new effective date.  To this end, we have assembled a task force of experts in disability plans, claims handling procedures, ERISA, and customer service.  Our practice leaders and account managers will keep clients, producers, and others apprised of our work during the lead-up to the effective date – whatever it is!  If you have questions in the meantime, contact your account manager or sales representative, or send us an email at ping@matrixcos.com.

DOL PROPOSES TO DELAY THE EFFECTIVE DATE OF ERISA DISABILITY CLAIMS HANDLING RULES AND SEEKS MORE PUBLIC COMMENT

Posted On October 10, 2017  

by Marti Cardi, Esq. - Vice President, Product Compliance

& Gail Cohen, Esq. - Director, Employment Law And Compliance

October 10, 2017

 

 

It’s a moving target, but we’re watching!  The amended ERISA disability claims handling rules  (the “Final Rule”) are set to go into effect for claims filed on or after January 1, 2018.  But, as we previously reported, the US Department of Labor announced in July that it is “reviewing these amendments for questions of law and policy.”  Today the DOL issued a Proposed Rule that will be published in the Federal Register on October 12, 2017.  You can read an advance copy of the Proposed Rule here.

The DOL proposes to delay the effective date of the ERISA disability claims handling rules by 90 days, to April 1, 2018 (some irony there).  The reason for the delay is to allow the DOL time to “solicit additional public input and examine regulatory alternatives” to the Final Rule.  Here are some important dates:

  • Comments on the proposal to extend the applicability date for 90 days must be submitted to the Department
    on or before October 27, 2017 (15 days after publication of the Proposed Rule in the Federal Register)
  • Comments providing data and otherwise germane to the examination of the merits of rescinding, modifying,
    or retaining the rule must be submitted to the Department on or before December 11, 2017
    (60 days after publication of the Proposed Rule in the Federal Register)

We will provide immediate updates of any new developments on our blog, http://matrix-radar.com/ – please sign up!

For a refresher on the changes to the ERISA disability claims handling requirements, as set forth in the Final Rule, review our prior blog post http://matrix-radar.com/2017/01/a-game-changer-dol-releases-new-erisa-disability-claims-rules/.

What is Matrix Doing?  At Matrix we have been working diligently to prepare for the new rules.  Regardless of the outcome of the DOL review, Matrix will be ready to administer our clients’ disability plans in compliance with the new regulations by January 1, 2018, or other new effective date.  To this end, we have assembled a task force of experts in disability plans, claims handling procedures, ERISA, and customer service.  Our practice leaders and account managers will be in touch with clients during the lead-up to the effective date – whenever it is! – to discuss changes to plan notifications, procedures, and more.  If you have questions in the meantime, contact your account manager or sales representative, or send us an email at ping@matrixcos.com.