Another HIPAA Special Enrollment Deadline Extension – What’s a Group Health Plan to Do?

Just when you thought the confusing COVID-19 ERISA deadline extensions were behind you, the Biden-Harris Administration asks you to reconsider. 

Recap – In response to the COVID-19 National Emergency, DOL and Treasury issued guidance requiring benefit plans to extend certain ERISA deadlines related to COBRA continuation coverage, HIPAA special enrollment, and benefit claims and appeals, effective March 1, 2020.  These deadline extensions generally expired on the earlier of: (1) July 10, 2023; and (2) one year from the date an individual first became eligible for the extension.   

Update – As noted in the CMS, Treasury, and DOL July 20, 2023 letter, the Biden-Harris Administration is calling on employers and plan sponsors to amend their group health plans to extend the 60-day special enrollment period required by HIPAA for individuals losing Medicaid and CHIP and ideally match the temporary special enrollment period on HealthCare.gov that runs from March 31, 2023 – July 31, 2024.  During the COVID-19 Public Health Emergency, Medicaid programs had to keep people continuously enrolled to receive enhanced federal funding.  Because this continuous enrollment provision ended March 31, 2023, millions of individuals are going to lose Medicaid and CHIP coverage.  Furthermore, because HHS estimates 3.8 million of these individuals will be eligible for employer sponsored coverage, the Biden-Harris Administration wants group health plans to help their employees maintain health coverage.

Five Considerations –

1. A plan sponsor does not have to extend its group health plan’s 60-day special enrollment period for loss of Medicaid and CHIP. 

2. If a plan sponsor decides not to extend this 60-day special enrollment window, it can take other steps to help its employees obtain health coverage such as telling them they can enroll in the group health plan within 60 days, reminding them about Medicaid and CHIP renewal, and encouraging them to enroll in coverage through the Exchange on HealthCare.gov.  CMS has provided an employer fact sheet for employers available here and a compilation of other resources here.

3. If a plan sponsor decides to extend its 60-day special enrollment period for loss of Medicaid and CHIP, it should amend its plan and/or issue a summary of modification (“SMM”) clarifying the terms of the special enrollment period.   For example, employers seeking to avoid adverse selection and to comply with the cafeteria plan rules that generally prohibit retroactive mid-year election changes should clarify that enrollment will be prospective and set an end date for the extended enrollment period.

4. As always, self-funded plans should seek approval of any changes from their stop-loss carrier, and insured plans from their insurer.

5. Once a plan sponsor makes a decision, it should notify participants and educate its benefits department so they can administer special enrollment on a uniform basis.