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Deadlines Extended for Health FSA and HRA Plans Subject to Title I of ERISA

The Department of Labor, together with the Department of the Treasury, is extending deadlines for employee benefit plans subject to Title I of ERISA. The extension is part of the EBSA Disaster Relief Notice 2020-01 and the related final rule.

All ERISA employee benefit plans should disregard the period from March 1, 2020, until the end date of the “Outbreak Period” when determining the inclusive dates that individuals may file a benefit claim or an appeal. The runout and appeal periods for a health flexible savings account (FSA) or a health reimbursement arrangement (HRA) would be extended if that runout or appeal period ended after or extended beyond March 1, 2020.

The Outbreak Period is determined by the federal government and may differ by geographic location, which the DOL and the USDT acknowledged. Because of this, expect additional guidance regarding the relief to be announced in the EBSA Disaster Relief Notice 2020-01 and related final rule.

There is a minimum time period, but the guidance allows plans to provide individuals a longer period of time to submit claims or appeals.

Important Points to Consider in Making Decisions or Incorporate Changes into your 2019 Health FSAs and HRAs

* The following are based on the list compiled by the DOL.

Changes to plan documents

Any change made depends on how your documents are written. For hard dates communicated in documents, you may need to update the documents to accommodate the changes. You may also have a fiduciary obligation to disclose the extended deadlines.

Consult with your legal counsel to determine your or your employees’ plan document and fiduciary obligations.

New final filing dates

Communicate the new final filing date to participants as soon as possible. Work with your administrator for templates and how to update any announcement pages.

Extension of final filing date on plan design page

You can change this date after plan year has been configured. Determine how to best handle the new filing date since there is no “single” update required under the guidance.

Plans with runout dates after March 1, 2020, and before May 30, 2020, get an automatic extension on their final filing date until August 31, 2020.

With an undetermined end of the Outbreak Period, you can handle any necessary exceptions under release of final guidance.

You can handle any necessary exceptions upon release of final guidance.

Grace period

* Future guidance may have specific information on the period for incurring claims.

Closed plan years

A closed plan year for 2019 can be reopened. Alternatively, set a later date for closing 2019 plans to prevent them from automatically closing during the Outbreak Period.

HRA appeals

Language pertaining to your HRA appeals process may need to be updated.

Note: See instruction around this in your plan documents and denial letters. The need for changes depends on how your language is structured. Work with your legal counsel to determine exact changes.

Get expert HR and payroll assistance with your FSA and HRA plans and ensure accurate processing and compliance.

Contact Payroll Systems and let one of our payroll specialists walk you through our easy-to-scale solutions for your business.

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This article provides general information and shouldn’t be construed as legal or HR advice. Since employment laws may change over time and can vary by location and industry, please consult a lawyer or HR expert for advice specific to your business. You can also contact Payroll Systems to inquire about our HR support services.