Capitol benefits Group Celebrates One Year
Woo hoo!! This month Capitol Benefits Group (CBG) reached its one-year anniversary. We would like to thank YOU, our valued client, who we are proud to represent and serve. You made this milestone our reality by placing your trust in our team.
Thank you also once again to the group clients who were able to participate in the CBG Client Portal training event that we held last month! We were pleased to provide the training and appreciated your engagement and excellent questions.
In a follow-up, we are passing along this CBG HR Contacts & Resources Reference Guide to ensure that you have the URL links to your valuable online HR resources and tools. With any login issues, please feel free to reach out to our team and we can always help troubleshoot your issue. Additionally, and especially if you missed our event, please refer to the instructional video to acquaint yourself with the features and options included in the CBG Client Portal offering.
Important Information
The General COBRA Notice and COBRA Election Notice Models Have Been Updated
On May 1, 2020, the U.S. Department of Labor issued a new model notices that group health plans may use to use to comply with COBRA notification requirements. The use of the models is not mandatory but considered to be good-faith compliance with COBRA’s content requirements. As explained in a set of answers to frequently asked questions (FAQs) the DOL also issued on May 1, 2020, the updated model notices aim to help qualified beneficiaries better understand the interactions between Medicare and COBRA.
DOL Now Fully Enforcing FFCRA Paid Leave Rules for Coronavirus
After observing a 30-day non-enforcement period to help employers come into compliance with new paid leave rules, the U.S. Department of Labor (DOL) has announced that it is fully enforcing all provisions of the Families First Coronavirus Response Act (FFCRA).
The FFCRA requires private employers with fewer than 500 employees and certain government employers to provide paid leave for their employees, either for the employees’ own health needs or to care for others, for reasons related to the coronavirus (COVID-19) pandemic. These requirements apply for employee leave taken between April 1 and Dec. 31, 2020.
Now that the temporary policy has expired, the DOL is fully enforcing the FFCRA. Employers may still face retroactive penalties for violations committed during the non-enforcement period under certain circumstances. According to the DOL’s frequently asked questions (FAQs) about the FFCRA, the agency will retroactively enforce violations back to the effective date of April 1, 2020, if employers have not remedied the violations. Penalties for FFCRA violations include civil lawsuits and criminal charges punishable by imprisonment and fines of up to $10,000.
The laws take effect within 15 days of passage; the leave benefits will expire on Dec. 31, 2020.
New Electronic Distribution Options for Retirement Plans
On May 21, 2020, the U.S. Department of Labor (DOL) published a final rule that will allow plan administrators to post-retirement plan disclosures online or deliver them to employees by e-mail, as a default, to comply with their statutory duty to furnish documents under ERISA.
This new safe harbor permits the following two optional methods for electronic delivery:
Website posting—Plan administrators may post covered documents on a website if appropriate notification of internet availability is furnished to the electronic addresses of covered individuals.
E-mail delivery—Alternatively, plan administrators may send covered documents directly to the electronic addresses of covered individuals, with the documents either in the body of the e-mail or as an attachment.
The final rule is limited to retirement plan disclosures, such as summary annual reports or pension benefit statements, but does not include documents that must be furnished only upon request. The final rule does not apply to employee welfare benefit plans, such as group health plans.
If using the new safe harbor, plan administrators should ensure compliance with the various protections for plan participants included in the final rule, such as initial paper notification and website retention requirements. More information about these requirements can be found in the DOL’s Fact Sheet.
Guidance Applies to Employer-Sponsored Health Coverage, Health FSAs, and DCAPs
On May 12, 2020, the IRS released Notice 2020-29, which provides temporary flexibility for mid-year election changes under a Section 125 cafeteria plan during the calendar year 2020. The changes are designed to allow employers to respond to changes in employee needs as a result of the COVID-19 pandemic.
A plan may permit any of the election changes described in the notice, regardless of whether they satisfy existing mid-year election change rules. For employer-sponsored health coverage, a Section 125 cafeteria plan may permit an employee to prospectively:
Make a new election if the employee previously declined coverage;
Revoke an existing election and enroll in different health coverage sponsored by the employer; or
Revoke an existing election, if the employee is or will be enrolled in other health coverage.
Employees may also prospectively revoke an election, make a new election or decrease or increase an existing election for a health flexible spending account (health FSA) or dependent care assistance program (DCAP).
An employer using this relief may determine the extent to which such changes are permitted and applied. If these changes are permitted, the employer must adopt a plan amendment by Dec. 31, 2021, and inform employees of the change. The amendment may be retroactive to Jan. 1, 2020.
Options Include an Extended Period for Incurring Expenses and Increased Health FSA Carryover Limit
On May 12, 2020, the IRS announced more options with respect to unused amounts in health flexible spending accounts (FSAs) and dependent care assistance programs (DCAPs). These options allow employers to permit:
An extended period for incurring health FSA or DCAP expenses; and
Health FSA carryovers of up to $550.
Due to the COVID-19 outbreak, employees may be more likely to have unused amounts in their health FSAs or DCAPs. IRS Notice 2020-29 allows employers to permit employees to apply unused amounts remaining in a health FSA or a DCAP at the end of a plan year ending in 2020 (or a grace period ending in 2020) to pay or reimburse expenses incurred through Dec. 31, 2020.
IRS Notice 2020-33 increases the health FSA carryover limit for unused funds remaining at the end of a plan year from $500 to $550 to reflect indexing for inflation. This change is effective for plan years beginning in 2020 (and reflects the maximum amount that may be carried over to the immediately following plan year beginning in 2021).
Inflation-Adjusted HSA Contribution Limits and HDHP Amounts for 2021 Announced
The IRS has announced the 2021 inflation-adjusted amounts for Health Savings Accounts (HSAs) as determined under the Internal Revenue Code.
Annual Contribution Limits
For the calendar year 2021, the annual limit on HSA contributions for an individual with self-only coverage under a high deductible health plan (HDHP) is $3,600 (up from $3,550 for 2020). The annual limit on HSA contributions for an individual with family coverage under an HDHP is $7,200 (up from $7,100 for 2020).
HDHP Amounts
For plan years beginning in 2021, an HDHP is defined as a health plan with an annual deductible that is not less than $1,400 for self-only coverage or $2,800 for family coverage, and annual out-of-pocket expenses (deductibles, co-payments, and other amounts, but not premiums) that do not exceed $7,000 for self-only coverage or $14,000 for family coverage.
Click here to read the IRS announcement.
EEOC Updates Employer Guidance on Coronavirus and the ADA
On April 23, 2020, the Equal Employment Opportunity Commission (EEOC) issued additional answers to FAQs about how employers should comply with the Americans with Disabilities Act (ADA) while also observing all applicable emergency workplace safety guidelines during the coronavirus pandemic. The new FAQs were added to guidance that the EEOC previously issued on March 18, April 9, and April 17, 2020.
The FAQs draw from the EEOC’s existing pandemic publication, Pandemic Preparedness in the Workplace and the ADA, to help employers navigate workplace issues related to COVID-19. In particular, the EEOC’s FAQs include information from a section of the publication that answers employer questions about what to do after a pandemic has been declared.
Employers are subject to the ADA if they have 15 or more employees. Smaller employers may be subject to similar rules under applicable state or local laws. All employers should follow the most current guidelines and suggestions for maintaining workplace safety, as issued by the CDC and any applicable state or local health agencies. Employers with 15 or more employees should also become familiar with and follow the guidance provided in the EEOC’s FAQs about ADA compliance. These and all smaller employers should ensure that they comply with state and local anti-discrimination laws as well.
Determining When to Reopen After the Coronavirus Shutdown
While many essential businesses (e.g., hospitals, pharmacies, grocery stores and gas stations) have remained open during the COVID-19 pandemic, other operations deemed nonessential have shut down temporarily or changed the nature of their operations.
However, we may be nearing a time when stay-at-home regulations are scaled back and all businesses are allowed to resume as normal. The question then is: How will business owners know it is acceptable to reopen? The following are some best practices to keep in mind:
Review guidance from state and local governments—The COVID-19 pandemic impacts states and regions in different ways. Just because a business is allowed to reopen in one region of the country doesn’t automatically mean your operations will be allowed to resume as well. As such, it’s critical to understand and review all relevant state and local orders to determine if and when your business is allowed to reopen.
Understand the risks—If and when the government allows all businesses to reopen, that doesn’t necessarily mean COVID-19 is no longer a threat to your operations. What’s more, some businesses may have greater COVID-19 exposures than others, underscoring the importance of performing a thorough risk assessment before reopening. Prior to conducting a risk assessment, it’s important to review guidance from the Occupational Safety and Health Administration (OSHA), state and local agencies, industry associations as well as your local health department. More information on conducting a risk assessment can be found below.
Again, before reopening, it’s critical to seek the expertise of legal, insurance, and other professionals.
Sick Workers Should Stay Home
When sick employees come to work, they can potentially spread their illnesses throughout the office. Learn why sick workers should stay home, especially during the COVID-19 pandemic, by watching this VIDEO