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Industry News

COVID-19 Carrier and Industry Resources

This article organizes and summarizes carrier and industry resources and carrier accommodations related to COVID-19. We are constantly updating this article with new information. Please continue to check back.

CARES Act: Paycheck Protection Program

On Mar 27, the US enacted The Coronavirus Aid, Relief and Economic Security Act (CARES Act), which included a Paycheck Protection Program (PPP) for small businesses. All businesses impacted COVID-19 that are considering layoffs or furloughs—and those that have already begun reducing their workforce or hours—should strongly consider this program.

The PPP is a forgivable loan program funded with $670B—initially with $349B and replenished with an additional $321B—intended to help businesses with less than 500 employees keep their employees employed and paid from Feb 15 through June 30, 2020. The program provides up to 2.5x the average monthly payroll expenses (up to $10M/business), which is intended to cover 8 weeks of payroll costs, continuation of group health premiums, mortgage interest, rent payments, utilities, and other debt interest. Payroll costs do not include compensation to any employee in excess of $100k (as prorated over the 8 week period) and payments for qualified sick leave already credited by the Families First Coronavirus Response Act (FFCRA).

The loan obligation can be forgiven in full as long as employers do not reduce their workforce or reduce any employee’s compensation by more than 25%. The loan forgiveness will be reduced by the extent to which the workforce and/or compensation was reduced. Reductions in employment or wages that occur from Feb 15 through Apr 26 will not reduce the amount of loan forgiveness if the employer eliminates the reduction by June 30, 2020. Forgiven amounts will be considered cancelled indebtedness and will be excluded from gross income. Repayment of any amounts not forgiven will be deferred for at least six months, subject to a 1% interest rate, and mature in two years.

The loans are available through any SBA lender, however employers should start with their business banker because banks will prioritize their own clients. Or, employers can use this search tool to find a local SBA approved bank.

Review these resources for more complete information about the program.

Separate from the Paycheck Protection Program, the CARES Act also included an Economic Injury Disaster Loan (EIDL) program available through the SBA directly. EIDL loans are traditional in nature and included to provide a lifeline for expenses beyond payroll. Interested businesses can apply here.

Upcoming Webinars

We strongly encourage you to attend important upcoming webinars. We will post links to past webinar recordings here and remove past listings that are not recorded. UHC will conduct separate weekly briefings, but will not record them. The briefings are very informative.

WhenHostDescription 
Fri, Mar 20 at 12pm
(1 hour)
Mintz Law FirmCOVID-19 and the Workplace. Mintz attorneys provide guidance on employment and benefits issues.Replay
Wed, Mar 25 at 12pm
(1 hour)
CignaCOVID-19 Update from national executive leadership. Provides clinical insights.Replay
Wed, Mar 25 at 2pm
(1 hour)
Sun LifeEmployment Law Compliance Issues. Senior counsel discuss employment law and compliance requirements including discrimination, absence management, and the FFCRA law.Replay
Fri, Mar 27 at 12pmNAHUCOVID-19 and Employee Benefits. Benefits attorney discusses all matters related to benefit plans. (Restricted to NAHU members only.)Replay
Mon, Mar 30 at 2pm
(1.25 hours)
BDOCARES Act: What it Means for You & Tax Strategies to Increase Cash Flow. BDO is a global tax advisory firm.Replay
Wed, Apr 1 at 12pm
(1 hour)
NAHUFFCRA Compliance & Employer Actions. Will examine the FFCRA from an HR perspective and what to consider. (Restricted to NAHU members only.)Replay
Wed, Apr 1 at 1pm
(1 hour)
BDOPaycheck Protection Program: What Restaurants Need to Know. BDO is a global tax advisory firm.Replay
Tue, Apr 7 at 1pm
(1 hour)
Sun LifeCOVID-19 Economic and Employment Legislation Including the CARES Act. Sun Life also posted this recorded webcast to discuss the Paycheck Protection Program.Replay
Tue, Apr 7 at 1pm
(1 hour)
CignaCOVID-19 Federal Relief Package Business Loans and Resources. Speakers include the US Chamber of Commerce and a Congressional member. Discuss programs and how to apply.Replay
Wed, Apr 8 at 12pm
(1 hour)
BDOCOVID-19: Preparing for the Economic Impacts of a Pandemic. Improving performance, applying for relief under the CARES Act, and tax implications.Replay
Thu, Apr 9 at 2pm
(45 minutes)
HumanaNavigating COVID-19 with Small Businesses. Intended for broker audience.Replay
Fri, Apr 10 at 2pm
(1 hour)
NAHUPaycheck Protection Program Explained. Speakers include the CEO of MZQ Consulting and American Bankers Association VP of Congressional relations. (Restricted to NAHU members only.)Replay
Mon, Apr 13 at 11am
(1 hour)
Kilpatrick CompaniesCOVID-19 Carrier and Broker Resources presented by Scott Kilpatrick. View slides.Replay
Thu, Apr 16 at 10am
(1 hour)
ThinkHRCOVID-19: HR Guidance and Best Practices.Replay
Thu, Apr 16 at 12pm
(1 hour)
NAHUUpdate on New Agency Guidance on the FFCRA and CARES Act. Attorney will discuss all guidance from DOL, HHS, and CMS to implement the CARES Act and the FFCRA. (Restricted to NAHU members only.)Replay
Thu, Apr 23 at 12:30pm
(1 hour)
PrimePayCOVID-19 Update: Avoid These Common COBRA Compliance MistakesReplay
Thu, Apr 23 at 1pm
(1 hour)
Sun LifeHow the CARES Act can protect businesses, employees, and benefits. Presented by James Slotnick, Health of Government Relations.Replay
Mon, Apr 27 at 2pm
(45 minutes)
HumanaNavigating the Physical and Mental Impacts of COVID-19 presented by Humana's Chief Medical Officer, Dr. William ShrankReplay
Tue, Apr 28 at 11am
(1 hour)
AetnaHealth Care Strategies and Support for Navigating a PandemicReplay
Wed, Apr 29 at 1pm
(30 minutes)
EaseEase and Kilpatrick Companies will discuss the Ease platform for virtual open enrollments, benefits administration, and a special promotion.Register
Thu, Apr 30 at 12pm
(1 hour)
NAHUCOVID-19 FAQs with the Compliance
Corner Committee. (Restricted to NAHU members only.)
Replay
Thu, Apr 30 at 1pm
(1 hour)
Sun LifeEmployment Compliance Considerations for Re-opening the WorkplaceAttend
Thu, Apr 30 at 2pm
(1 hour)
TDITDI Deputy Commissioner, Chris Herrick, to discuss agent licensure updates and important TDI initiatives.Attend
Thu, May 7 at 12pm
(1 hour)
NAHUExperiences from a COVID-19 Hot Zone & Impact on Our Industry. (Restricted to NAHU members only.)Replay
Thu, May 7 at 2pm
(1 hour)
HumanaHelping Employers Develop Safe COVID-19 Return to Work Plans. Presented by Tim State, SVP of Associate Health & Well-being.Register
Tue, May 12 at 2pm
(1 hour)
UHCLearn how UnitedHealth Group is helping those impacted by COVID-19 and how it will benefit UHC customers.Attend
Wed, May 13 at 1pm
(1 hour)
Sun LifeSun Life answers questions for their clients about benefits and administrative accommodations.Attend
Fri, May 15 at 12pm
(1 hour)
NAHULayoffs, Furloughs, Recalls & Other COVID-19 Employer Issues presented by ThinkHR. (Restricted to NAHU members and their clients.)Register
Wed, May 20 at 1pm
(1 hour)
AetnaWorkforce Management in the time of COVID-19Replay
Thu, May 21 at 2pm
(1 hour)
BDOCARES Act: How to Implement Its Provisions to Assist in RecoveryRegister
Tue, May 26 at 1pm
(1 hour)
CignaState of Loneliness in AmericaRegister
Wed, May 27 at 12pm
(1 hour)
NAHUPaycheck Protection Program Loan Forgiveness. (Restricted to NAHU members only.)Register
Thu, May 28 at 1pm
(1 hour)
Sun Life2020 High-cost claim conditions analysis: Top conditions and COVID-19 updateAttend
Thu, May 28 at 2pm
(1 hour)
HumanaCOVID-19 Worksite Testing: Understanding the BasicsReplay
Tue, Jun 9 at 2pm
(1 hour)
UHCCOVID-19 BriefingRegister

Plan Coverage Expansions for COVID-19 Testing

On Mar 11, the IRS announced HDHPs can cover COVID-19 testing as preventive care without a deductible.

On Mar 17, the TDI issued an emergency rule requiring fully insured health plans, which are regulated by the state, to cover telehealth services using any platform permitted by the state and pay in-network health professionals at least the same rate for telehealth services as for in-person services. The rule was effective immediately, remains in effect for up to 120 days, and can be extended for an additional 60 days if needed. The rule does not apply to self-funded or level funded plans.

On Mar 18, the US enacted The Families First Coronavirus Response Act (FFCRA). FFCRA mandates that all individual and group fully insured and self-funded health plans cover all costs related to COVID-19 testing at no cost sharing. This includes items and services to test or evaluate the necessity of testing rendered in variety of settings including urgent care visits, in-person or telehealth visits, and emergency room visits that result in an order for in vitro diagnostic products.

On Mar 27, the US enacted The Coronavirus Aid, Relief and Economic Security Act (CARES Act). The bill provides $2T in emergency economic stimulus including the initial $349B funded for the Paycheck Protection Program (PPP) and $10B for an Economic Injury Disaster Loan (EIDL) grant program. By Apr 17, both the PPP and the EIDL exhausted their initial appropriations. The CARES Act also expanded accessibility to telehealth and set parameters for insurers to use when paying for COVID-19 testing. If the provider is not in-network, the insurer must pay the provider’s cash price, which must be posted online (subject to a $300/day penalty for noncompliance). Read this article from our attorneys at Chamberlain Hrdlicka for a summary of the SBA loan provisions in the Act. Read this article from the Mintz Law Firm for a comprehensive summary of the bill.

On Apr 24, the US enacted the Paycheck Protection Program and Health Care Enhancement Act. The act replenished the Paycheck Protection Program with more than $321B in additional funding—with $60B of the funding earmarked for smaller lenders—and increased the authorization for Economic Injury Disaster Loans by $10B. The act provides $75B in reimbursements to health care providers for expenses or lost revenues attributable to COVID-19 and $25B to expand COVID-19 testing.

Carrier Actions and Accommodations

Carriers are developing plans to provide accommodations to employers. We will publish information we gather it here.

BCBS.

  • BCBS will allow employers to offer a special enrollment opportunity for employees and dependents who previously waived coverage to enroll. The special enrollment period will run from Mar 30 to Apr 30. All changes must be received by May 1. Coverage will be effective Apr 1 for most groups. This is not an open enrollment period. Currently enrolled employees cannot change plan elections under this accommodation. Associated election changes should be entered in the Blue Access for Employers portal. View official announcement (Apr 1).
  • On a case-by-case special exception basis, BCBS may allow an employer to offer a special enrollment period allowing currently covered employees to select a new plan option among the plans currently offered by the employer. Exception requests require management approval. Any associated plan election changes must be emailed to BCBS in a census spreadsheet; they cannot be processed online.
  • BCBS will waive their ‘actively at work’ requirements. As long as premiums are paid, employers can continue to cover employees who were enrolled in coverage as of Mar 20 and no longer meet eligibility definitions through Apr 30, 2020. Coverage availability must be offered on a uniform, non-discriminatory basis. This flexibility does not apply to employees who newly enroll during the special enrollment period described above.
  • BCBS committed to not adjust rates or premiums during the plan year if a group’s enrollment decreases by more than 10% due to COVID-19 factors. Rates will adjust at renewal.
  • BCBS allows employers with member-rated billing to make midyear plan changes within six months of the start of the plan year without requiring the plan year to restart. A midyear plan change under these conditions does not trigger an open enrollment opportunity. It only impacts covered employees. A BPA for Amendment must be submitted at least 30 days prior to the change effective date.
  • As a standard practice, BCBS allows groups that do not meet the midyear change conditions to renew early in order to make plan changes. Groups must submit a BPA for Amendment at least 30 days prior to the effective date. The anniversary date will reset to a new 12 month plan year, and the event triggers a true open enrollment opportunity for all employees.
  • BCBS will consider employer requests to extend premium grace periods for groups on a case-by-case basis. Employers need to provide the reason for request and extension date requested.
  • BCBS will not enforce their renewal paperwork submission deadline (30 days prior to renewal date) for the time being.
  • From Apr 1 to June 30, 2020, BCBS will waive all cost-sharing for inpatient hospital admissions and out-of-network emergencies related to COVID-19 treatment. Applies to fully insured plans. Self-funded plans may ‘opt-in.’

Cigna.

  • On a case-by-case basis at an underwriter’s discretion, Cigna will allow certain employers to offer a special enrollment opportunity for employees who previously waived coverage to enroll. The underwriting team will manage the event and duration. Cigna will not adjust rates as a result of associated membership changes through May 31, 2020. This is not an open enrollment period. Currently enrolled employees cannot change plan elections.
  • Cigna will relax their ‘actively at work’ requirements for employers with medical coverage regardless of funding type. At the request of the employer, Cigna will agree to cover furloughed employees who were enrolled as of Mar 1 through May 31, 2020 as long as premiums are paid. Coverage availability must be offered on a uniform, non-discriminatory basis. See announcement.
  • From Mar 30 through May 31, 2020, Cigna will waive all member cost sharing for all COVID-19 treatment. The waiver will apply to all fully insured, Level Funding, and self-funded plans, although Level Funding and self-funded plans will have an opportunity to ‘opt out’ of the waiver.

Humana. Read their announcement (Mar 23) and their small business resource guide (Apr 10) for more information.

  • Humana will relax their ‘actively at work’ requirements for fully insured and level funded (LFP) coverage through July 31, 2020. As long as one person remains actively employed and enrolled in coverage, employers may continue covering furloughed employees as long as premiums are paid. Coverage availability must be offered on a uniform, non-discriminatory basis.
  • Humana will provide employers with an option to waive the standard waiting period for rehired employees who were laid off due to COVID-19 factors. True new hires will be subject to the standard waiting period.
  • Humana committed to not adjust rates or premiums during the plan year if a group’s enrollment decreases by more than 10% due to COVID-19 factors. Rates will adjust at renewal.
  • Humana allows a standard 30-day grace period for premium payments. They will consider payment extension requests and custom payment plans. Contact 1-800-592-3005 to discuss.
  • Humana will allow midyear plan changes to buy down to a lower cost plan through June 1.
  • Humana will continue to allow employers a 30 day grace period to complete/process open enrollment changes after their effective or anniversary date.
  • Starting Feb 4, Humana will waive all member cost sharing for COVID-19 treatment. The cost sharing waiver applies to all plans—fully insured, Level Funded Premium (LFP), and ASO. Employers with ASO and LFP plans have the option to ‘opt out’ of the waiver.
  • Humana will allow employers with less 100 enrolled employees to pay their premiums on a credit card—Visa, MasterCard, or Discover. The option is temporary and available through the Employer Portal. Humana is absorbing the merchant fee. Note, any cashback or incentive features associated with the credit card may have ERISA compliance implications requiring the money to be treated as plan assets.

Memorial Hermann. Read their broker FAQs (Apr 3).

  • Memorial Hermann will allow employers to offer a special enrollment opportunity to allow 1) employees who previously waived coverage to enroll in a plan, 2) currently enrolled employees to change their plan election among the plans (if more than one) already offered by the employer, 3) and/or employees to change coverage tier elections to add or drop spouses and/or children to or from their existing coverage. The special enrollment period will run from Apr 1 to Apr 15. All updates must be submitted by Apr 15.  Coverage changes will be effective Apr 1. Official communication.
  • As a standard practice, Memorial Hermann waives standard waiting periods for previously terminated employees who are rehired within 6 months of termination
  • Memorial Hermann will relax their new business submission deadlines for Apr-Jun effective date groups to the 10th of the effective month (e.g.: for an Apr 1 effective date, paperwork is due by Apr 10). Their standard deadline for new case submissions has been 5 days prior to the effective date.
  • Memorial Hermann will allow Apr 1 renewal groups whose renewals were not finalized prior to Apr 1 to extend their current plan year by an additional month and renew on May 1. They will honor the rates offered in the Apr 1 renewal offer. Groups taking advantage of this option must submit any plan change paperwork by Apr 30. These groups will have the option of renewing again on Apr 1 (by request) or May 1, 2021 (default).
  • Memorial Hermann will allow employers to renew early to make plan changes. Interested employers must contact their broker for an early renewal offer. They will consider midyear plan buy downs on a special exception request.
  • Memorial Hermann committed to not adjust rates or premiums during the plan year if a group’s enrollment decreases by more than 10% due to COVID-19 factors. Rates will adjust at renewal.
  • Memorial Hermann will offer a Deferred Premium and Payment Contract (see sample) to employers who are unable to pay their Mar-May 2020 premiums in full within Memorial Hermann’s standard 30-day grace period. The contract schedules premium payments on an installment basis during the three month deferment period.

National General. Read this FAQ for details.

  • National General will relax their ‘actively at work’ requirements through May 31, 2020. Employers may continue covering furloughed employees as long as premiums are paid. Coverage availability must be offered on a uniform, non-discriminatory basis.
  • National General will provide employers an option to waive the standard waiting period for employees who were laid off and return to work within 90 days of termination. The waiver must be applied uniformly to all previously covered employees who are rehired within 90 days.
  • National General will continue to offer a 30-day grace period for premium payments. They will consider payment plans on a case-by-case basis.
  • National General may consider midyear plan design changes to buy-down the monthly cost.
  • National General will consider extending the open enrollment period for renewing employers on a case-by-case basis.

Scott & White – Fully Insured Clients. Review their FAQ for more details.

  • SWHP will allow employers to offer a special enrollment opportunity to allow employees who previously waived coverage to enroll in a plan and for active employees who are enrolled in self-only (EO) coverage to add a spouse or children to their existing coverage. The special enrollment period will run from Mar 28 to Apr 20. Coverage will be effective Apr 1. Employees cannot switch plans or drop coverage. Read their official notice here. Employers and/or brokers can submit the associated changes via the Employer Portal online.
  • SWHP will relax their ‘actively at work’ requirements through May 31, 2020. Employers may continue covering furloughed employees who are not officially terminated and as long as premiums are paid. Coverage availability must be offered on a uniform, non-discriminatory basis.
  • SWHP will provide employers with an option to waive the standard waiting period for rehired employees who were laid off due to COVID-19 factors. True new hires will be subject to the standard waiting period.
  • SWHP will consider employer requests—on a case-by-case basis—to extend premium grace periods for the months of Apr and May and will determine a proper payment plan for each. They intend to end the extended grace periods on May 31, subject to regulatory requirements.
  • Starting Mar 6, SWHP will waive all member cost sharing for COVID-19 treatment on all fully insured health plans. There is no expiration date yet for the waiver. See notice here.

UHC – Fully Insured Clients. Read the materials available in their broker FAQ page here.

  • UHC will allow employers to offer a special enrollment opportunity for employees and dependents who previously waived coverage to enroll. The special enrollment period will run from Mar 23 to Apr 13 (extended from Apr 6). Coverage will be effective Apr 1.
  • From Mar 23 through May 31, UHC will allow employers to add a new lean medical plan design and allow employers who offer a single option to move to a lean plan design off-cycle without modifying the anniversary date. Members with existing coverage will be allowed to move to the new lean option or keep their existing plan, but will not be allowed to drop coverage or switch to any other plan already offered. Employers who add or move to a new lean plan design, may also offer the special enrollment opportunity for previously waived members to enroll until Apr 13. The effective date of the new lean plan will depend on the timing of the plan change request and member election submissions. 4/1 effective due by 4/13. 5/1 effective due by 5/14. 6/1 effective due by 6/8.
  • UHC will relax their ‘actively at work’ requirements for employers with medical coverage. Employers can continue to cover employees furloughed due to COVID-19 through May 31, 2020 as long as premiums are paid. Coverage availability must be offered on a uniform, non-discriminatory basis. UHC will allow coverage to remain in force for no longer than 13 consecutive weeks for non-medical leave and no longer than 26 consecutive weeks for medical leave.
  • UHC will provide employers with an option to waive the standard waiting period for rehired employees who were laid off due to COVID-19 factors. True new hires will be subject to the standard waiting period.
  • UHC committed to not adjust rates or premiums during the plan year if a group’s enrollment decreases by more than 10% due to COVID-19 factors. Rates will adjust at renewal.
  • UHC provides employers with a 30 day grace period for premium payments. They will consider requests for payment extensions on a case-by-case basis. The group must submit the request directly to UHC. They will not accept requests from the broker or GA. Ask our office for the proper contact to provide to your clients.
  • Starting Mar 31 through May 31, UHC will waive all member cost sharing for COVID-19 treatment.

UHC – All Savers Clients. Read the All Savers FAQ on the UHC broker FAQ page here.

  • All Savers will allow employers to offer a special enrollment opportunity for employees and dependents who previously waived coverage to enroll. The special enrollment period will run from Mar 23 to Apr 13 (extended from Apr 6). Coverage will be effective Apr 1. This is not an open enrollment period. Currently enrolled employees cannot change plan elections.
  • All Savers will relax their ‘actively at work’ requirements for employers with medical coverage. Employers can continue to cover employees furloughed due to COVID-19 through June 30, 2020 as long as premiums are paid. Coverage availability must be offered on a uniform, non-discriminatory basis. All Savers will allow coverage to remain in force for no longer than 13 consecutive weeks for non-medical leave and no longer than 26 consecutive weeks for medical leave.
  • All Savers will provide employers with an option to waive the standard waiting period for rehired employees who were laid off due to COVID-19 factors. True new hires will be subject to the standard waiting period.
  • All Savers provides employers with a 30 day grace period for premium payments. They will consider requests for payment extensions on a case-by-case basis. The group must submit the request directly to uhoadminallsavers@uhc.com. They will not accept requests from the broker or GA.
  • Starting Mar 31 through May 31, All Savers will waive all member cost sharing for COVID-19 treatment. See the FAQs linked under ‘Testing and coverage’ and ‘Treatment and coverage’ on the broker FAQ page.

Aetna – 2-100 Segment Fully Insured and AFA Clients. Read their FAQs here.

  • Aetna will allow employers to offer a special enrollment opportunity for employees and dependents who previously waived coverage to enroll. The special enrollment period will run from Apr 6 to Apr 17. Coverage will be effective on Apr 1 or May 1, at the employer’s discretion. This is not an open enrollment period. Currently enrolled employees cannot change plan elections.
  • Aetna will relax their ‘actively at work’ requirements for employers with AFA coverage. Employers can continue to cover employees furloughed due to COVID-19 through July 31, 2020 as long as premiums are paid. Coverage availability must be offered on a uniform, non-discriminatory basis.
  • Aetna will provide employers with an option to waive the standard waiting period for rehired employees who were laid off due to COVID-19 factors. True new hires will be subject to the standard waiting period.
  • Aetna will extend payment grace periods and offer payment plans on a case-by-case basis through May 31, 2020.
  • Aetna will allow midyear plan changes through July 31, 2020 to buy down coverage as long as the renewal date is maintained.
  • Aetna committed to not adjust rates during the plan year if a group’s enrollment decreases by more than 10% due to COVID-19 factors. Rates will adjust at renewal.

Aetna – 100+ Segment Clients. Read their FAQs here.

  • Aetna will allow employers to offer a special enrollment opportunity for employees and dependents who previously waived coverage to enroll. The special enrollment period will run from Apr 6 to Apr 17. Coverage will be effective on Apr 1 or May 1, at the employer’s discretion. This is not an open enrollment period. Currently enrolled employees cannot change plan elections.
  • Aetna will relax their ‘actively at work’ requirements for employers with fully insured coverage in the 100+ market segment. Employers can continue to cover employees furloughed due to COVID-19 through July 31, 2020 as long as premiums are paid. Coverage availability must be offered on a uniform, non-discriminatory basis.
  • Through July 31, 2020, Aetna will provide employers with an option to waive the standard waiting period for rehired employees who were laid off due to COVID-19 factors.
  • Aetna will allow midyear plan changes through July 31, 2020 to buy down coverage as long as the renewal date is maintained.
  • Aetna committed to not adjust rates during the plan year if a group’s enrollment decreases by more than 10% due to COVID-19 factors. Rates will adjust at renewal.
  • From Mar 25 through June 1, 2020, Aetna will waive cost-sharing and copays for inpatient hospital admissions related to COVID-19.

Ancillary Carriers

Most ancillary carriers have announced rate passes for all renewing groups on all lines of coverage over the next few months. Contact your service team or rep for accommodations available for a specific carrier.

Economic Hardship and Workforce Reductions

Many businesses will experience extreme economic hardship and are considering a variety of options to weather the storm. Read this US Chamber of Commerce & MetLife report (that studied the impact of COVID-19 on small businesses.

The FFCRA and the CARES Act are intended to support affected businesses by paying employers to keep employees on payroll (CARES Act) and to require paid family and sick leave (FFCRA) funded by a refundable tax credit. For employers who choose to reduce their workforce in lieu of the CARES Act Paycheck Protection Program, there are a few options and considerations for each:

  • Furloughs – Employees are required to take unpaid time off but are not terminated from employment. A reduction in hours below 30 hours per week typically causes an employee to lose eligibility as a full time employee. Employees can continue coverage on COBRA or state continuation, depending on employer size. With the exception for variable hour employees in a stability period, employers cannot continue active coverage for a furloughed employee working less than 30 hours a week without amending their health plan (if self-funded) or approval from their insurer (if fully insured or from a stop loss insurer).
  • Layoffs – A termination of employment; separation from payroll. Layoffs typically occur when there is not enough work for an employee to perform and may intend to recall the person when the work again becomes available. Where applicable, the employer offers COBRA or state continuation.
  • Reductions in Force – Occurs when a position is eliminated without the intention of replacing it—a permanent cut in headcount.

Read this guidance from Epstein Becker & Green and Ballard Spahr for more information about the issues involving furloughed employees and employee benefits. For employment practices implications, read this memorandum from Chamberlain Hrdlicka.

Emergency Paid Family Leave Provisions

The FFCRA included provisions applicable to employers with less than 500 employees to expand FMLA and to provide paid sick leave via refundable tax credits. The Act is in effect from Apr 1 to Dec 31, 2020. A few of its provisions were amended by the CARES Act and clarified by the DOL in a series of FAQs.

  • Emergency Family and Medical Leave Act Expansion – Applies to employees employed for at least 30 days. Employers must provide up to 12 weeks of job-protected FMLA due to leave associated with school closure, child care limitations, or declared emergency. The first 10 days are unpaid. Time remaining must be paid at two-thirds of an employee’s rate of pay up to $200 per day. Job restoration exceptions may be granted to employers with less than 25 employees.
  • Emergency Paid Sick Leave – Applies to all employees regardless of tenure. The act entitles employees to up to 80 hours of sick leave who are quarantined, caring for someone under quarantine, or caring for a child at home due to school or childcare closure. The pay rate depends on the basis for leave.

Read this article from our attorneys at Chamberlain Hrdlicka for a full synopsis and this article from Ballard Spahr summarizing the CARES Act updates and DOL clarifications.

At Kilpatrick Companies

As of Mar 25, our employees are working from home while local ‘Stay at Home’ orders are in effect. You should experience no operational interruptions. Our internal systems and employee desktops run entirely on our servers. Our phone system operates exactly the same. All employees use Slack to collaborate internally.

We will not accept any walk-ins until all social distancing restrictions are lifted. In the interim, we ask brokers to call and email. If a face-to-face meeting is necessary, it must be scheduled in advance.

Carrier Resources

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