COVID-19 Implications for Employer-Sponsored STD Plans

Amanda Wilke, CEBSApril 28, 2020April 28, 2020

Canadian employers and employees are both struggling to keep up with all the changes due to the coronavirus pandemic. Theresa Tran, CEBS, a senior benefits consultant at Eckler Ltd., spoke about COVID-19 implications for employer-sponsored group short-term disability (STD) plans during the April 21 International Foundation webcast, COVID-19: Government Response Programs and Implications for Employment Insurance and Disability Plans.

In March, when COVID-19 was declared a pandemic, the Canada Life and Health Insurance Association (CLHIA) met with member organizations to discuss consistency in managing COVID-19 claims. As a result, many insurance carriers adopted a new process in reviewing and managing STD claims. The process became a best practice recommended for all employer-sponsored STD plans, including self-insured plans.

Tran explained the new process for determining eligibility for STD COVID-19 claims:

Claims must be medically supported and must satisfy the disability definition—illness or injury that prevents an individual from doing their job.
Waiting periods are waived.
Simplified medical forms are commonly accepted for the claimant, and flexibility exists with accepting Attending Physician Statements (APS) from other treatment providers (e.g., chiropractors, medical care teams) or substituting clinical notes in place of APS.

Carriers maintain consistency by using CLHIA’s recommended simplified claimant statement form, Plan Member Confirmation of Illness, for absences due to COVID-19 when the plan member has symptoms of COVID-19 or has pending test results.

Two common employer questions related to STD implications are:

How are most plans accommodating situations where the treating physician is too busy to complete medical forms for STD claimants?
Many plans are accepting APS from a broader medical treating team; physician clinical notes are acceptable. Some plans are also reaching out virtually to physicians.
Can employers get the Canada Emergency Wage Subsidy (CEWS) when employees are on STD?
It depends whether the employer continues to pay the employee. If self-insured STD employers continue to pay employees while on sick leave, employers may get the emergency wage subsidy. With any paid leave of absence, as long as the employer continues to pay the employee, employers may include employee wages in the wage subsidy. However, if the employee receives benefits from the STD plan through an insurer, they would be considered without wages from the employer. When no wage is paid by the employer, there is nothing capable of being subsidized, so the employer could not get the wage subsidy.

Learn More

Tune into the webcast COVID-19: Government Response Programs and Implications for Employment Insurance and Disability Plans on-demand to explore even more changes and implications pertaining to the new government response programs—Canadian Emergency Response Benefit (CERB) and Canadian Emergency Wage Subsidy (CEWS). Co-presenter Clio M. Godkewitsch, Partner at Goldblatt Partners LLP, explains eligibility for these programs, requirements, duration of the benefits and other compliance issues.