The Department of the Treasury released final regulations on the Affordable Care Act's 90-day waiting period limitations. The final rule clarifies how the 90-day waiting period works with an employee orientation period.
How the 90-Day Waiting Period and Employee Orientation Periods Work Together
The most recent final rule builds upon the 90-day waiting period regulations released in February 2014. The final regulations go into effect on August 15, 2014 and impact group health plans, including self-funded plans, with plan years beginning on or after January 1, 2015.
Here are the key points:
The “waiting period” is further defined as the amount of time that must pass before coverage for an otherwise eligible employee or dependent becomes effective.
Being otherwise eligible to enroll in a plan means having met the plan’s substantive eligibility conditions.
The plan may still impose substantive eligibility criteria, but it may not impose conditions for the sake of passing time. For example, it may include being in an eligible job classification, achieving job-related licensure requirements specified in the plan’s terms, or satisfying a reasonable and bona fide employment-based orientation period.
The maximum allowed length of any reasonable and bona-fide employment-based orientation period is defined as one (1) month.
After an individual is determined to be otherwise eligible for coverage under the terms of the plan, any waiting period may not extend beyond 90 days. All calendar days are counted starting from the enrollment date, including weekends and holidays.
Compliance with the waiting period and orientation periods is not determinative of compliance with the "employer mandate," in which an applicable large employer may be subject to fees if it fails to offer affordable minimum value coverage to certain newly-hired full-time employees by the first day of the fourth full calendar month of employment.
What questions do you have about the Affordable Care Act's 90-day waiting period and employee orientation periods?