- Exclusion of temps, interns, co-ops, casual employees, and similar groups. The ACA’s employer mandate does not allow categorical exclusions of this sort. The ACA requires that an offer be made to full-time employees, defined as anyone who works more than 30 hours of service per week. All paid hours count as “hours of service”, except for very narrow exceptions (hours of students on work study, non-profit volunteers, and religious who have taken a vow of poverty, as well as hours related to non-US income). In sum: Employers can call an employee a “temp” or “intern”, but if the employee works at least 30 hours per week, he or she is full-time; if an employer doesn’t offer affordable, minimum value medical coverage to that employee, the employer risks ACA penalties.
- Prohibited waiting periods. The ACA’s insurance reforms prohibit waiting periods of more than 90 days before major medical coverage can start. It is important to remember that there must be an opportunity for the employee to begin coverage no later than the end of the 90-day period. We continue to encounter plans that permit employees to start coverage “on the first day of the next month following the 90th” The IRS and DOL have made clear that this interpretation is unacceptable. Similarly, a three-month waiting period does not work, since three months is often more than 90 days.
Benefits Think Why employers should review their employee handbooks with an eye towards ACA compliance
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Patricia A. Moran
Of Counsel
Attorney Patricia A. Moran counsels clients on a variety of employee benefits and compensation matters. She represents clients in a broad variety of health and welfare plan matters, including the … Read full bio
