On February 20, 2014, federal agencies released the final rule on the 90 day waiting period provision of the Affordable Care Act. The 90 day waiting period provision mandates that coverage under a group health plan be made available to “otherwise eligible” employees and their dependents no later than 90 calendar days from an employee’s eligibility date.
The 90-day waiting period provision applies to employers of all sizes and all plan types, including grandfathered plans and self-insured plans. The provision takes effect on the first day of the new plan year in 2014.
The federal agencies also released a separate proposed rule on what constitutes a "reasonable and bona fide employment-based orientation period” related to meeting a plan’s eligibility conditions for the 90-day waiting period.
Final Rule on the 90 Day Waiting Period Provision - Key Highlights
The final rule retains many of the provisions outlined in the proposed regulations, such as the approach for applying waiting periods to variable-hour employees in cases in which a specified number of hours of service per period is a plan eligibility condition.
The final rule specifies that:
All calendar days are counted for purposes of the 90-day limit, including weekends and holidays, beginning on the individual's enrollment date.
Coverage is not required to be offered to any particular individual or class of individuals.
The requirement that employees complete a certain number of hours before becoming eligible for coverage is generally allowed as long as the requirement is capped at 1,200 hours.
A former employee who is rehired may be treated as newly eligible for coverage upon rehire and as such, may be required to meet the plan's eligibility criteria and satisfy the waiting period, if reasonable under the circumstances.
A requirement to successfully complete a reasonable and bona fide employment-based orientation period may be imposed as a condition for eligibility for coverage under a plan (a companion proposed rule would limit the maximum duration of an otherwise permissible orientation period to one month).
For plan years beginning in 2014, plans may comply with either the proposed regulations or the final rule. The final rules are effective for all plan years beginning on or after January 1, 2015.
Click here to read the official Department of Labor (DOL) news release.
See related articles:
- The 90 Day Waiting Period and Section 105 Healthcare Reimbursement Plans
- 90 Day Limitation on Waiting Periods for Group Health Plans