Health Care Reform

Final Rules on 90-Day Waiting Period Limitation

Group Health Plans Must Comply Beginning in 2014

Final rules address the requirement in the Affordable Care Act that group health plans limit any waiting period to 90 days, effective for plan years beginning on or after January 1, 2014. A waiting period is the period of time that must pass before coverage for an employee or dependent who is otherwise eligible to enroll under the terms of a group health plan can become effective

Key Highlights
The final rules retain many of the provisions outlined in previously issued 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. Specifically, the final rules provide 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 1200 hours;
  • A former employee who is rehired may be treated as newly eligible for coverage upon rehire and, therefore, may be required to meet the plan’s eligibility criteria and satisfy the waiting period anew, if reasonable under the circumstances; and
  • 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 thepreviously proposed regulations or the final rules (effective for plan years beginning on or after January 1, 2015).

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