The Affordable Care Act provided a maximum 90 day waiting period for coverage of employees (California has updated this and made it 60 days, both as of the anniversary date of existing group coverage). What’s in a word, or expression, or name? Some highlights, which are left open to interpretation as to how this should all be instituted (26 CFR Part 54)
- A group health plan or health insurance issuer offering group health insurance coverage shall not apply any waiting period that exceeds 90 (60) days
- Applies to both grandfathered and non grandfathered plans
- Eligibility conditions that are based solely on the lapse of a time period would be permissible for no more than 90 days
- The eligibility condition is not considered to be designed to avoid compliance with the 90 day waiting period limitation if the cumulative hours of service requirement does not exceed 1,200 hours
- Waiting period still defined as that which must pass before coverage for an individual who is otherwise eligible to enroll under the terms of a group health plan can become effective
- Waiting period limitation generally doesn’t require the plan sponsor to offer coverage to any particular individual or class of individuals. Instead the final regulations prohibit requiring otherwise eligible individuals to wait more than 90 days before coverage becomes effective
- Other conditions are generally permissible under these regulations unless the condition is designed to avoid compliance with the 90 day waiting period limitation