The Internal Revenue Service, the Employee Benefits Security Administration and the U.S. Department of Health and Human Services published regulations today that include a one-month employment-based orientation period, reports LifeHealthPro.
The final regulations also address the relationship between a plan's eligibility criteria and the 90-day waiting period limitation. After an individual is deemed eligible for health coverage, the waiting period may not extend 90 days, according to the final regulations.
The rulings note that the maximum time for an employment-based orientation cannot exceed one month--during this time, the employer and employee will determine whether the employment situation suits both parties and then training will begin.
The final regulations apply to group health plans and group health insurers for plans beginning on or after Jan. 1, 2015. Approximately 4.1 million new employees have group health insurance coverage, while 1 million are enrolled via a public sector employer. About 30 percent of these workers had a wait time of three months or more.
The probationary period is meant for plan sponsors to determine if an employee is eligible for coverage, yet this period must not exceed the 90 days because health effects could result, according to the rulings. A delay in treatment also could lead to lower work productivity.
What's more, the new rules also require most large and mid-size employers to offer "minimum essential coverage" (MEC) to employees. If employers fail to offer MEC, and their employees end up enrolling on the public exchanges, the employer may have to pay penalties.
Just as healthcare reform affects benefit designs and procurement sources for group health plans, it now will affect coverage onset dates, as FierceHealthPayer reported regarding the previous rules issued in February. Many employers consider themselves unprepared to meet various reform requirements, so they are seeking new ways to manage and deliver employee health insurance benefits.
For more:
- here's the LifeHealthPro piece
- here are the rules (.pdf)