Proposed regulations were issued on March 21, 2013 by the IRS, HHS and DOL, providing further clarification on the prohibition on excessive waiting periods for coverage under a group health plan under the Patient Protection and Affordable Care Act (the “Affordable Care Act”). Among other provisions, the proposed regulations confirm that the maximum permitted waiting period for coverage of an otherwise eligible employee to become effective, 90 days, includes all calendar days. Coverage must start no later than the 91st day. If the 91st day is on a weekend or holiday, coverage may be effective earlier, but not later. Eligibility criteria other than a waiting period may delay the start of coverage beyond the 91st day of service, but careful consideration should be given to the imposition of such criteria, as it may trigger penalties under the employer shared responsibility requirements of the Affordable Care Act. Employees may be given additional time beyond the waiting period to make an election for coverage, as long as it is possible for them to elect coverage on the 91st day.
These proposed regulations are effective January 1, 2014. If final regulations or other subsequent guidance issued is more restrictive than these proposed regulations, the effective date of those final regulations or other guidance will be no earlier than January 1, 2015. These requirements apply to grandfathered plans as well as non-grandfathered plans.The proposed regulations also propose the elimination of the requirement under HIPAA for issuance of certificates of creditable coverage. Once the elimination of pre-existing condition exclusions takes full effect beginning January 1, 2014 as required by the Affordable Care Act, the necessity of these certificates is also eliminated. This change, which would take effect as of December 31, 2014, pending final regulations, allows for some overlap in 2014.
To review the proposed regulations, go to http://www.gpo.gov/fdsys/pkg/FR-2013-03-21/pdf/2013-06454.pdf.
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