Health Care Reform

Plan Design

Employers maintaining group health coverage need to incorporate additional plan design rules to provide minimum value, in order to comply with the Affordable Care Act and avoid expensive penalties.

As of January 1, 2015, ACA plan design mandates were implemented and include:

  • Complete elimination of all annual dollar limits on Essential Health Benefits
  • Elimination of all pre-existing condition exclusions, regardless of participant age
  • Any employer with 100 employees or fewer, who offers coverage through a fully-insured plan, must provide plans with deductibles under $2,000/$4,000
  • Out-of-pocket limits cannot exceed the HSA-compatible HDHP guidelines
  • The ACA defines a full-time employee, for the purposes of benefits eligibility, as any employee who works either an average of 30 hours per week or 130 hours per month. Accurate classification of employees is vital, as it helps your business avoid ACA penalties.
  • Waiting period cannot exceed 90 days
  • Stand alone HRAs are no longer permitted

Learn More About Employee Classifications

  • Full-time: Average 30+ hours a week (or 130+ per month). Full-time employees must be offered eligibility for the employee’s group health plan.
  • Part-time: Average 29 hours a week or fewer. No eligibility is required.
  • Variable-hour: At time of hire it cannot be reasonably determined if the employee will work 30 hours a week or not.
  • Seasonal: Customary annual employment does not exceed 6 months and whose work begins and ends around the same time each year (ex. holiday retail, summer landscape, ski instructor, etc.)