When are employees eligible for health insurance?
“To sum it up…”
- Newly hired full-time employees may be subject to a waiting period of up to 90 days before they are eligible for health insurance
- There are some complications to this waiting period requirement if you are a variable hour employee or other extenuating circumstances
- Your job is not required to provide you with health insurance if you are a part-time employee
- Larger companies are required to offer health insurance to their full-time employees or they may be responsible for paying a penalty fine
What is the waiting period for health insurance for newly hired full-time employees?
The standard waiting period for newly hired full-time employees is 90 days. Employers can make this a shorter period at their own discretion, but they cannot make it longer than the 90-day limit.
Employees have the choice to wait longer than the 90 days before accepting coverage if they choose, but the employer has to offer health insurance.
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Are there exemptions or complications associated with this waiting period?
There may be extenuating circumstances that affect this waiting period. For example, if your job does not offer health insurance until you have met certain other requirements, such as completing an actual orientation program, the 90-day waiting period may not necessarily apply under these conditions.
Another circumstance that may affect this waiting period is if you are considered a variable hour employee.
If you are hired as a part-time employee, but there is the potential or likelihood that you will become a full-time employee, your employer can wait up to a year before determining if you are a full-time employee and then proceed to offer you health insurance.
However, after the year of you being a variable hour employee has concluded, your employer cannot add the 90 days on to your waiting period after becoming a full-time employee.
Under these circumstances, your employer must offer you health insurance within 13 months after your start date.
Employers also have the option of setting hour of service requirements before even beginning the 90-day waiting period.
These service requirements cannot exceed 1,200 hours, are prohibited from being reapplied to an employee, and are only allowable for new hires.
What are my options if I am a part-time employee?
Employers are not required to offer health insurance to part-time employees. However, some employers will still offer the option.
If the insurance that your employer is offering is considered unaffordable based on your income or if it does not meet some standard minimum requirements, you may be eligible for savings and tax credits by purchasing a different plan through the healthcare marketplace.
If your employer does not offer insurance to part-time employees, there are still many options available to you to ensure that you have coverage.
You can usually purchase an insurance plan in the healthcare marketplace during the open enrollment period between November 1, 2016, and January 31, 2017.
Depending on your circumstances, you may be eligible for a special enrollment period that allows you to purchase a plan outside of these dates.
When you apply for a plan in the Health Insurance Marketplace, you will find out if you qualify for savings on your monthly premiums and additional costs based on your annual income and the amount of people who live in your home.
You will also find out if you qualify for free or low-cost health insurance options such as Medicaid and the Children’s Health Insurance Program (CHIP).
Is it mandatory for my employer to offer me health insurance?
The employer mandate included in the Affordable Care Act requires businesses with 50 or more full-time equivalent employees to offer their full-time employees health insurance.
If you work for a company of this size and consistently work 30 or more hours a week or a minimum of 130 hours a month for a period of 120 days, then it is necessary for them to offer you health insurance.
If your employer meets these requirements but is not offering you health insurance, they are responsible for paying a penalty fine.
The fee is $2,000 for each full-time employee without health insurance, with an exemption for the first 30 full-time employees.
If your employer does offer insurance, but it is not affordable or it does not meet the minimum essential coverage requirements, they will be responsible for paying either $3,000 per full-time employee receiving subsidies for their health insurance or $2,000 per full-time employee, minus the first 30 employees.
Employers are responsible for paying the cheapest of the two fines. This fee is typically only activated if one of the company’s full-time employees is shopping for an insurance plan in the healthcare marketplace.
If you work for a smaller company, they may not be responsible for providing you with health insurance. The employer mandate does not apply to businesses with 49 or less full-time equivalent employees.
Businesses with 25 or fewer full-time equivalent employees who all make an average wage of less than $50,000 may be eligible for employer tax credits through the Small Business Health Options Program.
In 2016, businesses with less than 100 full-time equivalent employees can shop in this marketplace, as well. This allows small companies to offer group plans to their employees at a lower cost while claiming tax credits.
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