Employee Benefits Update - March 2014

AGENCIES ISSUE FINAL RULES PROHIBITING WAITING PERIODS IN EXCESS OF 90 DAYS

The Departments of Labor and Health and Human Services and the Internal Revenue Service (collectively, the Agencies) have issued the final rules implementing the Patient Protection and Affordable Care Act (ACA) prohibition on waiting periods in excess of 90 days. Under the 90-day waiting period rule, a group health plan cannot generally require an eligible individual to wait more than 90 days before coverage becomes effective. The final regulations largely incorporate the rules set forth in the proposed regulations, with some clarifications. Additionally, the agencies issued proposed regulations describing a new "bona fide employment-based orientation period" that can be used in conjunction with the 90-day waiting period.