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787-759-3170

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FINAL REGULATIONS ON PPACA's 90 DAYS WAITING PERIOD APPLICABLE TO HEALTH CARE PLANS

 

The United States Departments of Labor, Treasury and Health and Human Services (the "Departments") issued final regulations regarding the 90-day waiting period limitation provided under Section 2708 of the Public Health Service Act ("PHS Act").

 

Section 2708 of the PHS Act provides that a group health plan or health insurance issuer offering group health insurance coverage shall not impose any waiting period that exceeds 90 days. On March 21, 2013 the Departments issued proposed regulations based on guidance issued on 2012. Last week the Departments issued final regulations applicable to group health plans and health insurance issuers offering group health insurance coverage.

 

In summary:

 

group health plans and health insurance issuers offering group health insurance coverage may not apply a waiting period that exceeds 90 days;

 

"waiting period" is defined as the period that must pass before coverage for an individual who is otherwise eligible to enroll under the terms of a group health plan can become effective;

 

if a group health plan conditions eligibility on an employee regularly having a specified number of hours of service per period (or working fulltime) and it cannot be determined whether a newly-hired employee is reasonably expected to regularly work a specified number of hours per period (or work full-time), the plan may take a reasonable period of time, not to exceed 12 months to determine whether the employee meets the plan's eligibility condition;

 

if a group health plan or group health insurance issuer conditions eligibility on the completion by an employee (part-time or full-time) of a number of cumulative hours of service, the eligibility condition is not considered to be designed to avoid compliance with the 90-day waiting period limitation if the cumulative hours-of-service requirement does not exceed 1,200 hours;

 

after an individual is determined to be otherwise eligible for coverage under the terms of the plan, any waiting period may not extend beyond 90 days, and all calendar days are counted beginning on the enrollment date, including weekends and holidays;

 

the final regulations amend the evidence of creditable coverage provisions of HIPAA regulations (26 CFR 54.9801-5, 29 CFR 2590.701-5, and 45 CFR 146.115).

 

The final regulations also provide that a requirement to successfully complete a reasonable and bona fide employment-based orientation period may be imposed as a condition for eligibility for coverage under a plan.

 

The 90-day waiting period limitation provisions of these final regulations will be effective for group health plans and group health insurance issuers for plan years beginning on or after January 1, 2015. The amendments to the evidence of creditable coverage provisions of HIPAA regulations will become effective beginning on December 31, 2014. All other amendments made by the final regulations will be effective for group health plans and health insurance issuers for plan years beginning on or after April 25, 2014.

 

The Final 90-days Waiting rule can be accessed here.

 

The Labor Law Group at Fiddler González & Rodríguez, P.S.C., will issue the FGR LABOR WATCH with information of legal issues and developments in areas of interest to our friends and clients. If you know anyone who would like to receive the FGR LABOR WATCH, please feel free to forward this newsletter. For more information about any matter raised in this Labor Watch, please contact your usual FGR labor lawyer or José A. Silva Cofresí at jsilva@fgrlaw.com.

©2014 FIDDLER GONZÁLEZ & RODRÍGUEZ, P.S.C. Permission is granted to view, store, print, copy or distribute the content of this newsletter for noncommercial or personal use, provided you do not alter it and you give us proper credit. The content of this newsletter is for informational purposes only. It is not legal advice or advertising. In addition, the above discussion has been provided in general terms and, therefore, should not be relied upon as legal advice applicable to a specific set of facts and circumstances. Before taking legal action, consult a lawyer you trust. Although we will try to be accurate, you cannot rely on its applicability to your specific problem without consulting your lawyer. Fiddler González & Rodríguez, P.S.C. and the members of the Labor Law Group assume no responsibility to inform you of additional changes in law or any other legal issues related to matters addressed in this email of which we may become aware after the date hereof. This newsletter is not intended to create an attorney-client relationship between you and our firm or any of our attorneys. If we are not already representing you, be mindful that your email communications to any of our lawyers will not be treated as privileged or confidential until you ask us to represent you, we first conduct a conflict of interest search, we agree to represent you and you sign an engagement letter from the law firm.

***IRS CIRCULAR 230 DISCLOSURE: To ensure compliance with requirements imposed by the Internal Revenue Service, we inform you that any United States federal tax advice in this communication (including any attachments) is not intended or written by Fiddler González & Rodríguez, P.S.C. to be used, and cannot be used, for the purpose of (i) avoiding any penalties under the Internal Revenue Code, or (ii) promoting, marketing or recommending to another party any transaction or matter addressed herein. **

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