The Wagner Law Group
Wagner Law Group, A Professional Corporation, is a nationally
recognized ERISA & employee benefits, estate planning,
employment, labor & human resources practice.
in 1996, The Wagner Law Group has 22 attorneys engaged
exclusively in employee benefits, estate planning and
employment law. Six of our attorneys are AV rated by
Martindale-Hubbell as having very high to preeminent legal abilities
and ethical standards. The firm is among the largest ERISA boutiques
in the country. Our practice is national in scope, with clients in
more than 40 states and several foreign countries.
Wagner Law Group
Fax: (561) 293-3591
7108 Fairway Drive
Palm Beach Gardens, FL 33418
East Kennedy Boulevard
Tampa, FL 33602
Francisco, CA 94104
100 South 4th Street, Suite 550
St. Louis, MO 63102
February 19, 2016
Health and Welfare Law
Agencies Release Guidance on
ACA Issues Impacting Student Employees
and HHS (collectively, the "Agencies") have jointly issued
Notice 2016-17, which provides guidance to institutions of higher
education (i.e., colleges and universities) on compliance with
certain group market reform provisions of the Affordable Care Act
("ACA"), including the issue of whether the school may
offer premium reduction arrangements to its students. Notice 2016-17
also provides a temporary transition period for non-compliant
employers to come into compliance with the ACA market reform mandates
and avoid enforcement actions by the Agencies.
Background. Many colleges and universities provide students
with student health coverage at greatly reduced (or no) cost. Student
health coverage can be provided either through individual health
insurance or through coverage that is self-insured by the school. In
many cases, the premium for student health coverage may take into
account a premium reduction arrangement. Because some students also
perform services for the school (e.g., teaching or research),
it is possible that such premium reduction arrangements might be
viewed by the Agencies as employer-sponsored group health plans that
violate the ACA's market reform provisions.
Agencies issued guidance in 2013 which provides that an employer
payment plan ("EPP") (i.e., a group health plan that
directly reimburses employees for all or some of the premium costs
incurred for individual market coverage) or a health reimbursement
arrangement ("HRA") could only comply with the ACA to the
extent that the EPP or HRA was integrated with a group health plan.
This is because the ACA prohibits annual dollar limits on essential
health benefits, and by their definition, EPPs and HRAs are limited
to the amount credited to the EPP or HRA.
federal law, student health plans are treated as individual health
policies that are not part of a group health plan. Thus, student
health plans cannot be integrated with an EPP or HRA, at least with
respect to students who are employees of the university or college
sponsoring the student health plan. Accordingly, to comply with ACA's
market reform requirements, institutions of higher education must
obtain alternative coverage for affected student-employees.
Relief. Notice 2016-17 provides
a transition period so that colleges and universities can find
replacement group coverage for affected student-employees. Under this
transition period, colleges and universities will have until the
first day of the first policy or plan year beginning on or after
January 1, 2017 to provide students who are full-time employees with
an offer of coverage that complies with the ACA.
EXAMPLE: If a student-employee's policy year runs from
September 1 through August 31, the college or university will have
until September 1, 2017 to offer the student-employee group health
coverage that is compliant with the ACA or face a penalty under the
(ACA's) employer mandate.
for Employers. Educational
institutions must carefully reconsider the health coverage offered to
students-whether the students are employees or not and whether the
coverage is student health coverage or coverage under an employer's
group health plan-to ensure that all coverage offered meets ACA
requirements. However, they should also bear in mind that the
Agencies may reconsider their current position on this matter.
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