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The Wagner Law Group Description 

The Wagner Law Group, A Professional Corporation, is a nationally recognized ERISA & employee benefits, estate planning, employment, labor & human resources practice. 

 

Established in 1996, The Wagner Law Group has 23 attorneys engaged exclusively in employee benefits, estate planning and employment law. Seven 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.

 

 

 

 

 

Contact Info

The Wagner Law Group

 

  Integrity | Excellence

  

Massachusetts Office 

Tel: (617) 357-5200 

Fax: (617) 357-5250 

99 Summer Street 

13th Floor

Boston, MA 02110


Florida Office 

Tel: (561) 293-3590
Fax: (561) 293-3591
7108 Fairway Drive
Suite 125
Palm Beach Gardens, FL 33418

   

San Francisco Office

Tel: (415) 625-0002

Fax: (415) 358-8300

315 Montgomery Street

Suite 904

San Francisco, CA 94104

 

www.wagnerlawgroup.com

 

 

 

 

July 3, 2014

 

 State and Federal Law Alert

 

 

 

Guidance on Permitted Orientation Periods under PPACA

 

 

 

 

DOL, HHS and IRS have released final regulations providing guidance to employers and insurers on the maximum employment-based orientation period that can be imposed prior to the commencement of the 90-day waiting period of the Patient Protection and Affordable Care Act ("PPACA").

 

For plan years beginning on or after January 1, 2014, PPACA prohibits group health plans and health insurers from imposing (as a condition for eligibility for group health coverage) waiting periods in excess of 90 days. (See the Alert of 2/27/14.) The new regulations allow employers to require new employees to complete a reasonable and "bona fide employment-based orientation period" before becoming eligible for a group health plan if: (i) the orientation period does not exceed one month, and (ii) the maximum 90-day waiting period begins on the first day following the end of the orientation period. However the regulations do not define the term "employment-based orientation period."

 

The one-month orientation period can begin on any day of the calendar month and is calculated by adding one calendar month and subtracting one calendar day. For example, if an employee's start date is July 7, the last permitted day of the orientation period is August 6.

 

The final regulations also stipulate that when there is no corresponding date in the next calendar month, the last permitted day of the orientation period is the last day of the next calendar month. Thus, if an employee's start date is January 30, the last permitted day of the orientation period is February 28 (or February 29 if it is a leap year).

 

Employers that are subject to PPACA's employer shared responsibility provisions (i.e., the "employer mandate") need to determine how the orientation period rule interacts with the employer mandate. Specifically, the orientation period rule does not override the 90-day requirement.

 

Accordingly, an employer subject to the employer mandate cannot impose both a full one-month orientation period and a 90-day waiting period without some risk of becoming subject to the employer mandate penalty. Employers that desire to impose both an orientation period and waiting period before making group coverage available to newly hired employees are advised to work with qualified benefits professionals to structure orientation and wait periods that will allow them to avoid PPACA's costly employer mandate penalties.

 

 

 

 

This Newsletter is protected by copyright. Material appearing herein may be reproduced with appropriate credit.

  

Pursuant to Internal Revenue Service Circular 230, we hereby inform you that any advice set forth herein with respect to US federal tax issues is not intended or written by The Wagner Law Group to be used and cannot be used, by you or any taxpayer, for the purpose of avoiding penalties that may be imposed on you or any other person under the Internal Revenue Code.

 

This Newsletter is provided for information purposes by The Wagner Law Group to clients and others who may be interested in the subject matter, and may not be relied upon as specific legal advice.  This material is not to be construed as legal advice or legal opinions on specific facts. Under the Rules of the Supreme Judicial Court of Massachusetts, this material may be considered advertising.