Measurement Method: Do You Know Who Your Full-Time Employees Are? a large employer with 2,000 employees. Its health plan year runs from October 1 through September 30 with open enrollment occurring each September. Compliance executives have of course heard of the Affordable Care Act ("ACA") and the Employer Mandate, but have taken a "wait-and-see" attitude toward implementation. It's now past January 1, 2015, the effective date of the Employer Mandate for employers of its size, and Compliance needs to know what it must do to satisfy the ACA's requirement that it offer coverage to its full-time employees. Lucky for Compliance, it's not too late. that so long as certain conditions are met, the sponsor of a non-calendar year health plan may wait until the first day of the plan year following the effective date of the Employer Mandate to offer its full-time employees coverage. coverage to its full-time employees by October 1, 2015, the first day of the plan year following January 1, 2015. So, now that Compliance has some additional time, how does its human resources department determine which employees are entitled to coverage? Under the ACA, employees hired full-time (expected to average at least 30 hours a week) must be offered health coverage by the first day of the fourth calendar month of employment. employees who are already participating in the plan. Most other employees are known as "variable hour employees." These are employees who are not reasonably expected to work an average of 30 hours per week. However, regardless of expectations, some variable hour employees may surpass this threshold on occasion. For this reason, the ACA provides a system of measurement and stability periods to determine which time and must be offered coverage. Under the look-back measurement method, an employee's status as full-time or part-time is based on a designated measurement period and governs the employee's status for a subsequent stability period. an employer is responsible for choosing: the "Standard Measurement Period" and the "Initial Measurement Period." The Standard Measurement Period is applied to "Ongoing Employees." These are employees who have been employed for a complete Standard Measurement Period. The Standard Measurement Period can be three to 12 months in length, with a subsequent stability period that can be six to 12 months in length. the Standard Measurement Period to allow the employer time to process the data collected and to offer coverage to group at Kennerly, Montgomery & Finley. She assists private and governmental clients in the design, implementation and maintenance of their employee benefit plans. Ashley focuses much of her time on assisting clients with issues related to the Affordable Care Act and is a frequent speaker on such issues. 550 Main Street, W Knoxville, Tennessee 37902 865.524.1773 Fax kmfpc.com |