Final Regulations Issued on 90-day Waiting Periods

On June 25, 2014, the DOL issued final regulations on the 90-day waiting period.  The final regulation set forth rules governing the relationship between a plan's eligibility criteria and the 90-day waiting period limitation.

The final regulations provide that being otherwise eligible to enroll in a plan means having met the plan's substantive eligibility conditions (job classification, licensure requirement or satisfying a reasonable and bona-fide employment-based orientation period).

Under the final regulations, 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 calendar days.  All calendar days are counted beginning on the enrollment date, including weekends and holidays.

The final regulations provide that one month is the maximum allowed length of an employment-based orientation period.  Under the regulations, one month is determined by adding one calendar month and subtracting one calendar day, measured from an employer's start date in a position that is otherwise eligible for coverage.

If an employer implements the orientation period it is important to note that compliance with the 90-day final regulations is not determinative of compliance with the Employer Shared Responsibility regulations to offer minimum value coverage to certain newly hired full time employees byt the first day of the fourth full calendar month of employment.  An employer that has a one month orientation period may comply with both regulations by offering coverage no later than the first day of the fourth full calendar month.

The final regulations includes examples and can be viewed by clicking here.