SHRM pushes back against PPACA’s 90-day rule

The Society for Human Resource Management is hoping regulators overseeing the implementation of health care reform will reconsider how they define 90 days.

Under the Patient Protection and Affordable Care Act, employers would be forced to limit waiting periods before health benefits kick in for new employees to no more than 90 calendar days.

SHRM, in comments submitted to the government this week, pointed out that employers commonly offer coverage to workers starting on the first day of the month after 90 days of employment, or the first payroll period following some waiting period.

“Many small and medium employer plans would be out of compliance with the approach taken in the proposed regulations that would limit waiting periods to no more than 90 calendar days,” wrote Michael P. Aitken, SHRM’s vice president for government affairs.

Aitken noted that most smaller employers “simply do not have the staff nor resources to undertake the changes to processes, systems, communications, and other functions that would be needed to switch from current practice to a strict 90 calendar day waiting period at the same time as significant other changes must be implemented to comply with different [PPACA] provisions taking effect in 2014.”

In its effort, SHRM also said a three-month waiting period helps prevent adverse selection, where an individual accepts a position solely to obtain health insurance to cover a medical condition, which could “impose unfair risk on an employer.”

 

 

 

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