The Affordable Care Act (ACA) has undoubtedly affected most companies and their move toward organization to address the ACA. Although more businesses may become familiar to the mandates proposed by the ACA, certain elements of compliance may still fall through the cracks, such as the need to ensure ACA compliant employee handbooks. It is imperative that your new and existing employees are informed of new information that directly applies to your company and their rights as employees (or equivalents). Here are some DOs and DON’Ts for ACA compliance as it pertains to your employee handbooks.
DON’T forget to update your handbooks
Your company may be fully compliant with the Affordable Care Act’s procedures, but if the employee handbook doesn’t reflect such compliance or is not properly updated, your efforts may be for naught, especially once an audit rolls around, as both the IRS and the Department Of Labor may request copies for examination.
DO be explicit with the health care coverage offered to employees
The Affordable Care Act makes it mandatory for all large employers—i.e., those with 50 or more full-time employees/equivalents—to offer health care coverage to their 30+ hours a week employees. Failure to do so runs the risk of per-employee penalties that can undoubtedly add up. Within your handbook, make that the criteria for eligibility for the health care coverage complies with the ACA. Should employees waive their coverage, situations such as those can be handled with other documentation. However, you can protect your company from penalties by stating such eligibility right off the bat.
DON’T discount your full-time equivalent employees
Under the Affordable Care Act, anyone employed by your company for 30 or more hours per week is eligible for an offer of health care coverage. That may include “interns,” “temps,” and “part-timers.” The ACA defines who is eligible based on the hours of service and not the titles the company gives to such workers. Your company needs to supply such workers with an employee handbook (often an oversight by employers). These workers may be eligible for health care and you as the employer will want to ensure that they are offered coverage if they fall within the eligibility definition.
DO reflect a legal waiting period for health care in your handbook
90 days is the maximum acceptable waiting period for health care under the Affordable Care Act. Not three months (as some months have 31 days), and not the day after the 90th day (as that exceeds 90 days). Be firm in your language that 90 means 90, because an overage of days will come back to haunt you.
We’re committed to helping companies reduce risk, avoid penalties, and achieve 100% ACA compliance. For questions about the ACA contact us here.