Affordable Care Act

Benefits Eligibility Changes Beginning in 2016 - Affordable Care Act and Employer Shared Responsibility

The Employer Shared Responsibility provision of the Affordable Care Act of 2010 (ACA) requires large employers to offer medical coverage to “substantially all” full-time employees. The provision’s definition of full-time is any employee expected to work 30 average hours per week.  This will require significant changes to the University’s benefits eligibility rules starting in 2016, including the expansion of benefits eligibility to employees previously considered ineligible, including:

  • Student employees (hours paid under Federal Work Study programs are excluded from the 30 average hours/week calculation)
  • Graduate Student employees with cumulative appointments that average 75%, or greater
  • Staff employed in “per diem” appointments
  • Academic, staff and students employed and paid under a flat-dollar arrangement, such as By Agreement (BYA) and  Summer Session salary

UC will offer these previously ineligible categories of employees the Core Benefits Package (Core medical and Core life) on Date of Hire (01/01/2016 or later), if they meet the eligibility requirement: appointed at 30 hours/week (75%) for 3 months or more.  

The ACA requires only that employees be offered coverage; it does not require that employees enroll in the plan.  Therefore, effective January 1, 2016 all employees who do not take action to enroll will NOT be automatically enrolled in default medical coverage.  Likewise, beginning in 2016, there will be no default enrollment in dental or vision coverage for qualified employees.  All employees must take action to elect coverage, according to their benefit-eligibility level indicator (BELI) within their Period of Initial Eligibility (PIE).

CONTINUING EMPLOYEES

The changes in UC’s benefits eligibility rules will take effect on January 1, 2016, but determination of eligibility for continuing employees in the categories listed above is based on a calculation of hours worked during a 12-month “look back” measurement period which started in November 2014.  Accordingly, employees in previously-ineligible categories (listed above) may qualify for UC insurance in 2016, based on their average hours of service between November 2014 and October 2015.  Employees found to have worked an average of 30 hours/week may qualify for an offer of coverage.

All existing UC medical plans will be available in 2016, and UC will still offer all three benefits packages – Full, Mid-Level and Core (BELI 1, 2 & 3 and 4, respectively).

The look back measurement for average hours of service will be the new measure for continued eligibility for all UC employees going forward (BELI levels 1, 2, 3 and 4).  The Standard Measurement for continued benefits eligibility will replace the “rolling 12 months” measurement previously in place at UC. The Standard Measurement Period (SMP) will occur annually after the end of October each year.  Employees eligible for benefits will remain eligible, as long as employed, until a Standard Measurement calculation can be performed.  Therefore, employees who have experienced employment changes (for example, transfers, promotions, demotions, voluntary reductions in time) may have eligibility for UC benefits program for longer periods than in the past.  Managers and supervisors should consider continued benefits eligibility, and the longer periods of eligibility provided for under the ACA provision, and budgetary impacts associated with continued benefits eligibility.

CHANGING BENEFIT ELIGIBILITY RULES

In compliance with ACA, UC will be revising benefits eligibility rules set forth in UC Group Insurance Regulations.  Below is an overview of the changes.  Overall, these changes make it easier for UC employees to qualify for benefit coverage.

Item From To (Beginning 1/1/16) Details
Hours included for benefit eligibility Average regular paid time Average weekly hours of service Hours of service refer
to any and all paid time* plus special unpaid time.**
Measurement method Average regular paid time calculated monthly using a rolling 12-month period Average weekly hours of service calculated annually using a 12-month look-back period Look-back period will begin and end about the same time each year. Example for 2015:
  • Monthly payroll Nov. 1, 2014 – Oct. 31, 2015
  • Biweekly payroll Nov. 9, 2014 – Nov. 7, 2015
Measurement frequency Month-to-month Year-to-year If your hours of service after the 12-month look-back qualify you to continue coverage, it will continue through the entire next calendar year; otherwise, it will end and in most cases you won’t be eligible until you are next measured.

*Paid time includes all time for which you are granted pay. In addition to work hours, it includes sick time, vacation, holidays, paid leave of absence, paid jury duty and paid military duty.

**There are four types of special unpaid time: Unpaid Family and Medical Leave Act (FMLA) leave, unpaid Uniformed Services Employment and Reemployment Rights Act (USERRA) leave, unpaid jury duty and unpaid hours during “special employment breaks” of at least 4 weeks.

MORE INFORMATION

More information and articles from UC on the Affordable Care Act may be found at the following links: