New Laws Shorten Employee Waiting Period For Insurance Coverage

An article by Jim McDonald entitled “New Laws Shorten Employee Waiting Period For Insurance Coverage,” was published in the Orange County Business Journal on November 18, 2013.

Many employers have required employees to wait awhile before becoming eligible for the employer’s health insurance plan. The typical waiting period was at least 90 days.

The employee would be eligible for coverage on the first day of the month following the 90th day on the job. This waiting period gave both the employer and the employee a chance to see if the job was a good fit before putting the employee on the employer’s benefit plan.

The Affordable Care Act and a California statute enacted in 2011 will shorten the waiting period for employees.

The ACA limits waiting periods to no more than 90 days for plan years beginning on or after January 1, 2014.

As a practical matter, this means that under federal law, a waiting period can be no longer than 60 days.

These shorter waiting periods will only apply to medical, dental and vision care plans.

An employer may still impose longer waiting periods before employees will be eligible for other types of benefits.

The article was also featured in the Irvine Chamber’s Business Connection.