Tuesday, May 31, 2011

U.S. Health Care Reform: Beginning to address seasonal employees

Earlier this month, the U.S. Treasury, Department of Labor, and Internal Revenue Service (IRS) released a “Request for Comments on Shared Responsibility for Employers Regarding Health Coverage,” which solicits input on several issues regarding the employer responsibility provisions of the Patient Protection and Affordable Care Act (PPACA). The intent is to use the comments it receives from this request to shape the rules it proposes on the employer responsibility provisions.

This is the first opportunity the attractions industry has to solicit clarification on the full-time vs. seasonal employee issue. As you may remember, during the legislative debate IAAPA tried to clarify the differences between full-time, year-round employees and seasonal workers who work more than 30 hours per week for a few consecutive months.

The Request for Comments addresses the following issues:
• The definitions of employer, employee, and hours of service (Section III)
• Determination of whether an employer is an applicable large employer (Section IV)
• Potential methods for determining full-time employees (Section V), including a possible “look-back/stability period safe harbor method” – MORE BELOW
• How provisions of PPACA that establish assessable payments for not offering minimum essential coverage to eligible employees will be interpreted and applied, and situations where appropriate exceptions should be provided (Section VI(A)).
• The 90-day limitation on wait periods and how it applies in certain situations (Section VI(B))

Under the possible look-back/stability period, an employer would determine each employee’s full-time status by looking back at a defined period of three to 12 months, as chosen by the employer, to determine whether the employee averaged at least 30 hours of service per week (or 130 hours per calendar month). If an employee met this obligation during the look-back period, then he would be treated as a full-time employee during a subsequent “stability period,” regardless of the number of hours of service he worked during the stability period, provided he remained an employee.

The business would be required to enroll the employee in its health insurance program or pay the penalty during the stability period. The stability period could be longer than the look-back period, but not shorter. The look-back/stability process would continue on a rolling basis.

IAAPA intends to submit comments in response to this request, but we need to know how these proposals would work for member companies. Comments are due June 17, so please email us your thoughts by June 10.

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