Affordable Care Act - Frequently Asked Questions
Q: What is the Affordable Care Act (ACA)?
Q: What is the individual mandate and when does it take effect?
Q: What is the employer mandate and when does it take effect?
Q: How does the ACA define a full-time employee?
Q: Who is considered a variable-hour employee?
Q: What is the measurement period?
Q: What is the administrative period?
Q: What is the Stability Period?
Q: What is a Seasonal Employee?
Q: What happens when the College hires a new temporary employee?
Q: Who is considered an “ongoing” employee vs. a “new” employee?
Q: What if a temporary employee works multiple temporary jobs for the College?
Q: What is a Break in Service and how will coverage be determined if there is a Break in Service?
Q: Are Student Employees eligible for coverage under the ACA?
Q: What health benefits will be extended to the College’s full-time temporary employees under the ACA?
Q: Which temporary employees will not be offered health insurance coverage?
Q: How will premiums be collected for employees who do not work all 12 months of the year?
NOTICE: The rules, processes and procedures as described in these FAQs are subject to change at any time as we receive further guidance and clarification from the State PEBA or the IRS.
Q: What is the Affordable Care Act (ACA)?
The Patient Protection and Affordable Care Act (PPACA), commonly called the Affordable Care Act (ACA) or "Obamacare," is a United States federal statute signed into law by President Barack Obama on March 23, 2010. This new law is complex, multi-faceted and has an impact on both individuals and employers. The “Individual Mandate” in the law required that most Americans have medical insurance by January 1, 2014. People not covered by medical insurance in January, 2014 may have to pay a tax penalty. In addition, the “Employer Mandate” in the law requires that employers with 50 or more full-time employees, like the College of Charleston, offer healthcare insurance to full-time employees and their dependent children up to age 26. The College already offers healthcare insurance to benefits-eligible employees in FTE positions.
Q: What is the individual mandate and when does it take effect?
The individual mandate portion of the law required that most Americans have healthcare insurance by January 1, 2014. The law is intended to ensure that Americans have access to medical insurance they can afford, whether they get it from an employer, an insurance company or from the government. People who are not covered by healthcare insurance beginning in 2014 may have to pay a tax penalty.
Q: What is the employer mandate and when does it take effect?
The employer mandate was initially scheduled to take effect January 1, 2014, but was delayed by the federal government to now begin January 1, 2015. The employer mandate is a requirement that all businesses with over 50 full-time equivalent (FTE) employees provide health insurance for their full-time employees and their dependent children younger than age 26. This includes full-time temporary employees.
Q: How does the ACA define a full-time employee?
Under the ACA, full-time employees are those who consistently work 30 or more hours per week and those variable-hour employees who average 30 hours or more per week over a determined measurement period.
Q: Who is considered a variable-hour employee?
Employees are considered variable-hour if the College cannot determine if they are reasonably expected to work on average at least 30 hours per week, based on the facts and circumstances at the start date. Variable-hour employees could be either part-time or full-time employees for ACA purposes, depending on how many hours they work. In order to determine eligibility, variable-hour employees’ work hours will be considered over a standard measurement period as prescribed by the South Carolina Public Employee Benefit Authority (PEBA). The College will measure all employees during the measurement period to determine eligibility for healthcare coverage.
Q: What is the measurement period?
In accordance with guidance from PEBA, the initial measurement period is for the 12-month period from October 4, 2013 through October 3, 2014. Those employees qualifying for healthcare coverage will be notified in writing by early October, 2014, to allow enrollment or refusal of coverage during open enrollment, which will be October 4-31, 2014.The subsequent annual 12-month standard measurement period for all ongoing employees will be October 4 – October 3 each year.
If at the time of hire, a new variable hour employee is reasonably expected to consistently work 30 hours or more per week, the employee may be immediately eligible for coverage. However, if the new employee is offered coverage immediately, the employee’s hours will be monitored and coverage may be terminated if the employee does not consistently work 30 hours or more per week.
The work hours of all new variable hour employees will be assessed over a measurement period of one year beginning on the 1st of the month following their start date. If they are first determined to be eligible for coverage upon conclusion of the one-year measurement period, coverage will be extended and made effective the 1st of the month following the 30 day period after the measurement. If a newly hired variable-hour, part-time, or seasonal employee averages 30 hours or more per week over the initial measurement period (excluding any breaks in service), the employee will have an initial stability period for coverage for 12-months following an administrative period. Example: Bob is hired 03/15/2014. As a variable-hour employee (with no reasonable expectation that he will be full-time), his measurement period is 4/1/2014 through 03/31/2015. If eligible and he elects healthcare coverage, it will be effective: 5/1/2014. The administrative period will be the month of April, 2015. If eligible and coverage is elected, his stability period will be 5/1/2015-4/30/2016.
Q: What is the administrative period?
This is the period of time between the end of the measurement period and the beginning of the stability period. As a part of the administrative period, an employer may look back at and calculate its employees’ hours of work during the previous measurement period, make eligibility determinations, notify employees of their full-time status, and enroll or un-enroll employees from health care coverage. In accordance with guidance from PEBA, the initial administrative period will be from October 4 – December 31, 2014. The subsequent annual administrative period will be from October 4 – December 31 each year.
Q: What is the Stability Period?
The stability period is a fixed period of time over which an employer must provide healthcare coverage to a full-time, variable-hour employee. A stability period must begin immediately after the end of the standard measurement period and any administrative period. An employee’s full-time status is determined by their average hours of service during the previous standard measurement period.
The College will use a 12-month stability period for ongoing employees from January 1– December 31 each year as set forth by PEBA. For newly-hired variable-hour employees, once the initial 12-month measurement period is completed and he/she is declared eligible for coverage, the employee will have an initial stability period for coverage for 12-months following an administrative period. After an initial measurement and stability period, new employees will transition into the standard measurement and stability periods.
Q: What is a Seasonal Employee?
A seasonal worker is an employee who is hired into a position for which the customary annual employment is for a period of six months or less and where the work performed is the kind typically performed at certain seasons or periods of the year. Seasonal employees are not immediately eligible for coverage under the ACA, but they will be measured during an initial measurement period.
Q: What happens when the College hires a new temporary employee?
When the College hires a new, non-seasonal temporary employee or adjunct, the College will consider whether there is a reasonable expectation that the new employee will work an average of 30 hours or more per week. A newly-hired temporary employee who is reasonably expected to work full-time (an average of 30 or more hours per week) as of the first day of employment will be offered health care coverage within 31 days of the start date. The employee must remain a full-time employee until he or she has worked a complete standard measurement period. If the employee does not consistently work an average of 30 hours per week or more, healthcare coverage may be terminated. Once the employee has worked a full measurement period, the employee’s full-time status is calculated and determined the same as every other ongoing employee during the standard measurement period. A stability period will then apply if the employee measures as full-time.
Q: Who is considered an “ongoing” employee vs. a “new” employee?
An ongoing employee is one who has been employed by the College for at least one complete standard measurement period. The College’s standard measurement period for an “Ongoing” employee will be 12 months (October 4 – October 3 annually). Unlike ongoing employees, a new employee is one who has not been employed for at least one standard measurement period. The ACA includes additional special rules for new employees in two categories: (1) reasonable expectation of full-time, non-seasonal employees, and (2) variable hour, part-time and seasonal employees.
Q: What method will the College use to track the work hours of temporary employees (excluding adjunct faculty)?
Human Resources will monitor and track actual work hours as recorded by employees in Banner. For departments employing FLSA exempt temporary employees who do not keep timesheets, Human Resources will rely upon guidance from managers on expected work hours for these employees. In addition, temporary contracts will indicate expected work hours. See section below for information on adjunct faculty.
Q: What if a temporary employee works multiple temporary jobs for the College?
The work hours for all concurrent temporary jobs worked at the College during the measurement period will be combined in making healthcare coverage eligibility determinations.
Q: What if a temporary employee who works at the College also works other temporary jobs at other SC State agencies or outside employers?
Only work hours for jobs at the College will be considered in making healthcare eligibility determinations. Work for other state agencies or employers will not be combined with hours worked at the College in accordance with guidance from PEBA.
Q: How will the College calculate hours worked for Adjunct Faculty in determining eligibility for coverage?
The College will credit adjuncts with 3.0 hours of work for every 1 hour of course credit taught and every 1 hour of lab contact taught. Accordingly, full-time adjunct faculty may become eligible for employer-sponsored health insurance under the ACA if they teach at least 10 or more credit hours per semester (30 work hours/week) or combination of credit hours and lab contact hours. In some exceptional cases, departments may need to increase an adjunct faculty member's hours of work credited to take into account non-credit labs, advising, outreach, or other departmental assignments beyond the normal expectation for adjunct faculty. The Provost’s Office will be responsible for making all determinations related to adjunct eligibility for health coverage and for notifying Human Resources accordingly.
Ongoing adjuncts who have been employed since October 4, 2013 will be offered coverage for the initial stability period (defined above) based on their calculated average weekly hours worked during the initial measurement period of October 4, 2013 through October 3, 2014.
When calculating the average work hours for adjunct faculty, the summer break term (May 16-Aug 15) will not be included in the averaging if the adjunct does not work during that time. Summer teaching for a given session will be included in the averaging only if it meets a specified threshold set for that session based on the length of the session. Those thresholds will take into account the 30-work-hour benchmark and the faster pace of each summer session.
When a non-seasonal new adjunct is hired, the adjunct will be immediately eligible for coverage if they are being credited with 30 or more adjunct work hours/week, as outlined above, during their first semester. The coverage will only continue during the first year if the new adjunct continues to earn 30 or more adjunct work hours/weekly in the following semester. For all new adjuncts (even those offered coverage immediately), the initial measurement period will begin on the 1st of the month following their start date and will continue for 12 months. The weekly work hours credited to the adjunct will be averaged over this initial measurement period to determine eligibility for coverage during a subsequent initial stability period.
Once an adjunct has completed a full measurement period and is deemed eligible for health insurance coverage and the offer is extended for enrollment, if the adjunct then remains employed with the College, the adjunct will remain eligible for coverage for the full 12-month stability period going forward regardless of the number of hours worked during that stability period. Subsequently, the adjunct will transition to the College’s standard measurement and stability periods.
Q: What is a Break in Service and how will coverage be determined if there is a Break in Service?
A break in service is a period of time during which an employee is not credited with any hours of service for a period of between 4 and 26 consecutive weeks. If an employee leaves employment (through resignation or termination for example), coverage will end on the first of the month after the last day worked. If the employee, who is in a stability period, returns to employment at the College within 26 weeks, they are eligible to re-enroll in the same benefits they had when they left employment (through the end of the stability period). The full-time status for the stability period during which the continuing employee resumes service is based on their hours of service during the corresponding measurement period. When calculating an employee’s hours of service during a measurement period that includes a break in employment of more than 4 consecutive weeks (such as a summer break), during which the employee is not credited with any hours of service, the break in service will be excluded for purposes of determining average hours worked per week. When calculating an employee’s hours of service during a measurement period that includes a break of less than 4 consecutive weeks, the break of less than 4 weeks will be included for purposes of determining average hours worked per week. For a break in service that is more than 26 weeks, the employee will be treated as a new employee upon their return.
Q: If an employee is married to a PEBA subscriber, can the employee refuse coverage as an active employee and remain covered as the spouse of a PEBA subscriber?
No. If eligible for his/her own benefits, he/she cannot remain covered as a dependent of another PEBA subscriber.
Q: If the College offers healthcare coverage to an employee, is the employee required to enroll in coverage?
No, unless the employee is married to and covered as a dependent by another PEBA subscriber.
Q: Are Student Employees eligible for coverage under the ACA?
The ACA does not exempt students who are also employees of the College. The Final Regulations, however, do contain an exemption for hours of service performed by students under a federal or state work-study program. In addition, unpaid student interns are likewise not eligible for coverage. Accordingly, the ACA requires that the College measure work hours and provide an offer of healthcare insurance to non-work study and non-student intern student employees who work for the College and average at least 30 hours per week over the measurement period.
Q: What health benefits will be extended to the College’s full-time temporary employees under the ACA?
The South Carolina Public Employee Benefit Authority (PEBA) will offer health (Standard Plan or Savings Plan), dental, vision, Dependent Life, Optional Life, Supplemental Long Term Disability, and MoneyPlus features which include the pre-tax premium feature, health savings account (if enrolled in the Savings Health Plan), medical spending account, and dependent care spending account. The determination of benefits offered under this program is made solely by PEBA.
Q: Which temporary employees will not be offered health insurance coverage?
Temporary employees who are considered seasonal workers and those who average less than 30 hours per week will not be entitled to healthcare coverage through the College.
Q: How will premiums be collected for employees who do not work all 12 months of the year?
For employees who do not work all 12 months of the year (for example, adjunct faculty who do not teach in the summer or 10-month coaches), premiums will be collected from payroll deductions that will be pro-rated based on the number of paychecks received during the year. For example, if coverage extends through the summer for an adjunct who is not working in the summer, the premiums for the summer months will be deducted pro rata from paychecks during the Spring semester. HR benefits coordinators will provide additional information upon request.
NOTICE: The rules, processes and procedures as described in these FAQs are subject to change at any time as we receive further guidance and clarification from the State PEBA or the IRS.