Since some of our clients had questions about new rules on waiting periods, I thought this article by Susan Collins could be helpful for some of you out there.

The waiting – or probationary – period is the period of time set by an employer before coverage becomes effective for a new employee enrolling into the group’s health benefit coverage. Group health plans and health insurance carriers that offer group coverage may not apply a waiting period that exceeds 90 days. California law sets the limit at 60 calendar days (AB1083).

The waiting period provision applies to grandfathered and nongrandfathered plans, and to fully insured and self-insured/ASO groups. The rules took effect January 1, 2014 for new groups, and on or upon renewal for existing groups.

What is the Waiting Period?

The waiting, or probationary, period is the period of time set by an employer before coverage becomes effective for a new employee enrolling into the group’s health benefit coverage.

What are the Waiting Period Maximums?

Under the ACA provision, the maximum waiting period is 90 days for group health plans and health insurance carriers that offer group coverage.

California law (AB1083) currently sets the limit at 60 calendar days and effective dates cannot go beyond this time frame. This means that first of the month following 60 days (FOMF 60) is no longer an allowable waiting period in California. In Arizona and Oregon, first of the month following 60 days (FOMF 60) remains an available option.