Health insurance is one of the hardest things to coordinate when starting a new job with a new employer, but it’s also something that can’t be rushed. Finding a health care provider who puts a patient’s health and well-being first is important so that you get the right care and treatment when you need it. Taking the time to understand when your health insurance kicks in at a new job can also help remove some of the stress associated with such a major life event.
This page provides an overview of the various aspects of employer health insurance and explains common terms so you can ensure you are adequately covered during each step of your career transition.
search this article:
- Does my employer have to provide health insurance?
- what are the waiting rules for workplace insurance?
- types of health insurance plans on the market
- What if my new employer doesn’t offer insurance?
- The Consolidated Omnibus Budget Reconciliation Act (COBRA) may allow you to continue purchasing health insurance from your former employer’s plan, even if you are not technically employed by that organization. For more information on cobra, visit us. uu. labor department.
- Several short-term health insurance companies exist to fill the gap between employers. These short-term plans are very convenient, as they often take effect the day after you sign up, and you can usually cancel on a month-to-month basis. However, they lack some of the benefits associated with ICA-approved health plans, such as coverage for pre-existing conditions, making them inefficient for long-term use. To learn more about short-term care providers and how they compare to Cobra, visit Investopedia.
Does my employer have to provide health insurance?
Due to the employer mandate under the Affordable Care Act (ACA), employers with 50 or more full-time employees or full-time equivalent employees (FTES) must provide health insurance to at least 95% of people who work full time. This health insurance coverage must meet the criteria of minimum value and affordability.
Employers are also required to provide health insurance for the children of those full-time employees. in this case, “children” are considered to be those under 26 years of age, excluding stepchildren and foster children. spouses are not considered dependents.
In some cases, the employer pays part of the monthly premium and the employee pays the rest. other times, the employer will pay the full monthly premium as an additional benefit to the employee. Sometimes the employer will go further and offer additional insurance benefits, such as vision plans, dental plans, and workplace wellness programs, but the law only technically requires the minimum outlined in the ACA.
If an employer fails to provide health insurance that meets minimum value and affordability criteria, the employer is subject to penalties.
Employers with fewer than 50 employees are not required to provide health insurance to their employees.
what are the waiting rules for workplace insurance?
Many employers will offer health insurance plans to new hires on their first day, especially full-time employees. however, employers are free to decide when health benefits are activated for new hires. Some may choose to have a waiting period for new hires, but there are limitations on how long an employer can wait. The ACA dictates that employers must wait no more than 90 days before offering health insurance. these 90 days include weekends and holidays.
Once you’re eligible, employers will often offer you a variety of health plans to choose from and give you a period of time, called a special enrollment period, to make your decision. If you don’t make a decision about a health plan within the special enrollment period, you’ll usually have to wait until the annual enrollment period.
Because the details of the waiting rules may be different for each employer, it’s a good idea to contact your new employer’s human resources department to make sure you fully understand the rules.
types of market health insurance plans
Plans are often categorized into four tiers: bronze, silver, gold, and platinum, with bronze offering the fewest covered services and platinum offering the most. Generally, the more covered services a plan has, the more it costs.
Regardless of the coverage level of services offered, Marketplace plans often fall into a few unique categories. Depending on the category you choose, you may have restrictions on where you can go for health care services and how much you’ll end up paying out of pocket.
health maintenance organization (hmo)
With a health maintenance organization, or hmo, you are covered if you choose from the approved list of local doctors, specialists and hospitals. however, with an hmo, you are generally not allowed to go directly to any health care provider of your choice. Generally, you must first choose a Primary Care Physician (PCP). if you get sick, you should see your pcp first. Your PCP will then refer you to an approved specialist within the HMO network if necessary.
If you decide to use a health care provider who is not in the approved network, or if you decide to see a specialist health care provider before seeing your PCP, you will generally have to pay out of pocket.
exclusive supplier organization (epo)
an exclusive provider organization, or epo, is similar to an hmo with one key difference: you generally don’t need to see a primary care physician (pcp) before seeing a specialist. Therefore, an EPO is a group health insurance option that can offer greater flexibility and potentially expedited care. Just like an HMO, an EPO generally won’t cover anything outside of the approved network of doctors, specialists, and hospitals.
preferred provider organization (ppo)
Just like hmos and epos, a preferred provider organization, or ppo, will provide you with a list of doctors, specialists, and hospitals to choose from. however, in the case of a ppo, choosing from this list is not a strict requirement. A PPO will generally pay at least some of the costs associated with health care providers outside the approved network, while HMOS and EPOS will not.
If you choose a ppo and choose to go out-of-network, you may be required to pay the full cost of treatment, up to a certain deductible, before copays are applied to help with costs. this type of arrangement is called “coinsurance.”
healthreimbursement agreement (hra)
A health reimbursement arrangement, or HRA, is when employers reimburse employees for qualified medical expenses up to a certain dollar amount each year. often unused reimbursement funds roll over to the next year.
health savings account (hsa)
A health savings account, or HSA, is a special type of individual health insurance bank account that can be used only to pay deductibles associated with medical expenses (but not premiums). These accounts differ from regular bank accounts in that they are funded on a pre-tax basis. Instead of paying taxes, receiving funds, and then using those taxed funds to pay medical deductibles, you can receive money directly into your HSA and use it to pay medical deductibles without first paying tax expenses.
What if my new employer doesn’t offer insurance?
If you quit or are laid off from a job that provides health insurance and have a qualifying life event, you may have access to a special open enrollment period during which you can purchase your own health insurance plan (without any help from a new employer). To learn more about your options and check your eligibility, visit healthcare.gov.
Several options are available if your new employer does not offer any type of insurance, for example, if your employer has fewer than 50 full-time or full-time equivalent employees, or if you work part-time for your new employer :
Health insurance is a complex and important topic to understand. At a time when healthcare services are needed, the last thing you want is a battle with an uncooperative company. Finding a health insurance provider that puts the patient first and makes the process simple will help you get the best possible care while reducing the amount of stress you experience.
Before you select a particular plan from your employer, make sure you understand all of your deductibles, premiums, and out-of-pocket costs associated with the plan. Also, make sure you know when your health insurance will take effect. Finally, ask about Medicaid, sick days, the reimbursement program, and the availability of life insurance regarding how these factors might affect your health care coverage. Your new employer’s human resources department should be able to answer all of these questions to help you get the coverage that’s right for you.