Update on the Affordable Care Act
Association of Business Administrators
September 24, 2014
1
Planning Assumptions
Collaborative effort with Provost Office and School Working Group
• Affordable Care Act does NOT directly impact full time Faculty, FT
Staff or College Work Study students.
• ACA may impact the benefits eligibility of part time academic support
faculty, part time administrative staff, temporary employees and
graduate students no longer receiving fully funded packages.
Penn intends to meet the requirements of the law.
• Offer medical coverage to part time academic support staff,
administrative staff and temporary workers who achieve full time
equivalency. (An average of 30 hours per week)
• Charge the full time employee benefit rate to part time faculty, staff
and temporary workers who achieve full time equivalency, regardless
of their enrollment choice.
2
Full Time Equivalency For ACA From Penn Perspective
For all current faculty and staff and future hires, Penn must determine the
expectation of working 30+ hours per week which equates to full time status under
the Affordable Care Act.
This determination can be based on monthly measurement or look-back methods
Actual hours worked for non-exempt staff based on payroll records
Course standard for faculty who teach
(3 courses Fall + 3 courses Spring = Full time equivalent)
Exception time reporting for part time monthly paid staff
Look back (eligibility determination) period
Penn is a research institution that operates all year
A course equivalency matrix to translate courses to hours
3
Look Back (determine eligibility) and
Stability (provide coverage) Periods
(Determine Eligibility if unclear at hire)
(Provide Benefits)
Look Back Period (12 month)
Equal Length Stability Period
Declare employee part time at hire
Track time during look back
Part Time
New Hire
July
2014
Determine status in look back period
Auto-enroll in benefits if 30+ hours
Continue benefits while employed
EVEN IF HOURS DECREASE
Eligibility
Begins
July
2015
Cover
thru
July
2016
Note: New hires will have their own personal look back period until
they synch up with the University look back period
4
Recommendations to the Schools for Part Time Faculty
• Institutionalize use of template letters of appointment for part time faculty to
include expected work hours for a CU assignment.
• Offer letter template for part time faculty is available at:
http://provost.upenn.edu/uploads/media_items/pt-lecturer-sample-offer-letter.original.docx
• Create a new payment schedule for <30 hours/week part time faculty
(don’t pay a total of $1,200 at a rate of $100 per month)
• Review Hours field in PennWorks (see ACA Equivalency Matrix)
Particular attention to 0 hours and receiving pay
>30 hours may be considered eligible for medical coverage at full E.B. rate
Roles are additive – may want to lock roles to have discussion
For part time Clinician Educators, enter hours worked in a week, up to 60
• Implement “Auto-termination” for part time faculty who have not been paid in 4
months and do not have an active appointment.
(If there is a reasonable expectation that the part time faculty member will teach
the following Fall/Spring semester, the role end date can be updated in
PennWorks and the individual will not be auto-terminated)
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Affordable Care Act Equivalency Matrices
Table 1
Course load
ACA Benefits
Eligible or Ineligible
3 courses fall and 3 courses spring ACA Benefits Eligible
2 courses fall and 2 courses spring Ineligible
1 course fall and 1 course spring
Ineligible
Table 2
Hours or estimated
hours of weekly
instruction
1
2
3
4
5
6
7
8
9
10
11
12
Penn ACA equivalency
hours @ 3.3 hours per
hour of weekly
instruction
3.3
6.6
9.9
13.2
16.5
19.8
23.1
26.4
29.7
33
36.3
39.6
ACA Benefits
Eligible or Ineligible
Ineligible
Ineligible
Ineligible
Ineligible
Ineligible
Ineligible
Ineligible
Ineligible
Ineligible
ACA Benefits Eligible
ACA Benefits Eligible
ACA Benefits Eligible
6
Affordable Care Act Equivalency Matrices
Table 3
CU’s per
semester
Stipulated typical hours
weekly instruction per CU
.5
1
1.5
2
2.5
3
2
4
6
8
10
12
Penn ACA equivalency hours@ 3.3
hours per hour of weekly
instruction
6.6
13.2
19.8
26.4
33
39.6
ACA Benefits
Eligible or Ineligible
Ineligible
Ineligible
Ineligible
Ineligible
ACA Benefits Eligible
ACA Benefits Eligible
7
Affordable Care Act Equivalency Matrices
Table 4
Per diem
Days
Per diem Hours
5.00
4.25
4.50
4.25
4.00
3.75
3.50
3.25
3.00
2.75
2.50
2.25
2.00
1.75
1.50
1.25
1.00
0.75
0.50
0.25
40
38
36
34
32
30
28
26
24
22
20
18
16
14
12
10
8
6
4
2
ACA Benefits Eligible
/30 hours or more Penn ACA
equivalency hours of weekly
instruction
ACA Benefits Eligible
ACA Benefits Eligible
ACA Benefits Eligible
ACA Benefits Eligible
ACA Benefits Eligible
ACA Benefits Eligible
Ineligible
Ineligible
Ineligible
Ineligible
Ineligible
Ineligible
Ineligible
Ineligible
Ineligible
Ineligible
Ineligible
Ineligible
Ineligible
Ineligible
8
Part Time Faculty – Focus on HOURS in PennWorks
FIX PENNWORKS
REMEMBER
0 Hours + $$
>30 hours = Full Time Equivalence
ACA eligible for medical coverage
Roles are additive
Full E.B. rate
Lock roles to enable discussion
Enter hours using
ACA Equivalency
Matrix
9
Recommendations for Staff Positions
• Any Temp who works an average of 30+ hours in any 90 day period must be
offered medical coverage full time employee benefit rate will be charged to
department
• Penn will NOT limit temporary workers hours or role duration
• Penn will continue to monitor Temps who work > 1,000 hours in a fiscal year.
Departments will be charged at the full time employee benefit rate
• Department of Labor – Do NOT flip flop temps to/from Unique Advantage
• Expand use of Pilot Position Information Questionnaire for Temps
• Alternative : Expand use of third party agency for temporary staff
10
Work in Progress
Benefits Design under ACA
•
Medical Coverage only
- Must be affordable
- Must provide essential minimum benefits
Ambulatory patient services; Emergency services, Hospitalization;
Maternity and newborn care; Mental health and substance use
disorder services; Prescription drugs; Laboratory services;
Rehabilitative and habilitative services and devices;
Preventive and wellness services and chronic disease management
Pediatric services
• No change at this time to current offering for PT employees where the colleague
has access to medical plans but pays 100% of the cost.
11
Future Efforts
Auto-enrollment
Establish an administrative period to review eligibility determination
Process if employee does not respond during enrollment period
Rolling enrollments as new part time hires achieve eligibility.
Reporting
ACA requires dual reporting
Internal Revenue Service
Employee (must include dependent information)
Evaluating vendor capability to support reporting requirement.
12
Sample of ACA Reports – Form 1095-C
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