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) Look Back Period (12 month) (Provide Benefits) Equal Length Stability Period Declare employee part time at hire Track time during look back Determine status in look back period Auto-enroll in benefits if 30+ hours Continue benefits while employed EVEN IF HOURS DECREASE Part Time Eligibility Cover New Hire Begins thru July July July 2014 2015 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) 5
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 Penn ACA equivalency hours @ 3.3 hours per hour of weekly instruction ACA Benefits Eligible or Ineligible 1 3.3 Ineligible 2 6.6 Ineligible 3 9.9 Ineligible 4 13.2 Ineligible 5 16.5 Ineligible 6 19.8 Ineligible 7 23.1 Ineligible 8 26.4 Ineligible 9 29.7 Ineligible 10 33 ACA Benefits Eligible 11 36.3 ACA Benefits Eligible 12 39.6 ACA Benefits Eligible 6
Affordable Care Act Equivalency Matrices Table 3 CU s per semester Stipulated typical hours weekly instruction per CU Penn ACA equivalency hours@ 3.3 hours per hour of weekly instruction ACA Benefits Eligible or Ineligible.5 2 6.6 Ineligible 1 4 13.2 Ineligible 1.5 6 19.8 Ineligible 2 8 26.4 Ineligible 2.5 10 33 ACA Benefits Eligible 3 12 39.6 ACA Benefits Eligible 7
Affordable Care Act Equivalency Matrices Table 4 Per diem Days Per diem Hours ACA Benefits Eligible /30 hours or more Penn ACA equivalency hours of weekly instruction 5.00 40 ACA Benefits Eligible 4.25 38 ACA Benefits Eligible 4.50 36 ACA Benefits Eligible 4.25 34 ACA Benefits Eligible 4.00 32 ACA Benefits Eligible 3.75 30 ACA Benefits Eligible 3.50 28 Ineligible 3.25 26 Ineligible 3.00 24 Ineligible 2.75 22 Ineligible 2.50 20 Ineligible 2.25 18 Ineligible 2.00 16 Ineligible 1.75 14 Ineligible 1.50 12 Ineligible 1.25 10 Ineligible 1.00 8 Ineligible 0.75 6 Ineligible 0.50 4 Ineligible 0.25 2 Ineligible 8
Part Time Faculty Focus on HOURS in PennWorks FIX PENNWORKS REMEMBER 0 Hours + $$ >30 hours = Full Time Equivalence Enter hours using ACA Equivalency Matrix ACA eligible for medical coverage Roles are additive Full E.B. rate Lock roles to enable discussion 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
Benefits Design under ACA Work in Progress 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 13