Full-time to Variable Hour (Part-time)
When a full-time employee is moved to variable hour (part-time), or their hours drop to part-time level, they will typically no longer be eligible for health insurance. In this case, they should have the option to elect COBRA Coverage for a period of time.
In order to properly report this, you will need to provide details of the change, and to note whether the employee accepted or waived the COBRA coverage:
- Status Begin Date: This should reflect the employee’s first day as a variable hour employee.
- Job Status: In this scenario, the employee is moving from FT (full-time) to VH (variable hour). Note: Your company may use different codes. ACA TRACK will convert those to IRS standards based on a mapping you provide.
- Plan ID: This field should remain unchanged since the employee did not switch to a different medical plan when they reduced hours.
- Coverage Type: Be sure to specify whether the employee employee elected (COBRA Reduction in Hours) or waived (COBRA Waived) coverage.
- Coverage Type Dates: It is essential that the original Coverage End Date and the new Coverage Begin Date do not overlap. In most cases, the new Begin Date (line 2) will be day following the original End Date (line 1).
Variable Hour (Part-time) to Full-time
When a variable hour employee is moved to full-time, or their hours increase to full-time levels, they normally become eligible for health insurance benefits.
No Waiting Period
If employees are not subject to a waiting period when moving to full-time, you simply need to report the change. It will be very similar to the way we reported a move from FT to VH:
- Status Begin Date: This should reflect the employee’s first day as a full-time employee.
- Job Status: In this scenario, the employee is moving from VH (variable hour) to FT (full-time). Note: Your company may use different codes. ACA TRACK will convert those to IRS standards based on a mapping you provide.
- Plan ID: Because the employee was not eligible for coverage before, there is no Plan ID in the first line. Now that they are eligible, you need to enter the Plan ID for the lowest cost plan offered as a result of becoming eligible.
- Coverage Type: Enter “Insured” if they elected coverage, or “Waived” if they waived coverage. Note: Your company may use different codes. ACA TRACK will convert those to IRS standards based on a mapping you provide.
- Coverage Type Dates: Make sure your coverage dates do not overlap. In most cases, the new Begin Date (line 2) will be day following the original End Date (line 1).
Waiting Period
If the employee is subject to a waiting period, we need to insert an additional line in the coding for the time the employee was full-time but not yet eligible for health coverage:
- Status Begin Date: Line 2 should note the day the employee changed to full-time. Line 3 should use the same date, since there was no further change to the employee’s Job Status.
- Plan ID: Since the employee does not have coverage until the waiting period ends, you do not enter the Plan ID until the third line.
- Coverage Type: During the waiting period (line 2), the employee’s Coverage Type should be listed as LNAP (Limited Non-Assessment Period). Once the waiting period is over (line 3), enter “Insured” or “Waived”, depending on whether or not the employee accepted coverage.
- Coverage Type Dates: It is very important that these dates do not overlap and there is no gap in coverage. Notice above, each new Begin Date is the day following the previous End Date.
Next Step: Documenting a Division Change