Probationary Period Update – CA SB1034

California’s Limit on Waiting Periods (Probationary Periods)

As we communicated to you a few weeks ago, Governor Brown signed CA SB1034 into law on Friday, August 15, 2014. CA SB1034 repeals California’s stricter 60-day limit on waiting periods (in accordance with AB1083) and allows employers to follow the federal ACA’s 90-day waiting period limitation. CA SB1034 also prohibits insurers and health plans from imposing waiting periods, although the insurer or health plan may administer waiting period on behalf of the employer (as long as the employer’s waiting period does not exceed the ACA’s 90-day limit).

 

Effective September 1, 2014, Health Net is reinstating the First Of The Month Following (FOMF) 60 days as an option. This change is not retroactive and applies to all new and renewing commercial groups as follows:

  • Groups that wish to make an off-cycle change to their probationary period must contact their Account Manager/Consultant.
  • If a group requests a different probationary period, it will be on a go forward basis.
    • For example – A new hire starting with the employer group on 8/15 and that group has a FOMF 30 days and the group elects to change to FOMF 60 days effective 9/1. New hires that start on 8/15 will fall under the prior probationary period of FOMF 30 days. Any new hires after the probationary period change on 9/1 will have a FOMF 60 days.

We appreciate your partnership in the continued growth of your business and for making us your carrier of choice and thank you for guiding our members to better informed health care decisions. For more information on this or other ACA-related topics, log onto www.healthnet.com/broker/reformguide or contact your Health Net Representative or Broker Services at (800) 448-4411, option 4.

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Susan Peters