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Affordable Care Act

In 2010, the Affordable Care Act (ACA) was signed into law, introducing significant reforms to health care policy. Among other things, the ACA made it easier for many people to get coverage, removed annual and lifetime limits on essential health benefits and put in place requirements that individuals have medical coverage or pay a tax penalty. Many aspects of the ACA did not affect UC employees, but UC did make some changes to eligibility rules to increase access to qualifying coverage. As long as employees stay in a UC-sponsored medical plan, they meet the minimum requirements for affordable coverage.

What the ACA means for you

New pay categories make it easier to maintain benefits eligibility

UC’s benefits eligibility rules have always required that employees work a certain minimum number of hours to keep their benefits. All “paid time” that you earn now counts toward your benefits eligibility, along with certain types of unpaid time such as time protected by the Family Medical Leave Act (FMLA) or the Uniformed Services Employment and Reemployment Rights Act (USERRA). Specifically, UC now counts the full range of paid time hours including sick time, vacation, holidays, paid leave of absence, paid jury duty and paid military duty. Special unpaid time that will also be counted includes unpaid FMLA leave, unpaid USERRA leave, unpaid jury duty and unpaid hours during “special employment breaks” of at least four weeks.

New method for measuring continuing benefits eligibility

Since the ACA went into effect, UC measures your average hours of service once a year, in November, over a 12-month “look-back” period, rather than checking this measurement each month. In other words, once you become eligible for medical benefits coverage, you remain eligible for at least 12 months. “Average Weekly Hours of Service” is the measurement used to calculate your ongoing benefits eligibility. Most employees will remain eligible for benefits coverage if they work an average of 17.5 hours per week during the look-back period.

New types of employees now eligible for UC benefits

While UC has long offered coverage to many employees — both full-time and part-time — UC extended eligibility to the following job classifications (as long as the appointment involves working 75 percent time, or 30 hours a week, for three months or more):

  • Students in “casual/restricted” appointments
  • Per diem employees
  • Employees paid “by agreement” (flat-dollar compensation)
  • Seasonal workers

New IRS form required to confirm health coverage

Every year, you will receive Form 1095, which you’ll use to confirm your health coverage when you file your  annual federal income taxes. Individuals who submit this information on their income tax returns will satisfy the “individual mandate” to maintain health insurance coverage for the year. Depending on the type of coverage you have, you may receive this form from your medical plan, from UC or from both; UC retirees in Medicare will receive the form from Medicare.

Form 1095 confirms your and your dependents’ coverage for each month of the year. You do not need to submit Form 1095 with your income tax return, but you should keep a copy of the form with your important tax documents in the event you need to prove to the IRS that you satisfied the ACA’s “individual mandate” to maintain health insurance coverage for the year.

Similar to other tax forms, Form 1095 will identify you and your dependents by your Social Security numbers (SSNs) so that the IRS can accurately identify covered individuals. As a result, you may be asked to supply UC or your health insurance carrier with any missing SSNs for yourself and/or your covered dependents.

Learn more about Form 1095 »
IRS FAQ about Form 1095 »

What the ACA means to UC

While the ACA improves the health care system, the law also imposes many new requirements on employers. Health care reform affects UC in two main ways.

  1. UC’s plans are more heavily regulated. Health care reform put in place many new rules. Some are one-time changes, but others require annual monitoring and administrative duties.
  2. The health care landscape will keep changing. With health care reform, new companies and new ways of providing medical care emerged to help improve the health care system and help you interact with it in a better way. These shifts brought new opportunities for UC — especially in our role as one of the largest health care providers in California.

Health Insurance Marketplace — “Exchanges”

In California, the Health Insurance Marketplace is called Covered California. Marketplaces are intended for people who can’t get affordable coverage through their employer and also for small businesses. Anyone can shop in the marketplace, but since benefits-eligible employees have affordable coverage through UC, they are not eligible for the premium tax credits available through the marketplace.

What you can do to help keep costs down

As you learn and think about what the law means to you and your family, your everyday actions matter.

  • Make good choices during UC’s Open Enrollment this year.
  • Take care of yourself and make sure you and your family members get appropriate preventive care, which is now available at no cost to you.
  • Develop a strong relationship with your doctor. He or she has your best interests at heart.
  • Keep learning. Stay curious about ways to better interact with the health care system. When consumers are better informed, change happens. Explore ways to get the most from your benefits.
  • Understand your benefits. Learn more about UC’s benefits.