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Proposed Legislation to Amend the ACA’s 30-Hour Rule

The US House of Representatives is planning to vote on legislation that would change the definition of a full-time worker under the Affordable Care Act (ACA), raising it to 40 hours a week, up from the law’s current standard of 30 hours, among other changes to the law. The bill (H.R. 3798) is named the Save American Workers Act and includes provisions to address and modify various aspects of the ACA. According to press accounts, the bill has 77 sponsors, including 72 Republicans and 5 Democrats.

Under the current law, businesses with 50 or more employees working an average of at least 30 hours a week must offer health coverage or face fines. Businesses have objected to the 30-hour threshold saying it is too low given that 40 hours is the standard for a full week under federal overtime laws. The US Congressional Budget Office reported that the change from 30 to 40 would reduce federal revenue by $9.8 billion from 2019 to 2028. The proposed legislation grants retroactive relief from the employer mandate. Thus, any employer that owed a penalty for failing to provide coverage from January 1, 2015 to December 31, 2018 would no longer owe it. The legislation also would delay implementation of the so-called “Cadillac Tax” on high-premium health insurance plans until 2023. Overall, according to press accounts, the legislation would reduce federal revenue by $51.6 billion.

The House is expected to vote on the bill after the November midterm elections. In order to pass, the bill must first be approved by the US House and the US Senate before being approved by the President. As expected, business groups have spoken in support of the bill. We are following ACA proposed changes closely and will provide updates as applicable.

Please contact your Conner Strong & Buckelew account representative toll free at 1-877-861-3220 with any questions. For a complete list of Legislative Updates issued by Conner Strong & Buckelew, visit our online Resource Center.

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