01 Apr The Look-back Measurement Method and COVID-19 – ACA Compliance
The Affordable Care Act (ACA) requires applicable large employers (ALEs) to offer affordable, minimum value health coverage to their full-time employees or possibly pay a penalty. This employer mandate is also known as the “employer shared responsibility” or “pay or play” rules.
ALEs can use one of two methods to determine whether employees are full time under the employer shared responsibility rules:
- The monthly measurement method determines full-time status
for each calendar month based on the employee’s hours of service
in that month.
- The look-back measurement method determines full-time status
for a longer period of time based on average hours of service
during a prior period.
The evolving coronavirus (COVID-19) pandemic has caused some confusion and uncertainty in applying the look-back measurement method during periods of layoff, furlough, and COVID-19 related periods
of paid and unpaid leave.
This ACA Compliance Bulletin provides information for employers regarding how the look-back measurement method applies to COVID-19 related absences.