Are employers legally required to provide health insurance

This page provides an overview of health care and medical insurance benefits for local government employees and elected officials in Washington State under the federal Affordable Care Act and state laws.

Overview

Many local government employers in Washington State are required to provide a minimum level of health insurance to their employees and the employees' dependents under the federal Affordable Care Act, but some smaller entities may be exempt from these requirements.

There are also special considerations under federal and state law for elected officials, part-time and seasonal employees, probationary employees, and other situations.

Affordable Care Act Requirements

Under the Affordable Care Act (ACA), large employers with 50 or more full-time employees are required to provide certain health insurance benefits, while smaller employers with less than 50 full-time employees are not required to provide health benefits.

Employers with 50 or More Employees

Large employers with 50 or more full-time employees, working 30 hours or more per week, are required to provide certain minimum health benefits coverage to their full-time employees and their dependents or pay a penalty to the Internal Revenue Service (IRS).

The Affordable Care Act provides various protections to those having or seeking insurance coverage. Some of these protections are:

• An insurance company cannot say “no” to a person seeking coverage. There are no lifetime limits (42 U.S.C. § 300gg-11).
• Coverage cannot be denied due to preexisting conditions (29 C.F.R. § 2590.715-2704).
• If an employee is covered by a health insurance plan, coverage should extend to their children until they are 26 years old. Coverage does not end exactly on their 26th birthday; it remains available until the end of the month in which the child turns 26 (26 C.F.R. § 54.9815-2714). 
• If an employee has a child under the age of 19, the employee’s health plan must provide “essential health care” to the child, including dental and vision services (42 U.S.C. § 18022(b)(1)(J)). (Note that the ACA does not require employers to provide separate dental or vision insurance to employees or their dependents, other than children under the age of 19.)

For more detailed information regarding the requirements of the Affordable Care Act, see the IRS FAQs on shared employer responsibilities under the Affordable Care Act.

Employers with Fewer Than 50 Full-Time Employees

Under the Affordable Care Act, employers with fewer than 50 full-time employees working 30 hours or more per week are not required to provide health insurance to any employees or dependents (26 U.S.C. § 4980H). However, they may still provide health insurance if they choose to do so.

Smaller employers may choose to provide a cash stipend to their employees instead of health insurance. The employees then can use the stipend to acquire medical insurance on their own or spend it for medical or other purposes. Providing a stipend would be permitted as it would be part of the employee’s compensation. Unlike the provision of insurance coverage, though, the stipend would be taxable (WAC 415-108-455).

Elected Officials

A local government may optionally provide health insurance for its elected officials and their dependents, but such coverage is not mandatory. State law authorizes any county, municipality, or other political subdivision, by action of its principal supervising official or governing body, to provide “hospitalization and medical aid” to their employees and dependents, including elected officials, if there are funds available for that purpose (RCW 41.04.180 and 41.04.190). 

By the state constitution the salary of local elected officials may not be increased after their election or during the officer’s term of office (Art. XI, section 8). Adding medical insurance coverage to elected officials after their election, one might think, would violate this constitutional prohibition, but it does not. RCW 41.04.190 provides that:

The cost of a [health insurance] policy or plan to a public agency or body is not additional compensation to the employees or elected officials covered thereby.

Most health benefits for elected officials are adopted informally by a motion but they can also be adopted by resolution. See the example below.

• Lynden Resolution No. 995 (2019) – Authorizes the mayor and councilmembers to enroll in a health insurance plan currently offered to qualified city employees

A stipend could also be given to an elected official instead of health insurance, but a stipend would be treated as extra compensation. Given the constitutional prohibition against additional compensation during a term of office, the stipend could not be given or accepted until the officer starts or is re-elected into a new term. While the provision of medical insurance to an elected official is not considered by statute to be additional compensation (RCW 41.04.190), there is no similar provision made for stipends.

See the policy example below:

• Vancouver Health Insurance Opt-Out Payment Policy (2018) – Allows councilmembers to receive payment in lieu of city health insurance; addresses the prohibition on mid-term adjustment of compensation of elected officials

Part-Time and Temporary/Seasonal Employees

Employers should take every measure to ensure that their employees are correctly classified as part-time or seasonal employees. Under state law, employers are prohibited from intentionally misclassifying employees, or "taking other action to avoid providing or continuing to provide employment-based benefits to which employees are entitled under state law or employer policies or collective bargaining agreements applicable to the employee's correct classification" (RCW 49.44.160 - .170).

To determine if an employee has full-time status, in regards to the ACA employer shared responsibility provisions, see the IRS page on Identifying Full-Time Employees.

Part-Time Employees

Under the ACA, large employers (50 or more employees) are required to provide health insurance to employees who work 30 or more hours per week. If a part-time employee works fewer than 30 hour per week, the employer is not required to provide insurance (26 U.S.C. § 4980H).

Seasonal Employees

Temporary employees typically work for six months or less, some on a seasonal basis during the same time of the year – such as election workers during election season or certain parks or public works employees who might only work during the summer months.

If the employer has fewer than 50 full-time employees, the employer is not required to provide coverage. However, if the employer has more than 50 full-time employees, the employer is required to provide health benefits to seasonal employees, if they were to work on the average 30 or more hours a week or 130 hours a month for four or more months (29 C.F.R. § 500.20(s)(1) and 26 U.S.C. § 4980H).

Probationary Employees

Employers may set a waiting period for probationary employees, not to exceed 90 days, before a new employee becomes eligible for health insurance. The 90-day waiting period applies to all group health plans provided by an employer, not just those required as result of the Affordable Care Act.

Depending upon the length of the probationary period set by the employer, a newly hired employee may qualify for health insurance during the probationary period. If the probationary period is, for example, six months, the employee would qualify for health insurance after 90 days (or earlier, if the employer’s policy provided for a shorter waiting period).

For more information on the 90-day waiting period under federal law, see the Federal Register rules regarding the Ninety-Day Waiting Period Limitation. 

Same-Sex Spouses and Domestic Partners

Same-sex spouses are entitled to the same benefits as opposite-sex spouses (RCW 26.04.010(1)).

State-registered domestic partnerships must be granted the same rights to benefits as those granted to married couples (RCW 26.60.015). However, the decision to cover unregistered domestic partners as dependents is a policy choice for each individual jurisdiction.

Disclosure of Health Insurance Application Information

There is not a categorical exemption for health insurance applications under the state Public Records Act (PRA). Nevertheless, much of the information set out on an application form would be exempt from disclosure.

Below are examples of these exemptions:

• Information regarding an employee's address and telephone number is exempt (RCW 42.56.250(4)
• An employee’s social security number is exempt (RCW 42.56.250(4))
• If the application form requires information on an employee’s health conditions, some of that information may be exempt (RCW 42.56.230(3)). The statute allows redaction of information that would violate an employee's right to privacy. Not every condition would fall into this category, though; to be exempt, the information must be "highly offensive to a reasonable person" and "not a legitimate concern to the public" per RCW 42.56.050. One court concluded that certain disabilities, such as back injuries, asthma, emphysema, ulcers, and possible arterial problems were not "highly offensive" and were a “legitimate concern to the public.” See Seattle Firefighters Union v. Hollister (1987). The Hollister decision, however, dealt with records involving disability retirement benefits and the court concluded that the public did have a legitimate concern about the administration of a disability retirement program. That conclusion might not be found true where employees are seeking health insurance for themselves and family members.

Does my employer have to offer health insurance in Massachusetts?

Are employers required to provide health insurance in Washington state?

Do employers have to offer health insurance in Florida?

Do I have to offer health insurance to all employees California?