One thing interns might not consider is if they are eligible to receive healthcare coverage from their employer when interning for the company. In the past, this has not even been a consideration but with the Affordable Care Act (ACA), employers with over 50 or more employees working 30 hours or more per week must comply by the stipulations set forth by the ACA. This includes “full-time equivalent” employees which is set forth by dividing the number of full-time employees plus the combined number of part-time employee hours by 30.
Employer Shared Responsibility
If an employer has more than 50 FTE employees, it must provide health insurance for its full-time staff members, or they will be forced to pay a per-month “Employer Shared Responsibility Payment”, which is quite hefty. This is a penalty assessed to employers that fail to comply with the ACA. For an individual to be considered full-time under the ACA, he or she must average more than 30 hours per week for a minimum of 120 days. The 120 days do not have to be consecutive, but must occur during a 360-day period.
At its heart, the Affordable Care Act (ACA) is a set of health insurance reforms intended to make healthcare more accessible to all Americans. The consequence of such accessibility to employees has caused an increase in responsibilities for employers. Not all employers, however, are impacted by the ACA’s requirements and not all interns are required to be covered.
Fair Labor Standards Act
In order for a company to be required to pay for healthcare coverage, it must be for full-time employees. Independent contractors or unpaid interns are not considered, under the Fair Labor Standards Act, to be full-time employees. However, if an internship is paid, there may be additional exclusions available. For example, “Seasonal employees” (those hired to work for a position that is customarily six months or less at approximately the same time each year), may also be excluded from the ACA. If your internship is unpaid, you may want to check the Department of Labor’s Guidelines for unpaid internships to ensure that your internship meets the six prong test for unpaid internships or learn more about the most recent ruling of the 2nd Circuit Court which uses different criteria when judging if an internship may be unpaid.
In addition, according to the ACA parents are allowed to keep their children on their health care insurance until the age of 26. Students covered by their parents’ insurance do not need to receive coverage through their employer. On the other hand, if the parents’ healthcare is through a health maintenance organization (HMO), the student may not meet certain stipulations; such as, the need to receive care through an in-network provider which could pose a problem if the student is working in another state. A student that gets an internship in another state may not be able to receive care unless they return home, which can be a real inconvenience for the student.
For students completing a paid internship and averaging over 30 hours per week over the course of 120 days (does not need to be consecutive but must occur within a 360 day period), the employer may very well be required to pay for healthcare benefits for the intern. If you are a paid intern working for the summer and you meet all of the above stipulations, it’s important for you to check on your right to receive healthcare benefits from your employer.