Payroll Services

Question and Answer Memo

These are the rules prior to January 1, 2010

Please refer to the following HRS site for rules as of January 1, 2010:

http://hrs.wsu.edu/temporary%20employee%20benefits

 

Expanded Medical Insurance Question & Answer Memo of 9/10/99
from Barry Johnston

To: Deans, Chairs, Directors, Departmental Administrators
From: Barry E. Johnston, Director –Benefits & Payroll Services
Date: September 10, 1999
Subject: Expanded Medical Insurance Eligibility for Non-Student Temporary Employees

Follow-up to July 16, 1999 memo

On July 16, 1999 I mailed a memo indicating that beginning January 1, 1999, Non-Student Temporary Employees (NSTE) who work half-time or more for six consecutive months are required to be covered under the State medical insurance program at the start of the seventh month. We began placing NSTE in this fringe benefit on July 1, 1999, based on effort rendered from January through June. WSU did not receive an additional appropriation from the legislature for this increased expense. The Executive Committee has decided there will be no off-setting allocation from the benefits pool for state funded positions. The cost for the State medical insurance program is $391.15 per month, which includes basic life, dental, and health insurance.

Since the initial memo of July 16, 1999, many questions have been asked about the administration of the state medical insurance for Non-Student Temporary Employees (NSTE) who work half-time or more for six consecutive months and become eligible for medical insurance at the start of the seventh month. The following is a summary of the answers.

Q1… Who are Non-Student Temporary Employees (NSTE) and what expense records are being counted for the half-time criteria?

A1Non-Student Temporary Employees have job classifications starting with series 8000 and running through 8999. These NSTE are either not enrolled, or enrolled for fewer that six credit hours during the academic year (fewer than three credit hours during the summer), and are being paid an hourly or piece rate wage. All payroll expenses with job classification 8XXX are evaluated and counted to determine whether the sum is equal to, or greater than half-time each month.

Q2… What is defined as half-time?

A2… Half-time is determined by taking the number of Monday through Friday days in a month times eight hours times one-half.; e.g. August 1999( 22 X 8 X .5 = 88 hours).

Q3… Do overtime hours count when determining half-time?

A3… Yes. All hours paid on job classification(s) 8XXX count.

Q4… Can I avoid the benefit expense by paying the NSTE piece rate?

A4… No. For those few employees who are paid by the "piece", there is an hourly equivalent per piece calculation which determines that if it takes four hours to complete a piece, and the NSTE was paid for five pieces, then twenty hours are being accumulated for the monitoring.

Q5… When does medical insurance eligibility start?

A5… Medical eligibility occurs at the start of the seventh month, after having worked half-time or more for the preceding six months.

Q6… If the NSTE became eligible at the start of the seventh month, yet the appointment(s) end after six months, what happens?

A6… Even though the NSTE became eligible for medical insurance, since the NSTE had no active appointments at the start of the seventh month, they were not granted coverage.

Q7… If the NSTE appointment(s) continue beyond six months, and the NSTE work at least eight (8) hours a month, yet less than half time, does their medical insurance continue?

A7…Yes, the NSTE will retain their medical insurance as long as their appointment continues without a break in service.

Q8… What constitutes a break-in-service?

A8… A break in service is achieved when the NSTE no longer has any active appointments for a calendar month and the NSTE receives no pay from WSU for the entire calendar month.

Q9… What happens if the NSTE had medical insurance, yet a break-in-service occurs?

A9… Medical insurance will end at the end of the month preceding the calendar month in which the break-in-service occurred.

Q10… If the NSTE medical insurance ends, what then?

A10… The NSTE will have the opportunity to continue medical insurance coverage on a self-pay basis through COBRA rules. Contact Benefits (335-4589) for further information.

Q11… Can the NSTE medical insurance begin again after meeting a new qualifying period?

A11… Yes. If the NSTE medical insurance ended because of a break-in-service, and the NSTE then worked half-time or more, for six consecutive months, NSTE will once again be eligible for medical insurance at the start of the seventh month.

Q12… If I am a departmental administrator trying to prevent this medical insurance expense from happening, what can I do?

A12… Do not let a NSTE work half time or more for any consecutive six month period. Do not set up Temporary Appointments with indefinite end dates.

Q13… If I am a departmental administrator and terminate a NSTE appointment, yet they continue working for another department at half time or greater what will happen?

A13… If the NSTE works half time or more for six consecutive months they are eligible for insurance at the start of the seventh month. If you no longer employ the NSTE, you will not bear any of the benefit expense. The one or more other departments for which the temporary employee continues to work will share the medical insurance benefit expense in accordance with how the effort was rendered.

Q14… How can I monitor which NSTE might become eligible for medical insurance?

A14… Every NSTE who became eligible for medical insurance already became eligible for Department of Retirement Systems (DRS) retirement participation. DRS eligibility rules for retirement participation requires that you be employed for seventy (70) or more hours for five (5) or more months in a monitoring year (a monitoring year is a twelve month look back). Therefore, all HCA participants already became DRS retirement participants (unless the NSTE already has a student spouse waiver from DRS participation on file for the semester), however not all retirement DRS retirement participants will become HCA medical insurance participants.

Q15… Is there anything in HEPPS that alerts me to which NSTE are retirement participants?.

A15… Yes. In HEPPS inquiry, using "conversation QPREXP", you will see the 8XXX job classification and earnings types "HRP". The earnings type "HRP" indicates that the employee is both eligible for, and usually participating in DRS retirement system coverage. Benefits also sends a copy of the DRS PERS retirement enrollment letter as well as the HCA eligibility letter to the department when each event occurs.

Q16… Will the accounting sub-objects differentiate the benefit expenses that do not receive an off-setting allocation from the benefits pool?

A16… Yes. Sub-object HE for PERS I and HF for PERS II show the NSTE retirement expenses. Sub-object MD will show the medical insurance expense for NSTE. These sub-objects can be seen in either HEPPS (QYRPREXP) or Balances.

Q17… How will departmental account(s) be charged for the insurance expense?

A17… Like every other benefit expense, the insurance expense will be pro-rated in accordance with how the effort of the NSTE was rendered. If the NSTE works 20 hours for department "A", 10 hours for department "B", and 5 hours for department "C", the $391.15 expense will be split "A" $223.51, "B" $111.76, and "C" $55.88 respectively.

Q18… What if the benefit eligible NSTE is paid from an account which will not support benefit expenses? Can I override the benefit expense(s) to another account? How do I accomplish this?

A18… If the account does not allow any benefit expenses (no object 07), there is a way to override the expense to another account. The over-ride account must usually be in program "17". To have all the benefit expenses transferred to a program "17" account, submit the request in writing to Alice Smethurst (alice@wsu.edu). Be sure to include NSTE name & ssn, as well as the current and over-ride account.

Q19… When I interviewed and hired the temporary employee, I was assured he/she was an undergraduate student and enrolled full time. I appointed him/her as a temporary student employee. Now I find out that the undergraduate student enrolled for less than six credit hours, and they have been paid as a NSTE. What can I do about this?

A19… Since by definition, temporary employees are ‘casual laborers’ and serve at will, you can terminate their employment at will. Temporary undergraduate student employees who do not enroll for six or more hours are considered NSTE and are paid as such. Temporary graduate student employees are considered non-student when their enrollment falls below five credit hours. When enrollment drops below the minimum credit hours (6 credit hours for undergraduate, 5 for graduate), the students education is considered "incident to" their employment. They are paid as a NSTE that might become eligible for retirement and medical insurance participation. When the student’s education becomes incident to their employment by their enrolled hours falling below the minimum (6 credit hours for undergraduate, 5 for graduate), they immediately become eligible for Old Age Survivors Insurance (OASI) and Medicare, with contribution rates of 6.2% and 1.45% respectively. The employee and WSU each bear the 7.65% benefit expense for OASI and Medicare.

Q20… If a NSTE begins and ends an appointment in the middle of the calendar month--e.g. 05/16/99 and it ends on 11/15/99, is this six consecutive months counted because it is 6 months time OR is it NOT counted?

A20… Although the appointment begin and end dates may impact the available hours to work, what matters is the actual number of hours worked per month divided by the total number of work hours in the month, regardless of appointment begin and end dates.

Q21… If the NSTE became eligible, yet declined medical insurance coverage, what would happen?

A21… WSU is obligated to reimburse the Health Care Authority for medical insurance even when the employee declines and or waives coverage. Therefore your account(s) will still be charged as long as the NSTE works 8 hours a month and there is no break in service.

Q22… Who do I speak to if I have additional question?

A22… Payroll Services will keep an up-to-date list of Q&A’s on its WEB site. If you have a question that has not been answered on the WEB site, email your question to Alice Smethurst, at alice@wsu.edu. Once we answer your question, and determine that the Q&A is a University issue, it will be added to our Q&A WEB site.

 
 
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