Roughly one in three private-sector workers starts a new job with a waiting period of 30 days or more before employer health coverage kicks in. The 90-day statutory maximum under PHSA Section 2708 means a segment of new hires hits a gap of two to three months with no group coverage. That window is an SEP opportunity for Marketplace enrollment, and for households with income between 100 and 400 percent of FPL, APTC can make a short-term Marketplace plan affordable enough to be worth the enrollment.
Key Takeaways
- The ACA caps employer waiting periods at 90 calendar days under PHSA Section 2708
- New hires who lose prior coverage can qualify for a Marketplace SEP and APTC during the gap
- APTC during the waiting period requires that expected employer coverage be unaffordable, or that no offer is yet in hand
- The SEP window is 60 days from loss of prior coverage, so timing the enrollment matters
- A 90-day waiting period typically means 2 to 3 months of Marketplace premiums before employer coverage kicks in
The statutory waiting period cap
PHSA Section 2708 prohibits ACA-compliant group plans from requiring employees to wait more than 90 calendar days before coverage becomes effective. The rule applies to plans subject to the ACA's market reform provisions, which covers most employer-sponsored group health plans. Some employers use shorter waiting periods: 30 days is common in professional services, and some tech employers start coverage on the first day.
The 90-day cap is a ceiling on what employers can impose, not a recommended standard. A broker working with small business owner clients can influence the waiting period design during benefits planning. A shorter waiting period reduces the gap and the associated COBRA or Marketplace bridge enrollment complexity.
The SEP window for new hires
A new hire who held coverage under a prior employer plan and lost it when leaving qualifies for a loss-of-coverage Special Enrollment Period on the Marketplace. The SEP window is 60 days from the date coverage ended. That date is typically the last day of the month in which the prior job ended, depending on the previous employer's plan terms.
The 60-day window is not aligned with the 90-day waiting period. If a client's prior coverage ended on July 31 and the new employer's plan does not start until November 1, the SEP window closes on September 29. The client cannot wait to see how the waiting period plays out and then enroll in October. The enrollment decision needs to happen within 60 days of the coverage loss.
Waiting period scenarios and bridge plan logic
| Situation | Gap length | Bridge plan calculus | Notes |
|---|---|---|---|
| 30-day waiting period | 1 month | Rarely worth the enrollment friction | Most clients self-insure for one month |
| 60-day waiting period | 2 months | Worth quoting if APTC brings premium under $150/month | SEP window closes at day 60 from loss of prior coverage |
| 90-day waiting period (statutory max) | 3 months | Strong case for Marketplace bridge | 3 months of uninsured exposure is significant |
| No prior coverage (new employee) | Varies | Depends on available SEP trigger | Loss-of-coverage SEP not available; check other triggers |
Illustrative scenarios. Actual APTC eligibility and premium amounts depend on household income, rating area, and CMS plan year data.
APTC eligibility during the gap
APTC during the waiting period is available when the client meets the standard Marketplace eligibility requirements: household income between 100 and 400 percent of FPL (or eligible under expanded APTC rules through 2025 extension provisions), not incarcerated, lawfully present, and not enrolled in Medicare or Medicaid.
The complication is the employer coverage test. If the employer has already extended a formal offer of coverage and that coverage is affordable, the client may be ineligible for APTC even before the plan starts. In practice, many employers do not issue a formal offer letter until the waiting period ends or shortly before coverage starts. The timing of the offer matters. Brokers should ask the client specifically whether a written offer of coverage has been received, not just whether they know they will eventually have coverage.
Reconciliation when employer coverage starts
Clients on a Marketplace bridge plan need to terminate that coverage when the employer plan starts. The termination date should match the employer plan effective date. APTC paid for any period after the employer plan became available and the employee enrolled must be reconciled on Form 8962.
The reconciliation exposure is low if the bridge plan ends on time and employer coverage was not affordable during the gap months. It increases if the client forgot to report the employer coverage start date to Healthcare.gov and continued receiving APTC past the employer plan effective date.
Build the coverage end date into the new hire workflow as a follow-up task, not an afterthought. A calendar reminder for the employer plan effective date and a Healthcare.gov update at that time prevents most reconciliation problems.
New hire intake checklist for waiting period gaps
For clients starting a new job, collect these before quoting:
- Last date of prior coverage and the prior plan type
- New employer's waiting period length (ask for the exact days, not "about 90 days")
- Whether a written offer of employer coverage has been received
- The employer's family tier premium (for the family glitch analysis)
- Household MAGI estimate for the current plan year
With those five inputs, you can determine SEP eligibility, run the APTC estimate, and advise on whether a bridge plan makes financial sense before the 60-day window closes.
ACA waiting period and Marketplace coverage questions
What brokers ask about managing the coverage gap for new hires.
What is the ACA employer waiting period rule?
Section 2708 of the Public Health Service Act, incorporated into the ACA, prohibits group health plans from imposing a waiting period longer than 90 calendar days before a new employee's coverage becomes effective. This applies to ACA-compliant group plans from employers subject to the employer mandate (generally 50 or more full-time equivalent employees). Some smaller employers follow similar practices voluntarily. The 90-day limit is a maximum, not a standard: many employers use 30 or 60-day waiting periods, and some have no waiting period at all.
Can a new hire enroll in a Marketplace plan during the waiting period?
Yes. A new hire who loses prior coverage when changing jobs qualifies for a loss-of-coverage Special Enrollment Period. This SEP allows the individual to enroll in a Marketplace plan outside of OEP. The 60-day SEP window runs from the date of loss of prior coverage, not the first day at the new job. If the client held no prior coverage, no loss-of-coverage SEP exists, but they may qualify under other SEP triggers such as a change in household income. APTC is available during the gap if the client meets income requirements and does not yet have an in-force employer plan.
Does APTC stop when employer coverage starts?
APTC through the Marketplace stops when the client enrolls in employer coverage. Clients should report the employer coverage start date to Healthcare.gov promptly to avoid APTC reconciliation issues on Form 8962 at tax time. If the employer coverage turns out to be affordable (employee-only premium under 9.02 percent of MAGI in 2026), the APTC received during the waiting period must be reconciled against any advance payments made after the employer plan became available. Timing the end of Marketplace coverage to match the employer plan effective date is the cleanest approach.
What if the employer's eventual coverage will be affordable? Can the client still use APTC during the gap?
This is the nuanced case. If the employer has already made a formal offer of coverage and that coverage is affordable (under 9.02 percent of MAGI for 2026), the client is technically ineligible for APTC even during the waiting period. The formal offer, not the coverage effective date, triggers the affordability test in some circumstances. In practice, if no offer letter has been extended yet and the client has only verbal assurance of coverage, the situation is less clear. Brokers should document what the employer has communicated and when, and advise clients to report changes to Healthcare.gov when the formal offer is extended.
What is a bridge plan and when does it make sense during a waiting period?
A bridge plan is a Marketplace QHP used for short-term coverage between employer plan start dates. For a 90-day waiting period, a bridge plan covers roughly 2 to 3 months of the gap. Whether it makes financial sense depends on the monthly premium after APTC, the deductible reset (the Marketplace plan has a separate deductible from the employer plan), and the likelihood of the client needing care during the gap. For healthy clients with low Marketplace premiums after APTC, a bridge plan is often worth it. For clients with high MAGI who receive little or no APTC, short-term coverage options may be worth comparing, though those products are not ACA-compliant and carry their own limitations.
