No. The cumulative hours-of-service condition with respect to part-time employees is not considered to be designed to avoid compliance with the 90-day waiting period limitation. Accordingly, coverage for the employee under the plan must begin no later than the 91st day after the employee completes 1,200 hours. If the plan’s cumulative hours-of-service requirement was more than 1,200 hours, the requirement would be considered to be designed to avoid compliance with the 90-day waiting period limitation.
General rule. A group health plan, and a health insurance issuer offering group health insurance coverage, must not apply any waiting period that exceeds 90 days. If, under the terms of a plan, an employee can elect coverage that would begin on a date that is not later than the end of the 90-day waiting period, this requirement is considered satisfied. Accordingly, a plan or issuer in that case will not be considered to have violated this requirement solely because employees (or other classes of participants) may take additional time (beyond the end of the 90-day waiting period) to elect coverage.
Eligibility conditions. Eligibility conditions that are based solely on the lapse of a time period are permissible for no more than 90 days. Other conditions for eligibility under the terms of a group health plan are generally permissible under Public Health Service Act Sec. 2708 unless the condition is designed to avoid compliance with the 90-day waiting period limitation.
Source: HHS Reg. §147.116(e), Example 8.