The 2014 '30 Under 30'

Congrats to this year's 30 -- check out the full list here!

Paid intern? Under the employer mandate, you get health insurance

Obamacare protestHeather Montgomery had the upcoming spring semester at Clemson University all planned out. The college sophomore secured an internship with a Maryland-based print company in March 2012, putting her well on her way to fulfilling a degree requirement mandated by the university’s Graphic Communications program of completing two internships.

The internships could be either paid or unpaid, and interns are required to work full-time — 40 hours each week. The company she planned to work for would pay her $10 an hour and provide her with housing, she told Red Alert Politics.

But the Clemson student received an email in October saying her internship had been cancelled — because of Obamacare.

“I have some bad news,” the email stated. The program’s internship coordinator “brought up some issues to the employers at [Clemson's job fair] about Obamacare. With the current uneasy state of what is going on with the government and what wasn’t foreseen by [the company], there is a chance that we may have to suspend our internship program temporarily to avoid a $7,000 fee.

“Since there is no clause about internships, we are not sure what to do,” the email continues. “… I will keep you updated when we know what is going on with the ACA. Sorry about this inconvenience, as it was very unexpected.”

It’s an unforeseen consequence of Obamacare’s employer mandate and a subject neither the Internal Revenue Service nor the Department of Health and Human Services has broached, at least not publicly. Many interns work more than 30 hours each week, and if they’re completed during the fall or spring semesters, interns work a minimum of 90 days. Under the employer mandate, they’re considered full-time employees, and companies are therefore required to provide them with health insurance.

According to Sarah Swinehart, communications director for the House Ways and Means Committee, paid interns are considered employees, and companies would therefore have to cover them under the employer mandate.

After the Affordable Care Act was passed by Congress in 2010, the IRS released more than 18 pages of regulations specifically to help employers determine the difference between part-time and full-time employees, and whether or not they would be required to provide workers with health insurance.

According to the document, some employees are exempt from receiving coverage because of a labor statute called the safe harbor exemption. The provision includes seasonal and agricultural workers, and the IRS uses the example of a ski instructor. But interns are neither included nor defined in the exception.

“Seasonal right now, according to the IRS, is agricultural seasonal workers or holiday retail,” Robert Olson, a San Diego-based labor attorney, said

Olson added he has not seen interns categorized yet, “and the only way interns have been classified is through that Supreme Court opinion and the Department of Labor’s opinion. And if you don’t meet those qualifications, then you’re considered an employee.”

The Department of Labor classification mentioned by Olson is in reference to a six-pronged test to work as an unpaid intern.

To be deemed full-time, the IRS states employees must work more than 30 hours each week for 120 days. Those days, however, do not have to be consecutive but must be within 360 days. And for some interns, including Montgomery, internships last beyond that time frame.

At General Electric, for example, interns work more than 30 hours each week. The program is offered in the fall, spring and summer semesters, and some stay on for consecutive terms — even working as long seven months. The company, a spokeswoman told Red Alert, has not yet broached the topic of healthcare for their interns.

Edmund Haislmaier, a healthcare policy expert at The Heritage Foundation, said interns generally would qualify for the safe harbor exception. But he, too, said the agency has not yet included them.

This uncertainty, Haislmaier said, is one of many surrounding the employer mandate and an aspect of why it was delayed.

“The proposed rule on the employer mandate of Jan. 2, 2013 does not specifically address how paid interns are to be treated for purposes of the employer mandate,” he wrote in an email. “The Administration has not yet issued a final rule that will, presumably, [be] addressing this and other issues relating to the employer mandate.”

Neither the IRS nor HHS returned Red Alert’s request for comment.

Olson, though, said this issue also affects companies that employ less than 50 workers and take on paid interns, too.

“The more unchartered territory is those that are on the cusp, the 50-employee cusp,” he said. “They’re going to be more cautious in creating an internship program.”

If paid interns do, indeed, qualify for coverage under the employer mandate, companies may think twice before taking on a number that would push them over the 50-employee threshold.

The Obama administration has more than a year before the employer mandate takes effect, but Olson noted the issue of providing paid employees health insurance is not one many companies are aware of.

“They haven’t thought of it yet,” he said. “They only know as much as what the media might put out but don’t know how they will be affected. … It’s just a matter of being aware and trying to keep up with what’s coming up from the government.”

Montgomery, in the meantime, said Clemson University is looking into altering its internship requirements in anticipation of the employer mandate’s regulations. The university did not return Red Alert’s request for comment.

But until 2015, all companies can do is wait.

 

Comments

Polititainment

'True Blood' star takes on Sarah Palin

Kristin Bauer van Straten, who plays vampire Pam Ravenscroft on the HBO program, hit back at the former governor of Alaska for criticizing a recent episode.

Cher rants against Rand Paul
Thrown in between tweets about toothaches, costumes and pool time, Cher decided to rant about Sen. Rand Paul on Twitter Friday night. It was not clear what prompted the Twitter tirade. Cher had just finished giving an update on her toothache and five new “unbelievable” costumes when she switched gears. Mediaite postulated that she may […]
Joel helps explain GOP view on jobs
Apparently John Boehner’s press team is made up entirely of Billy Joel enthusiasts. The Library of Congress announced on Tuesday that this year’s Gershwin Prize for Popular Song will go to Joel. The prize “honors artists whose work has left a lasting impact on audiences and inspired new generations of performers.” And John Boehner’s press […]
Joan Rivers rips media over Israel

In which Joan Rivers takes a sledgehammer to the media.

Fla. pol proposes mandated D'Souza show

Florida State Senator Alan Hayes, according to a report in The Hollywood Reporter, is planning on introducing legislation to mandate that all Florida high schools show Dinesh D’Souza’s new film "America." That is, unless parents don’t want their kids to see it.

White House

Golfer finds Obama’s golf ball in the woods, says president’s game is ‘off line’
President Barack Obama is “off line again.” Or at least his golf game appears to be. Instagram user larrydoh posted a picture of a Titleist 44 golf ball labeled “POTUS” on Saturday. He found the golf ball at the Congressional Country Club, one day after POTUS played the same course himself. “Obama played at Congressional […]
Polls: Obama White House incompetent at managing, worse than Darth Vader

The job of the administrative branch is to, well, administer the laws. According to a new Fox News poll released on Wednesday, most Americans think that the Obama administration is failing dismally at the task.

Obama wants ‘idealism and optimism’ for millennials in face of Congressional ‘crisis,’ refuses to recognize he is part of the problem
Now that “hope and change” seems to be played out, President Barack Obama has come up with a new catchphrase for millennials – “idealism and optimism.” In a speech at a Democratic National Convention fundraiser in Seattle, Wash. Tuesday night, Obama asked young people not to give up their natural idealism and optimism because of […]
President Obama admits he does not watch the news

During a speech during a Democratic National Committee event in Seattle, Washington Tuesday night, President Obama confessed that he doesn't watch the news. Throughout the speech, Obama predictably complained about the incompetence of our "broken" Congress and urged his liberal audience to get enthusiastic about voting for Democrats in the midterm elections this fall.

Congress and the President actually take action, Obama says ‘it’s so much fun’
“Girls just want to have fun,” Cyndi Lauper belts in her famous song. Apparently President Barack Obama wants to join her. “Let’s do this more often. It’s so much fun,” Obama said at a bill signing on Tuesday. Obama gathered in White House with members of Congress to sign the Workforce Innovation and Opportunity Act. This […]

Congress

Congresswoman's 'miracle baby' turns one
Rep. Jaime Herrera Beutler (R- Wash.) and her husband Dan recently celebrated the first birthday of their “miracle baby,” Abigail Rose. The couple learned early into the congresswoman’s pregnancy that their baby had Potter’s Syndrome. The condition causes a lack of amniotic fluid which prevents the baby’s growth and development, especially of the kidneys. Jaime […]
Obama throws more fuel on lawsuit fire
It appears President Barack Obama plans to keep up his “So sue me” attitude this week. House Speaker John Boehner penned an op-ed Sunday in USA Today that outlined the specifics of the planned lawsuit against the president. He had announced in late June that he would file a lawsuit against Obama on behalf of the […]
Norton: 'You don't have a right to know'

Del. Eleanor Holmes Norton played down the importance of government transparency during a House hearing Friday, speaking out against Republican-led attempts to compel a White House official to appear before the Government and Oversight Committee.

Politicians struggle to 'live the wage'

Goodbye three-course power lunches at swanky D.C.  steakhouses. Hello Ramen noodles and PB&J.

Paul Ryan unveils new anti-poverty agenda

In another example of the Republican Party expanding its policy tent, Rep. Paul Ryan (R-Wis.) unveiled a new poverty-fighting agenda Thursday at the American Enterprise Institute.