The Depart­ment of the Trea­sury (Trea­sury), Depart­ment of Labor (DOL), and Depart­ment of Health and Human Ser­vices (HHS) (col­lec­tive­ly, the Depart­ments) released their pro­posed rule regard­ing health reim­burse­ment arrange­ments (HRAs) and oth­er account-based group health plans. The DOL also issued a news release and fact sheet on the pro­posed rule.

The pro­posed rule’s goal is to expand the flex­i­bil­i­ty and use of HRAs to pro­vide indi­vid­u­als with addi­tion­al options to obtain qual­i­ty, afford­able health­care. Accord­ing to the Depart­ments, these changes will facil­i­tate a more effi­cient health­care sys­tem by increas­ing employ­ees’ con­sumer choice and pro­mot­ing health­care mar­ket com­pe­ti­tion by adding employ­er options.

To do so, the pro­posed rules would expand the use of HRAs by:

  • Remov­ing the cur­rent pro­hi­bi­tion against inte­grat­ing an HRA with indi­vid­ual health insur­ance cov­er­age (indi­vid­ual coverage)
  • Expand­ing the def­i­n­i­tion of lim­it­ed except­ed ben­e­fits to rec­og­nize cer­tain HRAs as lim­it­ed except­ed ben­e­fits if cer­tain con­di­tions are met (except­ed ben­e­fit HRA)
  • Pro­vid­ing pre­mi­um tax cred­it (PTC) eli­gi­bil­i­ty rules for peo­ple who are offered an HRA inte­grat­ed with indi­vid­ual coverage
  • Assur­ing HRA and Qual­i­fied Small Employ­er Health Reim­burse­ment Arrange­ment (QSEHRA) plan spon­sors that reim­burse­ment of indi­vid­ual cov­er­age by the HRA or QSEHRA does not become part of an ERISA plan when cer­tain con­di­tions are met
  • Chang­ing indi­vid­ual mar­ket spe­cial enroll­ment peri­ods for indi­vid­u­als who gain access to HRAs inte­grat­ed with indi­vid­ual cov­er­age or who are pro­vid­ed QSEHRAs

Pub­lic com­ments are due by Decem­ber 28, 2018. If the pro­posed rule is final­ized, it will be effec­tive for plan years begin­ning on or after Jan­u­ary 1, 2020.


by Karen Hsu
Orig­i­nal­ly post­ed on