In December 2016, Congress revised and revived a popular employee benefits option: the health reimbursement arrangement (HRA). Many users of the new Small Business HRA have never administered a reimbursement plan, though, and have questions on how to process employee reimbursement requests while staying compliant with the law. We’ve compiled six of the most commonly asked questions on Small Business HRA reimbursement to make sure you and your employees are comfortable with your new benefit. We’ll also go over what could lead to improper reimbursement, the consequences of improper reimbursement, and how to address improper reimbursement without incurring tax fines.
If you have workers spread across multiple states, you face unique challenges when it comes to providing your employees with health insurance. State-specific insurance requirements might make it difficult for you to cover all of your workers under a single plan. Fortunately, there are several ways to address this problem that may allow you to offer your employees the health coverage that they want.
Health care costs are projected to increase by 6.5 percent in 2017, which means they will continue to expand more rapidly than inflation. As a rising number of businesses feel the pinch, many are abandoning traditional group health insurance in favor of alternatives like the Small Business Health Reimbursement Arrangement (HRA) to help manage their health insurance costs.
The passage of the 21st Cures Act in December 2016 created a new health benefit option for small businesses—the Small Business Health Reimbursement Arrangement (HRA). Although this is a win for small businesses, it can also be a source of confusion.
Recent health-care reform initiatives, including the passage of the 21st Century Cures Act in December 2016, have ushered in significant changes that will affect the health insurance industry through 2017 and beyond. One of the new changes includes updates to Health Reimbursement Arrangements (HRAs), one of the best ways for small businesses to offer health benefits to their employees. Here are four things to know about HRAs and changes in health law for 2017.
Everyday I talk to employers, agents, or other financial professionals who ask me questions about Health Savings Accounts (HSAs), and how they function with Health Reimbursement Arrangements (HRAs) and insurance policies. See my earlier post "The difference between HRAs and HSAs" for appropriate background. A common question I receive is "Can an employee have an HRA and HSA at the same time?" The answer is: "Absolutely, yes. And they should!"
There are a lot of acronyms used when discussing nontraditional health benefits options. Two of the most popular and promising options are HSAs (Health Savings Accounts) and HRAs (Health Reimbursement Arrangements). Even though they both have a similar premise, there are a few key differences. If you have an HSA/HRA or you are considering offering one to your employees, consider the following:
Small businesses still offering noncompliant health care reimbursement plans, often called employer payment plans, were given a new chance to come into compliance under the law, as well as a new avenue in which to do so, thanks to federal legislation passed in December 2016. Under the 21st Century Cures Act, transition relief for businesses with fewer than 50 employees was retroactively extended from June 30, 2015, through December 31, 2016. That means any small business taking part in a noncompliant health care reimbursement plan won’t be subject to an IRS tax penalty until January 1, 2017. This is great news for small businesses nationwide that are searching for an affordable, compliant benefits solution for their employees, particularly with the new Small Business Health Reimbursement Arrangement (HRA) now available.
Introduction to Health Reimbursement Arrangements A Health Reimbursement Arrangement (HRA), commonly referred to as a health reimbursement account, is an IRS-approved, employer-funded, tax-advantaged employer health benefit plan that reimburses employees for out-of-pocket medical expenses and individual health insurance premiums. An HRA is not health insurance. A Health Reimbursement Arrangement allows the employer to make contributions to an employee's account and provide reimbursement for eligible expenses. An HRA plan is an excellent way to provide health insurance benefits and allow employees to pay for a wide range of medical expenses not covered by insurance. Because of federal legislation passed in December 2016, there exists a new HRA available to small businesses. For information on the Small Business HRA and the Small Business Healthcare Relief Act, see our page The Small Business Health Reimbursement Arrangement, specifically the section describing new HRA provisions for small businesses. The following article provides an overview of what an HRA is and how it's structured.
Disclaimer: The information provided on this website is general in nature and does not apply to any specific U.S. state except where noted. Health insurance regulations differ in each state. See a licensed agent for detailed information on your state. Zane Benefits, Inc. does not sell health insurance.