The health care landscape in general is always changing, and health reimbursement arrangement (HRAs) are a hot topic in Washington right now. Get the slides for our latest webinar to get the details about what's new with HRAs, plus expert analysis.

1. 01 / 13
HRA regulatory update 20190619 V1R1
What’s up in Washington:
HRA regulatory update

2. Caitlin Bronson, PeopleKeep Content Marketing Manager
A professional communicator in the insurance space, Caitlin has worked
with brokers, agencies, and financial advisors to navigate health care
reform and other policy changes.
You can find her contributions at www.peoplekeep.com/resources.
About the presenter
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HRA regulatory update 20190619 V1R1

3. Our story
PeopleKeep helps small businesses offer competitive
benefits at a price they can afford. Personalized benefits
automation software from PeopleKeep allows businesses
to manage their benefits in minutes per month.
PeopleKeep automates benefits compliance and employee
support. Employees receive tax-advantaged
reimbursements to pay for health insurance and other
medical, dental, and vision expenses. Today more than
3,000 companies across the United States trust PeopleKeep
to automate their benefits and keep employees happy.
PeopleKeep is based in Salt Lake City, Utah.
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HRA regulatory update 20190619 V1R1

4. Agenda
The individual coverage HRA (ICHRA)
The excepted benefit HRA
What does the new rule mean for the market?
What the rule does
Q&A
Where did the new HRA rule come from?1
2
3
4
5
6
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HRA regulatory update 20190619 V1R1

5. Where did the HRA rule come from?
A regulatory timeline
HRAs have experienced a lot of upheaval.
2002–2012 Stand-alone health reimbursement arrangements
(HRAs) are available with little federal regulation.
2013 IRS Notice 2013-54 says only one-person HRAs and retiree
HRAs can integrate with individual coverage.
2016 The 21st Century Cures Act creates the qualified small
employer HRA (QSEHRA).
2018 Federal Departments release proposed rule
expanding HRAs in response to an executive order.
2019 Federal Departments finalize rule creating two new HRAs.
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HRA regulatory update 20190619 V1R1

6. What does the new rule do?
A quick overview
The final rule does 4 important things:
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HRA regulatory update 20190619 V1R1
Revises IRS
Notice 2013-54
to allow HRAs to
integrate with
individual health
insurance under
certain
circumstances
1
Creates the
individual
coverage HRA
(ICHRA), effective
January 1, 2020
2 3
Creates the
excepted benefit
HRA, effective
January 1, 2020
Establishes a
special
enrollment
period for
employees
newly eligible for
the ICHRA
4

7. The individual coverage HRA (ICHRA)
How does it work?
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HRA regulatory update 20190619 V1R1
1. Business offers a
monthly allowance.
There are no minimum
contribution requirements or
maximum allowance caps, and
businesses can alter monthly
allowances by 11 employee
classes (as well as age and
number of dependents).
2. Employees purchase
health care.
All items listed in IRS Publication
502, including individual health
insurance premiums, are
reimbursable through
the ICHRA.
3. Business
reimburses
employees.
ICHRA reimbursements are
free of payroll tax and
income tax.

8. The individual coverage HRA (ICHRA)
Employee eligibility
Businesses can determine
eligibility by 11 classes:
● Full-time* or part-time* employees
● Salaried* or hourly* employees
● Seasonal employees
● Temporary employees
● Employees in different locations*
● Employees in a waiting period
● Employees covered under a collective
bargaining agreement
● Foreign employees who work abroad
● A combination of two or more classes
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Required minimum class sizes if
offering with group health
insurance:
● 10 employees for businesses with
fewer than 100 employees
● 10 percent of the total number of
employees for businesses with
100–200 employees
● 20 employees for employers with
more than 200 employees
*Minimum class sizes apply
HRA regulatory update 20190619 V1R1

9. The individual coverage HRA (ICHRA)
Employee allowance amounts
Businesses can set different
allowance amounts for 11 classes:
● Full-time or part-time employees
● Salaried or hourly employees
● Seasonal employees
● Temporary employees
● Employees in different locations
● Employees in a waiting period
● Employees covered under a collective
bargaining agreement
● Foreign employees who work abroad
● A combination of two or more classes
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Businesses can set different allowance
amounts within classes based on:
● Age
○ Can offer up to 3 times as much to the
oldest employees in the class vs. the
youngest employees in the class
● Number of dependents
○ Can offer more to employees with
additional dependents with no
restrictions
HRA regulatory update 20190619 V1R1

10. The individual coverage HRA (ICHRA)
How does it compare with the QSEHRA?
QSEHRA
January 1, 2017, onward
ICHRA
January 1, 2020, onward
Business size requirements Fewer than 50 FTE employees. None.
Employee eligibility guidelines All full-time employees are automatically eligible. Employers can decide based on 11 employee classes.
Allowance guidelines In 2019, $5,150 for single employees;
$10,450 for employees with a family.
Employers can offer different allowance amounts
based on 11 employee classes.
Individual coverage guidelines Employees can have individual coverage, but they
don’t need it to participate.
Employees must have individual coverage to
participate.
Group health policy requirements Can’t offer with a group policy. Employees can’t have a choice between group and the
ICHRA, and eligibility guidelines must meet minimum
size standards.
Premium tax credit requirements PTC reduced by QSEHRA allowance. Employees must choose between PTC and ICHRA.
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HRA regulatory update 20190619 V1R1

11. The excepted benefit HRA
How does it work?
The excepted benefit HRA reimburses employees up to $1,800 a year
for excepted benefits, such as:
1. Dental insurance
2. Vision insurance
3. Long-term care insurance
4. Short-term limited-duration insurance (STLDI), if permitted under state law
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HRA regulatory update 20190619 V1R1

12. What does the new rule mean for the market?
Analysis
● Impact on small businesses: GOOD
● Impact on the individual health insurance market: UNCERTAIN
● Impact on employee health benefits: GOOD
→ What does this mean for PeopleKeep’s 2020 offerings?
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HRA regulatory update 20190619 V1R1

13. Thank you for attending today’s
webinar!
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HRA regulatory update 20190619 V1R1