Proposed rule would expand use of health reimbursement arrangements

The departments of Labor, Health and Human Services, and the Treasury today proposed new rules related to how employers may use health reimbursement arrangements to provide health coverage to employees. In particular, the rule would expand the uses of HRAs to include payment of premiums for individual market coverage in some instances. The departments estimate that the proposed changes would impact coverage for approximately 10.7 million individuals, decrease the number of uninsured by 800,000 and cost the federal government approximately $30 billion in lost tax revenue from 2020-2028. The departments issued the proposed rule in compliance with an October 2017 Executive Order on “Promoting Healthcare Choice and Competition Across the United States” and suggest that these changes would help make coverage more affordable for small to mid-sized employers, as well as provide employees with more coverage options. Comments are due 60 days after the rule is published in the Federal Register.