The White House; President Trump signs Executive Order

Executive Order May Lead to HRA Regulatory Expansion

The White House; President Trump signs Executive Order HRAThrough an executive order signed Thursday, October 12, President Donald Trump lifted some insurance rules that were put in place by the Affordable Care Act (ACA). The President’s executive order, “Promoting Healthcare Choice and Competition Across the United States,” prioritizes three areas for his Administration: association health plans, short-term limited-duration insurance, and Health Reimbursement Arrangements (HRAs).

The Employers Council on Flexible Compensation (ECFC) published the following summary about the executive order.

Today, President Trump signed an executive order directing the Departments of Treasury, Labor and Health and Human Services to review and potentially revise the following guidance:

  • The Secretary of Labor is asked to consider expanding the current rules regarding Association Health Plans (AHPs) to potentially allow an AHP to be offered across state lines to organizations within the same line of business or allow organizations in a state or metropolitan area to form a AHP.  These AHPs would not be allowed to exclude any employee from joining the plan or to develop premiums based on health conditions.
  • The Secretaries of the Treasury, Labor and HHS are asked to consider changes to the rules regarding Health Reimbursement Arrangements so that employers can make better use of them for their employees.  Changes that could be considered are allowing the payment of insurance premiums by an HRA and allowing free-standing HRAs.
  • The Secretaries of the Treasury, Labor and HHS are asked to consider whether to expand the availability of low cost short-term limited duration insurance.

Under the ACA, standard HRAs cannot be used to purchase health insurance on the open market. However through the Cures Act signed by President Barack Obama in December 2016, small businesses (those with fewer than 50 full-time employees) are allowed to offer Qualified Small Employer HRAs (QSEHRAs) that can be used to pay for health insurance premiums in addition to eligible medical expenses.

DataPath, Inc. is a proud member of ECFC. ECFC is a nonprofit organization dedicated to the advocacy, education, advancement, and innovation of tax-advantaged benefit programs that facilitate choice for employers and their employees. Learn more about ECFC.

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