21st Century Cures Act exempts HRAs from ACA’s market reforms — Business Management Daily: Free Reports on Human Resources, Employment Law, Office Management, Office Communication, Office Technology and Small Business Tax Business Management Daily
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21st Century Cures Act exempts HRAs from ACA’s market reforms

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in Payroll Today

Congress has passed and President Obama is expected to sign the 21st Century Cures Act, which exempts health reimbursement accounts (HRAs) set up by small employers—those with fewer than 50 full-time employees—from the Affordable Care Act’s market reform provisions.

The Senate passed a final version of the bill (H.R. 34) on Dec. 7.

Upside: The $100 per day, per employee, excise tax on any group plan that doesn’t meet those market reforms is wiped out.

Downside: Employers must report their HRA contributions on employees’ W-2s.

These provisions, including the W-2 reporting provision, are effective for years beginning after 2016.

Market reforms

HRAs, which are employer-funded, have given the IRS nothing but heartburn from the onset of health care reform.

The problem: HRAs are considered group health plans, which must meet the ACA’s market reform provisions, primarily that plans not impose dollar limits on annual or lifetime cov...(register to read more)

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{ 1 comment… read it below or add one }

George Kelly December 9, 2016 at 9:40 am

Reported on the W-2, but not reported as income… FYI employer contributions to sponsored group coverage are also reported on the W-2, Box 12 Code DD… How is that a downside? The downside may be the limit? Not the W-2 reporting…


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