Employer contributes a specified dollar amount each year to an HRA on behalf of each participant, which money can be used for deductibles and co-pays under its high-deductible health plan. As a group health plan, the HRA is subject to COBRA, but the premium is not entirely clear. I understand that there are a couple methodologies for determining the premium for COBRA purposes (e.g., actuarial method and past-cost method), but is there an argument that the premium is the employer contribution itself on top of which an administration charge up to 2% could be added? It does not seem that former employees should be eligible for continued employer contributions to the HRA; that should be limited to current eligible employees.
