Pool Funding an HRA

[JRG]

We have an employer who wants to pool fund an HRA for select services, i.e., they are putting in $20,000 for their employees to pay for seeing a nurse practitioner on a first-come, first serve basis. If the $20,000 gets used up by June and some employees have not taken advantage of it then they would not receive a reimbursement for seeing a nurse practitioner later in the year. It is available to all employees. Has anyone seen this kind of arrangement before?

I think there would be some nondiscrimination issues if many HCEs used a lot of the benefits early, but I can't determine if this runs afoul of those rules.

[Chaz]

That sounds like a group health plan subject to an annual limit and one that is not integrated with the employer's major medical plan.

[lvena]

Chaz is correct.

I would question the effectiveness of this program. The idea that someone would visit a nurse practitioner for a well visit strikes me as a win for the NP (income)and a lose for the employee. What would the NP do, a check-up? To what end? The chance of finding something is very slim.

Seems to me that if the employer wanted to provide something of value, this would not be the way to go. Perhaps he should consider another benefit, such as dental, life, DI, etc.

[JRG]

Thanks,

A forgot to state this but to be eligible for the HRA benefits an employees does have to be enrolled in the employer's health coverage. Would that change your thinking?

[lvena]

Should not because it appears that the HRA you are considering is a stand-alone and not integrated into the health plan.

[Peter Gulia]

Without otherwise commenting on the wisdom of the described plan design, the employer and its employee-benefits lawyer should read section 18001 [pages 306-312] of the 21st Century Cures Act.

[leevena]

Without otherwise commenting on the wisdom of the described plan design, the employer and its employee-benefits lawyer should read section 18001 [pages 306-312] of the 21st Century Cures Act.

What am I missing? The act allows for hra if the group meets the following; 1) group is under 50/not subject to ACA, and 2) does not offer health insurance to any of its employees. JRG's 2nd post indicates a group health plan is offered.

[Peter Gulia]

Sorry if I confused anyone. I didn't read all the facts carefully enough, and missed that the employer maintains a group health plan beyond the reimbursement arrangement.

[leevena]

Sorry if I confused anyone. I didn't read all the facts carefully enough, and missed that the employer maintains a group health plan beyond the reimbursement arrangement.

Thanks for the reply. I was starting to worry I was wrong.