President Trump announced at a White House event today that the administration has finalized a rule
to expand the use of health reimbursement arrangements (HRAs).
"NAHB commends President Trump for taking steps to reduce health care costs for businesses and workers alike by promoting the increased use of health reimbursement arrangements," said NAHB Chairman Greg Ugalde, who attended the White House briefing. "With health care costs soaring, HRAs are important tools that allow home builders and other small businesses to help their workers defray the high cost of insurance premiums and other out-of-pocket medical expenses. Expanding the availability and permitted use of HRAs through issuance of this final regulation will help bring choice and affordability to the health care marketplace."
HRAs allow employers to offer pre-tax dollars to insured employees to help pay premiums and/or other out-of-pocket costs associated with medical care and services.
The Departments of Treasury, Health and Human Services, and Labor last year proposed a new regulation that expands the effectiveness of HRAs to help employees pay for health insurance. The final rule allows HRAs to be used to cover the cost of health insurance premiums. Medical expense reimbursements from HRAs are tax-preferred, providing a similar tax advantage as employer-sponsored insurance coverage.
The final rule further allows employers that offer traditional health insurance to also offer an HRA up to $1,800 to cover other qualified medical expenses, such as premiums for vision and dental insurance.
NAHB led the fight for Congress to reinstate HRAs in 2016, which help home building firms and other small businesses provide health benefits to their employees. Most small companies do not have human resource departments or benefits specialists. HRAs offer these businesses a simpler way to help their employees obtain health coverage.
For more information, contact Alexis Moch
at 800-368-5242 x8407.