In a major victory for NAHB and its member home builders and other small businesses, President Obama signed the 21st Century Cures Act into law on Dec. 13, 2016. At NAHB’s urging, lawmakers included a provision in this comprehensive health care package to allow employers to provide Health Reimbursement Arrangements (HRAs) to help their employees pay for health insurance.
NAHB had spearheaded efforts to reinstate the use of HRAs since the IRS issued guidance prohibiting their use. “This bipartisan legislation is an important step forward to allow small business owners to help their workers with rising health care costs and to ensure more Americans receive affordable health coverage. At the same time, it will protect employers against outrageous fines for providing this cost-sharing option to their workers,” NAHB Chairman Ed Brady said in a press release.
HRAs allow small businesses to offer pre-tax dollars to insured employees to help pay premiums and other out-of-pocket costs associated with medical care and services. Most small companies do not have human resource departments or benefits specialists. HRAs offer these businesses a simpler, easier way to help their employees to obtain health coverage.
Learn how you can use HRAs in this backgrounder and FAQ.