Experts Caution Against New Proposed Federal Rule on HRAs

Experts Caution Against New Proposed Federal Rule on HRAs

The formal comment period has come and gone now for a proposed new federal rule that could open the door for employers to pay the premiums for employees’ individual health plans.  (See earlier ETC story here:  New Federal Rule Could Open Door for Employer Paid Individual Plans )

To no one’s surprise, there were a number of comments filed in opposition to the proposed from a variety of different stakeholders.

Pennsylvania Insurance Commissioner Jessica Altman had a bouquet as well as a couple of bricks on the proposal, noting that there were good safeguards against discrimination based on health status or other characteristics and this would help the health insurance market stability.  Alternatively, she wrote, it could allow employers to push high-risk workers out of their group plans and into buying short-term, limited duration plans.

“If you’re going to pay less for insurance, you’re probably going to get less for the insurance, and that’s part of the fear,” Commissioner Waltman said.

One commenter wrote that he was concerned the rule might permit employees to be divided into healthy and unhealthy groups, something that can leave people without needed care and destabilize an insurance pool.

The America’s Health Insurance Plan (AHIP) association likewise had good and bad to say about the proposed rule:

“If properly regulated and implemented, access to new HRA options will give employers and consumers more choices on where to get their health insurance. With proper safeguards and careful planning, HRAs will create new opportunities for businesses of all sizes to offer new coverage options to their employees while strengthening the individual market with new potential enrollees.”

AHIP offered this admonition: “However, enforceable safeguards and non-discrimination protections are essential for these options to work for Americans. Clear rules on when an HRA can be offered, what types of plans can be purchased using these funds and on what terms will be key.”

Your Takeaway – It is important to understand that this proposal is, at the moment, just that: a proposal.   No doubt the federal agencies are continuing to review all the comments and concerns brought to them.  There is no time frame on these things and no deadline. 

ETC will keep you fully apprised if or when anything develops on this issue.

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