medical expenses on a tax-favored basis. Although HRAs provide significant tax benefits, they are subject to strict plan design rules. However, a final rule expands the use of HRAs, effective for plan years beginning on or after Jan. 1, 2020. Beginning in 2020, the different types of available HRA plan designs are:
- HRAs integrated with group health plans (GHP-HRAs)
- Individual coverage HRAs (ICHRAs) – effective for 2020
- Excepted benefit HRAs (EBHRAs) – effective for 2020
- Qualified small employer HRAs (QSEHRAs)
- HRAs that only pay excepted benefits; and
- Retiree-only HRAs
Contact your Cowden representative for more information on this or other compliance issues.