As part of our mission to promote education and awareness for health reimbursement arrangements and build upon HRAs to improve the stability and affordability of individual health coverage, industry and policy experts at the HRA Council publish regular commentary on the state of HRA legislation, adoption, and regulatory changes. Our December update is from HRA Advisor Brian Blase. We provide this information for the benefit of our members in promoting and advocating for HRAs and to the general public for a better overall understanding of this health coverage innovation.

On December 10, 2021, the Biden administration released its Fall 2021 Unified Agenda of Regulatory and Deregulatory Actions. This agenda “reports on the actions administrative agencies plan to issue in the near and long term.” The agenda is released by the Office of Information and Regulatory Affairs and is essentially the way the executive branch informs the public about the forthcoming proposed regulatory and deregulatory action planned by the federal government. 

In important news for the HRA Council, nothing related to health reimbursement arrangements (HRAs) was contained in the unified agenda. If such action was being contemplated by the administration, it would likely be on the unified agenda of at least one of the three departments with jurisdiction on the issue: the Department of Health and Human Services, the Department of Labor, or the Department of the Treasury. Although I did not expect the departments would have a proposed rule regarding ICHRAs, it is a positive development nonetheless that no such proposed action is listed on the Fall 2021 Unified Regulatory Agenda. At this time, any such actions would likely propose to restrict the opportunities, and related flexibilities, for employers to utilize ICHRAs, likely around employee classes. If a proposed rule related to ICHRAs was on the regulatory agenda, it would also increase uncertainty about the future of ICHRAs.

While there are no references to HRAs on the unified agenda, there are several references to future proposed rules that are likely of interest to HRA Council members: 1) the 2023 Notice of Benefit and Payment Parameters (NBPP), 2) a rule on short-term plans, and 3) a rule related to the affordability of exchange coverage, particularly for dependents. It is possible that this third item could contain an administrative ‘fix’ to the so-called family glitch although there are questions about whether IRS and Treasury have legal authority for an administrative fix.

2023 NBPP

Date listed for proposed rule: December 2021

Departments Involved: HHS/CMS

Abstract: “This annual proposed rule would set forth payment parameters and provisions related to the risk adjustment programs; cost-sharing parameters; and user fees for issuers offering plans on Federally-facilitated Exchanges and State-based Exchanges using the Federal platform. It would also provide additional standards for several other Affordable Care Act programs.”

Short-Term Limited-Duration Insurance; Updated (CMS-9904)

Date listed for proposed rule: August 2022

Departments Involved: HHS/CMS; Department of Labor/Employee Benefits Security Administration; Treasury/IRS

Abstract: “This rule would propose amendments to the definition of ‘short-term, limited-duration insurance’ under section 2791(b)(5) of the Public Health Service Act. The rule’s proposals would be designed to ensure this type of coverage does not undermine the Affordable Care Act, including its protections for people with pre-existing conditions, the Health Insurance Exchanges, or the individual, small group, or large group markets for health insurance in the United States.”

Guidance Under Section 36B Regarding the Premium Tax Credit

Date listed for Proposed Rule: November 2021

Departments Involved: Treasury/IRS

Abstract: “Executive Order 14009, Strengthening Medicaid and the Affordable Care Act (ACA), directs the Secretary of the Treasury to review all existing regulations and other agency actions to determine whether the actions are inconsistent with the policy to protect and strengthen the ACA and, in particular, review policies or practices that may reduce the affordability of coverage or financial assistance for coverage, including for dependents. The Treasury Department and the IRS have reviewed the regulations under section 36B and are proposing regulatory changes in accordance with E.O. 14009.”

Importantly, the executive branch can take regulatory or deregulatory actions that are not on the unified agenda. Moreover, the presence of a potential regulatory or deregulatory action on the unified agenda does not mean that the executive branch will propose a rule, much less finalize it. The timeline listed for proposed regulatory action is often ambitious, meaning it is more likely that an action will be proposed after the timeline stated in the unified agenda than before that timeline.

Also importantly, these notices are for proposed rules. After a rule is proposed, the public normally has 60 days to comment on the proposed rules. After the comment period closes, the Department or Departments authoring the rule review the comments and draft a final rule. The final rule must go through a review and clearance process that normally takes at least a month and can take many months. Finally, after a rule is finalized, there is usually at least 60 days before a rule takes effect.