Small employers will probably be able to give workers cash for individual health coverage premiums in 2017 without worrying about the federal government coming after them.
Members of the Senate today made that likely by voting 94 to 5 for a motion that will send H.R. 34, the 21st Century Cures Act package, to President Obama for his signature.
High-profile parts of the bill provide $3 billion in funding for researching Alzheimer’s disease and other conditions, $1.8 billion in cancer research funding and $1 billion in funding for efforts to fight opioid abuse.
President Obama put out a statement welcoming Senate approval of H.R. 34.
“We are now one step closer to ending cancer as we know it,” Obama said in the statement.
The H.R. 34 package also includes major mental health parity provisions, and a section at the very end, Section 18001, that clarifies how the federal government will treat small employer efforts to use stand-alone health reimbursement arrangements to give workers cash they can use to pay the premiums for individual health coverage.
The provision, which is set to apply to plan years beginning after Dec. 31, 2016, would let small employers use “qualified small employer health reimbursement arrangements” to reimburse workers for up to $4,950 per year for employee-only coverage and up to $10,000 for family coverage. The employees using the arrangement would have to show they had health coverage.
The reimbursement cap would be adjusted for inflation.