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December 14, 2016 at 11:51 AM
Health insurance brokers are hoping the next administration will give them help with offering the new small-group cash-for-coverage plans to employers in 2017.
President Obama created the new breed of cash-for-coverage plans, or qualified small employer health reimbursement arrangements, Tuesday, by signing H.R. 34, the 21st Century Cures Act bill, into law.
Related: Small firms may get to offer cash for coverage for 2017
Major sections of the new act provide funding for research to fight conditions such as cancer and Alzheimer’s disease.
One section of the act, Section 18001, will let small employers use the Qualified Small Employer Health Reimbursement Arrangement (QSEHRA) to provide up to $4,950 in reimbursement for individual major medical premiums for 2017, and up to $10,000 in reimbursement for family coverage premiums.
Any employer that qualifies as a small employer for Affordable Care Act employer coverage mandate purposes can use the provision.
The provision is supposed to take effect for plan years starting after Dec. 31.
The QSEHRAs are comparable to another arrangement, the major medical insurance premium-only plan, that was in use before the Affordable Care Act came along.
In the past, some employers used plans created under Section 125 of the Internal Revenue Code to give employees cash to pay individual health insurance premiums.
In November 2008, for example, a benefits administrator said it had set up a Section 125 premium-only plan (POP) for Obama for America, an umbrella organization for state Democratic campaign organizations.
