’Integration’ conditions
The regulation permits an HRA to be “integrated” with certain qualifying individual health plan coverage. In order to be integrated with individual market coverage, the HRA must meet several conditions:- Any individual covered by the HRA must be enrolled in health insurance coverage purchased in the individual market, and must substantiate and verify that they have such coverage;
- The employer may not offer the same class of individuals both an HRA and a “traditional group health plan”;
- The employer must offer the HRA on the same terms to all employees in a “class”;
- Employees must have the ability to opt out of receiving the HRA;
- Employers must provide a detailed notice to employees on how the HRAs work;
- Employers may not create a class of employees younger than age 25, whom they might want to keep in their group plan because they’re healthier.
- For employers with one to 100 employees, a class cannot have less than 10 employees; for employers with 100 to 200 employees, the minimum class size is 10% of the workforce; and for employers with 200 or more employees, the minimum class size is 20 employees.
