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Zane Benefits Publishes New Information on HRAs and Minimum Value and Affordability
Date:7/19/2013

Park City, Utah (PRWEB) July 19, 2013

Today, Zane Benefits, the online solution to small business health insurance, published new information on HRAs and Minimum Value and Affordability.

According to Zane Benefits’ website, the Internal Revenue Services (IRS) released proposed guidance on the minimum value and affordability rules under the Patient Protection and Affordable Care Act (PPACA), including how health reimbursement arrangements (HRAs) will be used in determining minimum value and affordability.

Employers with 50+ employees that also offer an integrated HRA should use these guidelines for calculating if their health coverage meets minimum value and affordability.

Here are four important PPACA concepts to be familiar with before understanding the proposed rules on minimum value and affordability:

1. Integrated HRA: An integrated HRA is a Health Reimbursement Arrangement (HRA) that is offered alongside an employer-sponsored group health plan (usually a high-deductible plan).

2. Applicable Large Employer: PPACA defines an applicable large employer as 50+ full time equivalent (FTE) employees.

3. Minimum Value (MV): According to PPACA, a plan provides MV if the plan's share of the total allowed cost of benefits provided under the plan is at least 60%. In other words, it has an actuarial value (AV) of 60%.

4. Affordability: PPACA considers coverage affordable if an employee’s required premium contribution (for self-only coverage only) does not exceed 9.5% of household income.

The proposed rules address how employer contributions toward an integrated HRA will count toward the plan's minimum value and affordability.

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