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HRA Guidance: Permanent Fix Needed for Small Employers, Says NASE


Isaac M. O’Bannon, Managing Editor CPA Practice Advisor On Feb 18, 2015

One of the nation’s leading advocacy groups for self-employed and micro-businesses says that, while the delay in enforcement of the technical guidance issued by the Treasury Department on Health Reimbursement Arrangements (HRAs) is a good move, self-employed workers really need a permanent solution.

Katie Vlietstra, Vice President for Government Relations and Public Affairs for the National Association for the Self-Employed (NASE) released the following comment on the issue:

“The announcement today by the Treasury Department that it has offered a short-term delay in the enforcement of a prohibition on Health Reimbursement Arrangements is welcome news for our community, but a long-term, legislative solution is still urgently needed.  America’s smallest employers need the stability of a permanent fix in order to continue to utilize this critical tool to help provide health care coverage to their employees.

“We support Congressmen Boustany and Thompson’s plans to re-introduce their bipartisan legislation focused on offering a permanent correction to this issue.  This bipartisan legislation would order the IRS to reverse its regulation preventing small businesses from providing standalone HRAs so that they can support their employees and help them obtain affordable health care. Their legislation, combined with the momentum by Senate Republicans and Democrats to address this issue, will help millions of small business owners and should be passed by Congress as soon as possible.

“HRAs have long-been used to help small business owners provide some level of financial support for their employees. As an unintended consequence of the Affordable Care Act (ACA), the prohibition placed upon the use of HRAs is detrimental to small businesses and their employees across the country.  Although we welcome this temporary, first step, we look forward to working with members on both sides of the aisle in Congress on a more permanent solution to this situation.”

NASE is a leading supporter of the Small Business Healthcare Relief Act, which would allow for standalone health reimbursement arrangements for small employers (49 or less employees) championed by U.S. Reps. Charles Boustany (R-LA) and Mike Thompson (D-CA). In fact, NASE has been active in advocating for a long-term solution to this issue with members of the Obama Administration, including Health and Human Services Secretary Sylvia Burwell.


Core Documents, Inc. has been providing free consulting, affordable plan documents, and plan updates as needed for Section 125 Cafeteria Plans and Health Reimbursement Arrangements since 1997. See more information about these fringe benefit plans at Core Documents’ website: https://www.coredocuments.com, or call toll free 1-888-755-3373.

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