Zane Benefits Publishes New Guidance on “Integrated” Health Reimbursement Arrangements

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The Department of Labor Posted a New Set of FAQs to Clarify What Criteria Health Reimbursement Arrangements (HRAs) Must Meet in Order to be Considered "Integrated" Under Section 2711 of the PHS Act

Today, Zane Benefits, Inc. published new guidance on “Integrated” Health Reimbursement Arrangements. Zane Benefits, which provides comprehensive and flexible alternatives to traditional employer sponsored health benefits, is the leader in defined contribution and health reimbursement accounts.

According to Zane Benefits’ website, On January 24th, 2013, the Department of Labor posted a new set of FAQs to clarify what criteria Health Reimbursement Arrangements (HRAs) must meet in order to be considered "Integrated" under Section 2711 of the PHS Act. As expected, the FAQs clarify that an HRA is not considered "integrated" unless:

1.    The employer offers primary group health insurance coverage that alone satisfies Section 2711, and

2.    The HRA is only made available to those employees who are enrolled in the primary group health plan coverage outlined in #1.

The FAQ also notes that the federal government plans to issue additional guidance on HRAs and Section 2711. Read on for more information on how future guidance could affect your HRA plan design.

Background on Health Reimbursement Arrangements (HRAs)

According to Zane Benefits’ website, HRAs are a type of account-based group health plan and typically consist of a promise by an employer to reimburse medical expenses for the year up to a certain amount, with unused amounts available to reimburse medical expenses in future years (see Notice 2002-45). By its definition, an HRA imposes annual limits. That is, reimbursements an HRA participant may receive during a year are limited to the balance of his or her notional HRA account.

Background on Section 2711 of PHS Act and HRAs

According to Zane Benefits’ website, Section 2711 of the Public Health Service Act, as added by the Patient Protection and Affordable Care Act, generally prohibits group health plans from placing lifetime and annual limits on the dollar value of "essential health benefits". On June 28th, 2010, the federal government issued interim final regulations requesting comments regarding the application of the annual limit provisions to certain stand-alone HRAs. To date, a "Final Rule" has not been issued on whether HRAs violate the Statute. However, the new FAQs hint that the departments plan to make certain HRA plans subject to the annual limit requirements.

What Does This Mean for HRAs?

According to Zane Benefits’ website, Based on the existing regulations, the following HRA plans will avoid the annual limit requirements of Section 2711:

1.    "Integrated" HRAs
2.    "Flexible Spending Arrangement" HRAs
3.    "Excluded" HRAs
4.    "Excepted" HRAs
5.    "Retiree" HRAs

What does this mean for existing HRAs? If your HRA does not currently fall into one of the above categories, you may need modify your HRA plan to avoid falling out of compliance with Section 2711.

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About Zane Benefits

Zane Benefits was founded in 2006 to provide a revolutionized SaaS (Software-as-a-Service) administration platform ("ZaneHRA") for Health Reimbursement Arrangement (HRAs) and defined contribution healthcare. The flagship software provides a 100% paperless administration experience to employers and insurance professionals that want to offer better health benefits without a traditional group health insurance plan at lower costs. For more information about ZaneHRA, visit

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Ryan Knapp
Zane Benefits
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