A quick notice to employers offering or considering offering HRAs:
Health Reform requires that plan sponsors (employers) and health insurers pay a fee to be attributed to the Patient-Centered Outcomes Research Trust Fund.
The fund will establish a nonprofit corporation to conduct clinical effectiveness research to evaluate risks and benefits of medical treatments, services, procedures and drugs.
Who must pay the fee?
Many HRAs will be required to pay the fee. If an HRA is integrated with a self-insured health plan, it will not be subject to the fee. If an HRA is integrated with a fully-insured health plan, the insurance company and the plan sponsor of the self-insured HRA are both responsible to pay the fee.
How is the fee calculated?
The initial fee is $1.00 per average covered life. The fee increases to $2.00 in 2013. After that, it will be indexed to national health expenditures for each year until 2019 when the fee stops. The fee is based on the average number of covered lives in the plan. For HRA plans that are not integrated with a self-insured health plan, regulations state that each participant can be treated as a single life, regardless of the number of dependents.
When is this effective?
Applies to policies and plan years that end on or after October 1, 2012. The first payment of these fees is not due until July of 2013.
What are we doing to help?
Benefit Administration Group will be updating clients on this requirement as more information becomes available. We have already identified a few areas requiring more immediate clarification. We are also working to prepare an analysis tool to help employers calculate the fee.