21st Century Cures Act: Small Employer Changes under the Affordable Care Act

President Obama has signed the 21st Century Cures Act, Pub. L. No. 114-225 (Dec. 13, 2016). As we previously mentioned, the new legislation permits small employers (those that are not considered applicable large employers under the Affordable Care Act (ACA)) to maintain general-purpose stand-alone Health Reimbursement Arrangements (HRAs) if they do not offer a group health plan to any of their employees. Stand-alone HRAs were not permitted based on ACA guidance. Annual benefits under these new HRAs cannot exceed an indexed maximum of $4,950 per year ($10,000 if family members are covered), must be funded solely by employer contributions (employee contributions are not permitted), and can only be used for the reimbursement of Internal Revenue Code §213(d) medical care expenses.