Compliance Q&A: PCORI Fees, Paying Insurance Premiums from HSA, QSEHRA’s and COBRA
- March 12, 2024
- Posted by: Gus Altuzarra
- Category: Compliance Q&A
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3.7.24 | PCORI FEES
Q. It is my understanding that groups must file Form 720 and pay the PCORI fee if they are self-funded or fully insured with an HRA. When calculating the average number of lives for an HRA, are dependents included in the average total for calculating the fee?
A. The IRS has a special rule for HRAs and allows the employer to assume one covered life for each employee with an HRA. No need to count dependents.
A. The IRS has a special rule for HRAs and allows the employer to assume one covered life for each employee with an HRA. No need to count dependents.
2.29.24 | PAYING INSURANCE PREMIUMS FROM HSA
Q. Can a retiree use HSA funds to pay insurance premiums before becoming eligible for Medicare?
A. Usually, you cannot use HSA funds to pay insurance premiums, but a retired employee can use an HSA to cover COBRA premiums, Medicare premiums, or other insurance if they are receiving unemployment benefits.
A. Usually, you cannot use HSA funds to pay insurance premiums, but a retired employee can use an HSA to cover COBRA premiums, Medicare premiums, or other insurance if they are receiving unemployment benefits.
2.22.24 | QUALIFIED SMALL EMPLOYER HRAS AND COBRA
Q. A client of ours will be adding a qualified small employer HRA (QSEHRA) plan. Are these plans COBRA eligible?
A. An employer is eligible to adopt a QSEHRA only if both of the following requirements are met:
A. An employer is eligible to adopt a QSEHRA only if both of the following requirements are met:
- The employer must not be an applicable large employer (ALE) under Code Section 4980H; that is, the employer must employ fewer than 50 full-time equivalent employees in the prior calendar year.
- The employer does not offer a “group health plan” to any of its employees.
2.15.24 | HSA CATCH-UP CONTRIBUTIONS FOR FAMILY COVERAGE
Q. If a family has two people both over age 55, can they each make a $1,000 catch-up contribution to an HSA?
A. Each spouse can contribute the $1,000 catch-up to their own HSA. It is important that each have an HSA. If just one spouse has an HSA, that spouse will be limited to the family contribution plus one $1,000 catch-up contribution.
Answers to the Question of the Week are provided by Kutak Rock LLP. Kutak Rock provides general compliance guidance through the UBA Compliance Help Desk, which does not constitute legal advice or create an attorney-client relationship. Please consult your legal advisor for specific legal advice.
A. Each spouse can contribute the $1,000 catch-up to their own HSA. It is important that each have an HSA. If just one spouse has an HSA, that spouse will be limited to the family contribution plus one $1,000 catch-up contribution.
Answers to the Question of the Week are provided by Kutak Rock LLP. Kutak Rock provides general compliance guidance through the UBA Compliance Help Desk, which does not constitute legal advice or create an attorney-client relationship. Please consult your legal advisor for specific legal advice.
