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Premium Reimbursement Under the ACA: Departments Release Guidance

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On November 6, 2014, the Departments of Labor, Health and Human Services, and Treasury (the departments) issued guidance on premium reimbursement under the ACA. The guidance, issued as the 22nd installment in a series of frequently asked questions (FAQs) on the health care reform law, addresses three separate situations in which an employer assists employees with the purchase of individual policies on the insurance Exchanges by providing a cash subsidy.

The departments responded to the following questions:

My employer offers employees cash to reimburse the purchase of an individual market policy. Does this arrangement comply with the market reforms?
My employer offers employees with high-claims risk a choice between enrollment in its standard group health plan or cash. Does this comply with the market reforms?
A vendor markets a product to employers claiming that employers can cancel their group policies, set up a Code section 105 reimbursement plan that works with health insurance brokers or agents to help employees select individual insurance policies, and allow eligible employees to access the premium tax credits for Exchange coverage. Is this permissible?

The FAQs, Affordable Care Act Implementation Part XXII, are available here.