Welcome to the Agent and Broker Video Learning Center.
In this video, the term "Marketplace" refers to Federally-facilitated Marketplaces, or
FFMs, including FFMs where states perform plan management functions, and State-based
Marketplaces on the Federal Platform, or SBM-FPs.
This video will provide additional information on Health Reimbursement Arrangements, also
known as HRAs, and do a walkthrough of the HRA Employee Affordability Tool.
Specifically, this tool looks at individual coverage HRAs and Qualified Small Employer
HRAs, or QSEHRAs.
This tool can assist applicants who have received an offer of an individual coverage HRA from
their employer or who have been provided a QSHERA from their employer with estimating
if their HRA offer may be affordable or unaffordable, and it also recommends next steps for the
consumer.
This tool can be accessed by visiting HealthCare.gov’s job-based health page, linked above and in
the video description.
This first scenario features Tom, who uses the HRA Employee Affordability Tool.
Based on the information he enters in the tool, it is recommended that he accept his
HRA offer.
The first thing Tom sees when navigating to the HRA Employee Affordability Tool are three
key facts about HRAs.
First, he learns an HRA isn’t traditional job-based coverage.
Rather than offering Tom coverage, his employer will reimburse him for qualified medical expenses,
including the cost of the premium for his individual health insurance plan.
Second, he discovers that he must be enrolled in a health plan purchased through the Marketplace
or another source to use the reimbursement from the HRA.
Third, he is advised to fully understand his options before deciding to decline or accept
his HRA offer.
If Tom doesn’t, he could end up paying more for coverage than needed depending on what
he is eligible for through the Marketplace.
Since Tom has never been offered an individual coverage HRA before, he doesn’t understand
what it is, so he decides to use the three-step guide to learn more.
Under the “Get next steps for your HRA notice,” Tom sees that he will need to provide information
regarding his HRA offer from the notice he received from his employer.
Tom makes sure he has his HRA notice available before using the tool.
He gets started by entering his zip code, 48001, and selecting “Get Started.”
In the first step of the tool, Tom is asked to reference his HRA notice to determine which
type of HRA he was offered.
This is either an individual coverage HRA or a Qualified Small Employer HRA, also known
as a QSEHRA.
Tom didn’t know there are different types of HRAs, so he wants to confirm the type
he has.
He selects “More help finding HRA type” to view additional information.
From the information that displays in the help drawer, Tom sees that he should review
the notice from his employer for certain key terms to determine which type of HRA he has
been offered.
Tom sees a statement that there are different kinds of HRAs (including a qualified small
employer health reimbursement arrangement) and the HRA being offered to him is an individual
coverage HRA.
Please note that consumers who are provided a QSEHRA or Qualified Small Employer HRA,
can click on the link below to learn more about entering a QSEHRA in the tool.
If Tom’s notice didn’t have any of these key words, he should reach out to his employer
to learn more before continuing with the tool.
Now that Tom knows he has an individual coverage HRA, he selects “Close” to leave the help
drawer.
Tom selects “individual coverage HRA” and views additional questions about his offer,
including his reimbursement amount as described in his HRA offer, but he isn’t sure which
number to enter here.
He selects the “Can’t find the dollar amount” button to learn more.
The information in the help drawer advises Tom to view his individual coverage HRA notice
to identify his self-only reimbursement amount.
A self-only reimbursement amount is the maximum dollar amount the employer will contribute
to an employee’s HRA for the employee only.
Tom should use this amount, even if his HRA offer extends to family members, and even
if his employer provides an additional amount for dependents.
Tom checks his notice in the basic terms section, looks for the phrase “self-only maximum
dollar amount available,” and sees $200 in his notice.
His notice states that he is reimbursed on a monthly basis, so the dollar amount he sees
is the amount available to him each month.
The help drawer also mentions that some notices may include an annual amount instead.
Please note, Tom should enter the self-only amount for his age bracket at this step in
the tool.
Tom is 30 years old, so he will enter his monthly amount of $200 that is associated
with his age bracket.
Tom is single and claims no dependents, but if he did, he would still enter the self-only
amount in the tool.
Now that Tom has the information he needs from his notice, he selects “Close” to
leave the help drawer.
Tom now enters $200 as the amount and selects “Monthly” as the frequency included in
his notice.
Then he selects “Continue” to go to Step 2 of the tool.
In Step 2, Tom is asked to enter his household’s expected yearly income, even for members of
his household that are not eligible for the individual coverage HRA.
Tom isn’t sure what to include here, so he selects “Learn what to include in your
estimate” to see additional information on expected income.
Once in the help drawer, Tom sees that he should include all income before taxes.
He only has one source of income from his job at ABC Corp. of $52,000 a year.
He also does not have any other household members so that is the only income he will
need to enter in the tool.
It is important for Tom to do his best to accurately estimate his household income because
it will be used to determine whether he may be eligible for savings on a Marketplace plan
called a “premium tax credit” or whether he should use his HRA instead.
Now that Tom has learned more about how to estimate his income and why it’s important,
he selects “Close” to leave the help drawer.
To learn more about calculating income, see our Income Calculation Tool video linked above
or in the description below.
Tom enters his estimated yearly income of $52,000 and 30 as his age.
He then selects “Get my results” to continue to Step 3 of the tool.
In Step 3, the tool gives Tom his results based on the information he entered about
his household situation and HRA offer.
He learns that accepting his HRA offer is likely a good idea.
He still doesn’t fully understand why accepting his offer is the recommended next step, so
he selects “Learn more about my results” to see more details.
Tom learns that it is likely a good idea for him to accept his HRA offer because he will
most likely not qualify for savings with the Marketplace based on the information he entered.
Please note, the HRA Employee Affordability Tool is only able to provide an estimate based
on the information included in the previous steps, so there is still a possibility that
Tom could qualify for savings, Medicaid, or CHIP.
The only way to know for sure is for Tom to complete an application on HealthCare.gov
and include information about his HRA.
Please note, if Tom applies for coverage through the Marketplace and attests that he has been
recently offered an individual coverage HRA, he may also qualify for a special enrollment
period based on having been newly offered the individual coverage HRA.
Now that Tom understands his results in more detail, he selects “Close” to leave the
help drawer.
Based on Tom’s results, his recommended next steps are to confirm whether he qualifies
for savings on coverage through the Marketplace or for free or low-cost coverage through Medicaid
or CHIP by selecting the Start Marketplace application button.
After he completes his application, and views his eligibility results, Tom will know for
sure whether he should accept his HRA or whether he is eligible for savings, such as tax credits,
through the Marketplace that he could use instead because he can’t use both his HRA
and a tax credit.
If his eligibility results match the expected outcome from the HRA Employee Affordability
Tool and he does not qualify for savings, Medicaid, or CHIP, then he can enroll in a
Marketplace plan or a health insurance plan from outside of the Marketplace, including
directly through a health insurance company.
He will then be able to use his individual coverage HRA for qualifying medical expenses,
including the monthly premiums for that plan.
Tom’s employer may allow him to pay for the portion of his premiums that aren’t
covered by his individual coverage HRA by using a salary reduction arrangement on a
pre-tax basis, known as a “cafeteria plan.” If Tom accepts this arrangement, he cannot
use the funds from his salary reduction arrangement to pay for Marketplace coverage.
To use this arrangement, he would need to enroll in coverage outside of the Marketplace
instead.
This doesn’t apply to Tom, so he will need to tell his employer that he is accepting
the HRA and has enrolled in a plan that meets the HRA’s requirements.
Please note that if Tom accepts his HRA offer, then he will generally be ineligible for savings
through the Marketplace, such as the premium tax credit, until the end of his HRA’s plan
year.
At the end of his HRA’s twelve-month plan year, Tom will have another chance to decide
whether he wants to use the HRA or not.
At that time, he can update his Marketplace application to find out whether he may qualify
for a tax credit.
For some people, their HRA plan year will start and end based on the calendar year (January 1–December 31).
For others, their HRA plan year will start and end on a non-calendar year basis—for
example, from July 1 to June 30 of the following year.
Employees hired in the middle of an HRA plan year might have fewer than 12 months until
the end of their HRA’s plan year.
For more information on individual coverage HRAs, please visit the link below:
This second scenario features Amy, who uses the HRA Employee Affordability Tool.
Based on the information she enters in the tool, it is recommended that she decline her
HRA offer and use tax credits with Marketplace coverage instead.
In the first step of the tool, Amy is asked to reference her HRA notice to determine which
type of HRA she is offered.
Amy sees the term “individual coverage HRA” used throughout her notice, so she selects
“individual coverage HRA” as her answer option.
Amy then views additional questions about her individual coverage HRA, including about
the amount and frequency of her reimbursement.
Amy references her notice and sees there are amounts for self-only reimbursement in her
age bracket and for “employee plus one,” “employee plus two,” and “employee plus
three.”
Amy should only enter the self-only amount here, even though her HRA can be used by her
other household members.
Amy’s notice states her self-only amount is $1,200 for the year.
She enters that amount, selects “Yearly” as the frequency, and then selects “Continue”
to proceed to Step 2 of the tool.
In the second step of the tool, Amy is asked to enter her expected yearly household income
and her age.
Amy is married and filing jointly with her husband, Kevin.
Amy must enter their combined household income, even if Kevin is not eligible to use the HRA.
Amy currently makes $18,000 a year, and Kevin makes $12,000 per year, so she will enter
$30,000 as their estimated household income.
Amy is 43 years old, so she will enter that as her age, then select “Get my results”
to continue to Step 3 of the tool.
In the third step of the tool, Amy receives her results based on the information she has
entered so far.
Amy is told that declining her individual coverage HRA offer is probably a good idea,
but she doesn’t understand why she received this result.
Amy selects “Learn more about my results” to get more information.
In the help drawer, Amy learns that she may qualify for savings through the Marketplace
or for free or low-cost coverage through Medicaid or CHIP.
If she does qualify for savings, she may be able to save more money on monthly premiums
for herself and her husband with those savings than with her individual coverage HRA offer.
Therefore, her results in the tool recommend that she decline her HRA offer in in order
to use savings from the Marketplace.
However, the only way that Amy can know for sure if she is eligible for savings, Medicaid,
or CHIP is to complete a Marketplace application.
Please note, Amy can’t use both savings from the Marketplace and the individual coverage
HRA.
Amy selects “Close” to leave the help drawer and continue reviewing her recommended
next steps.
Based on Amy’s results, her recommended next steps are to see if her family qualifies
for savings through the Marketplace, Medicaid, or CHIP.
Amy would need to complete an application by selecting the “Start Marketplace application”
button to receive her eligibility results and confirm whether declining her HRA offer
and using savings available through the Marketplace is a better option.
If her family’s eligibility results match the expected outcome from the tool, and she
does qualify for savings, Amy must enroll in a Marketplace plan if she wants to use
those savings to help cover her health insurance premiums, and she must decline (opt out of)
her HRA offer.
Amy could choose to use her HRA instead of a tax credit, but cannot use both, and she
also views a warning message that she will not be able to use both her HRA and savings
from the Marketplace.
After enrolling in a Marketplace plan, Amy will need to tell her employer that she is
declining the HRA.
The third scenario features Molly, who has Qualified Small Employer HRA, also known as
a QSEHRA, and uses the HRA Employee Affordability Tool.
In the first step of the tool, Molly is asked to reference her HRA notice to determine which
type of HRA she has.
Molly’s employer has fewer than 50 employees, and she sees the term “Qualified Small Employer
HRA” used throughout her notice.
Her notice also says that she needs to have minimum essential coverage (MEC) for any month
she receives reimbursements from the HRA.
Please note, individual coverage HRAs can be accepted or declined, but a QSEHRA cannot
be declined.
However, in some cases consumers may be able to use their QSEHRA along with some tax credit
to help pay for Marketplace coverage.
Molly is confident she has been provided a QSEHRA, so she selects that as her HRA type.
Once Molly selects “QSEHRA,” a warning message appears asking Molly to double check
her HRA notice and confirm she’s provided a QSEHRA, rather than an individual coverage
HRA.
If Molly isn’t sure what type of HRA she has from her notice, then she should contact
her employer to learn more.
Molly reviews her notice again and confirms that she has a QSEHRA, so she selects “Continue”
to proceed through the tool.
Molly then views recommended next steps for her QSEHRA.
Molly learns that she can use her QSEHRA to help pay for qualifying health coverage if
she has a health insurance plan from the Marketplace or another source that meets standards for
“minimum essential coverage (MEC),” like coverage from a family member’s employer.
If Molly applies for coverage through the Marketplace and attests that she has been
recently provided a QSEHRA, she may qualify for a special enrollment period based on having
been newly provided a QSEHRA, and she will receive a warning message in her eligibility
results that she will have to manually adjust the amount of Marketplace savings she uses
to avoid having to pay back part of those savings when she files her taxes for the coverage
year.
If Molly decides to enroll in a plan through the Marketplace, and she qualifies for savings
through the Marketplace, also called premium tax credits, then her QSEHRA contribution
could reduce the total amount of Marketplace savings she is eligible for.
Molly should use the worksheet linked on this page to help her determine how much of the
premium tax credit she could use to lower her monthly premium amount.
We hope this video has been helpful.
If you haven’t already, we encourage you to watch our other video for a full walkthrough
of the streamlined HealthCare.gov application where the applicant is seeking financial assistance,
linked to in the video description below.
Additionally, if you would like more information about HRAs, please see the HRA video linked
in the video description below.
If a consumer needs additional support using the HRA Employee Affordability Tool, they
should contact the Marketplace Call Center.