Which HRAs Must Comply with the SBC Requirement

As with other parts of Health Care Reform, the SBC requirement generally applies to group health plans. Health Reimbursement Arrangements (HRAs) are group health plans. As a result, many HRAs are required to prepare and distribute SBCs. Unless otherwise exempt under the rules described below, the list of HRAs that must comply with the SBC requirements includes:

• Stand-alone HRAs
• HRAs integrated with another group health plan (unless the HRA coverage is adequately described in the SBC distributed by the other group health plan)
• Premium-only HRAs
• Both ERISA and non-ERISA HRA (i.e., HRAs sponsored by governmental employers and churches)

Some HRAs, however, are exempt. HRAs excepted from HIPAA Portability are not subject to the SBC requirements. The list of HRAs excepted from HIPAA Portability and, therefore, not subject to the SBC requirements, includes:

• Limited scope HRAs that reimburse only dental and/or vision expenses
• HRAs that satisfy the following conditions: (1) the maximum annual benefit available under the plan does not exceed $500, and (2) all HRA participants are also eligible for coverage under another group health plan sponsored by the employer that is not an excepted benefit under HIPAA
• Retiree-only HRAs (i.e., HRAs that reimburse only expenses incurred after employment ends)

Important: There is no special treatment for grandfathered health plans. Grandfathered HRAs must comply with the SBC requirements.

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