On Friday, September 13, 2013, the IRS released Notice 2013-54 and the DOL issued Technical Release 2013-03 in substantially identical form.  This guidance, which is generally effective January 1, 2014, provides much needed clarification on the application of certain provisions of the Patient Protection and Affordable Care Act (“ACA”) (annual limits and preventive care) to account-based plans such as HRAs and FSAs, and other types of arrangements that reimburse premiums (referred to in the guidance as “Employer Payment Plans”). 

The guidance indicates that the agencies are generally viewing HRAs, FSAs, and Employer Payment Plans as group health plans for purposes of ACA.  This means that these arrangements will qualify as “minimum essential coverage” for covered employees (i.e., they will preclude employees from receiving a premium credit), unless they are “excepted benefits” under HIPAA.  This also means that these arrangements will need to comply with ACA’s annual dollar limit prohibition and preventive care requirements, unless they are integrated with a compliant group health plan (or are excepted benefits).