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Obamacare is expanding in a good way.

Employers will now have more options to provide employees with more customized benefits. Traditionally, Health Reimbursement Accounts, commonly known as HRAs, involve employees being reimbursed by the employer as a way for the employer to pay for certain medical expenses.

However, because of Obamacare expansion, starting January 1, 2020, employers can offer Individual Coverage HRAs (ICHRAs). ICHRAs will allow employers to provide tax-exempt funds to their employees for the purchase of Affordable Care Act (ACA)-compliant coverage.

This rule also allows employers that offer traditional group coverage to offer EBHRAs. EBHRAs will allow employers to reimburse employees up to $1,800 per year (amount set to be indexed annually after 2020) for certain medical expenses. The allowed expenses include stand-alone dental or vision benefits or premiums for STLDI coverage. Employers cannot offer both an ICHRA and EBHRA.

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