§9831 General Exceptions

Summary

Certain group health rules do not apply to some plans and some benefits. Government plans are not covered by these rules. A group health plan is also not covered for a plan year if it has fewer than 2 current employee participants on the first day of that year (except as to a rule in another part of the law). The rules also do not apply when a plan only offers certain small types of benefits described elsewhere in the law. Some of these excepted benefits are not covered only if they are sold under a separate insurance policy or are not an important part of the main plan. A few kinds of excepted benefits are allowed only if they are under a separate policy, do not coordinate with the employer’s other plans, and pay for an event even if another plan also pays. Supplemental excepted benefits are excluded if they are under a separate policy. A qualified small employer health reimbursement arrangement (QSEHRA) is not treated as a group health plan. To be a QSEHRA it must be paid only by a small employer, have no employee salary reductions, be offered on the same terms to all eligible employees, and reimburse medical care costs after the employee shows proof of other coverage. The yearly limits are $4,950 for one person or $10,000 if family members are covered. Limits are prorated if someone is not covered the whole year and are increased for inflation for years after 2016, rounded down to the nearest $50. An eligible employer must not be a large employer and must not offer any group health plan. Employers must give each eligible employee a written notice at least 90 days before the plan year (or when the employee first becomes eligible) saying the employee’s benefit amount, telling the employee to give that amount to an insurance exchange if seeking a premium tax credit, and warning about possible taxes if the employee lacks minimum coverage.