Insurer Seeks More Guidance on Health Plan Market Reform

We thank the Department of the Treasury (Department) and Internal Revenue Service (IRS) for the opportunity to provide comments on Notice 2015-87.

Cigna Corporation, together with its subsidiaries (either individually or collectively referred to as "Cigna'*), is a global health services organization dedicated to helping people improve their health, well-being and sense of security by being a major provider of medical, dental, disability, life and accident insurance and related products and services, Worldwide, we offer peace of mind and a sense of security to our customers seeking protection for themselves and their families at critical points in their lives. We have developed a unique approach to health care coverage for beneficiaries and have a deep understanding of the needs and challenges facing both patients and physicians.

We remain dedicated to implementing the Affordable Care Act (ACA) as part of our commitment to expanding access to a breadth of quality, affordable health care options for ail individuals. As a leading provider of health insurance services, Cigna has a keen interest in continuing to shape the implementation of the ACA and, therefore, we are pleased to provide the following comments on Notice 2015-87.

Part II, Sub-Part A -- Further guidance on the application of the guidance under Notice 2013-54 to HRAs

In Question 1, the Department indicates that a health reimbursement account (HRA) that covers fewer than two participants who are current employees (such as one covering only retirees or other former employees) is not subject to the market reforms. The Department stated this included a retiree-only HRA under which available amounts are determined in whole or in part by amounts credited during the period that the individual was a current employee covered by an HRA integrated with another group health plan. We would like clarification regarding whether the participant would be eligible for the premium tax credit in the case of a retiree HRA that only covers vision and/or dental services.

In Question 4, regarding circumstances under which an HRA may be integrated with a group health plan, the Department states an HRA is permitted to he integrated with the employer's other group health plan coverage for purposes of the application of the group market reforms only as to the individuals who are enrolled in both the HRA and the employer's other group health plan. If the spouse and/or dependents are not enrolled in the employer's group health plan coverage, the coverage of these individuals under the HRA cannot be integrated with the coverage under the employer's group health plan, and the HRA coverage generally would fail to meet the group market reforms.

We seek guidance on how to reconcile this rule with previous HRA integration guidance (Technical release No. 2013-03, Application of Market Reform and other Provisions of the Affordable Care Act to HRAs, Health FSAs, and Certain other Employer Healthcare Arrangements) issued in September 2013, which said under the "Integration Method: Minimum Value Not Required," an HRA is integrated with another group health plan for purposes of the annual dollar limit prohibition and the preventive services requirements if ". . . (3) the HRA is available only to employees who are enrolled in non-HRA group coverage, regardless of whether the employer sponsors the non-HRA group coverage (for example, the HRA may be offered only to employees who do not enroll in the employer's group health plan but are enrolled in other non-HRA group coverage, such as a plan maintained by the employer of the employee's spouse); . . .'"

This was addressed again in "Integration Method: Minimum Value Required" where alternatively, an HRA that is not limited with respect to reimbursements as required under the integration method expressed above is integrated with a group health plan for purposes of the annual dollar limit prohibition and the preventive services requirements if ". . . (3) the HRA is available only to employees who are actually enrolled in non-HRA MV group coverage, regardless of whether the employer sponsors the non-HRA MV group coverage (for example, the HRA may be offered only to employees who do not enroll in the employer's group health plan but are enrolled in other non-HRA MV group coverage, such as a plan maintained by an employer of the employee's spouse); . . ."

Finally, 2013-03 stated:

Part II, Sub-Part B -- Further guidance on the application of the guidance under Notice 2013-54 to other arrangements

In Question 5, the Department states an HRA or employer payment plan and the excepted benefits individual market coverage for which the arrangement pays arc not subject to the annual dollar limit prohibition or the preventive services requirements and therefore do not fail to satisfy those market reforms. We seek clarification on whether an employer payment plan that meets this rule will still enable an individual covered under such a plan to receive a premium tax credit.

Part III -- Additional miscellaneous guidance on affordability of employer-sponsored health coverage

With respect to Question 7, we believe the requirement for an HRA to cover group health premiums may contradict the IRS rule that the HRA cannot be used to pay group health premiums. We seek clarification and would recommend not allowing group health premiums to be covered out of the HRA; however, the HRA should still be counted in the calculation to determine if coverage is affordable.

Part IV -- Government entities, health savings accounts, and benefits administered by the Department of Veterans Affairs

We support individuals receiving medical benefits from the Department of Veterans Affairs (VA) not being disallowed from making health savings account contributions if the medical benefits consist solely of disregarded coverage, preventive care, or hospital care or medical services under any law administered by the Secretary of VA for service-connected disability.

Part V -- Application of COBRA continuation coverage rules and health FSA carryovers as permitted by Notice 2013-71

We do not support limiting the ability to carryover unused health flexible spending account (FSA) amounts to a maximum time period. Not only will this be an administrative challenge, but we anticipate it will be difficult for employees to understand that amounts carryover for only one year and are then subject to forfeiture the following year. This will create confusion for employees who elect to contribute to a FSA and will undermine the benefit of the carryover feature.

Thank you for your consideration of these comments.