TREX Health & Welfare Benefit Design 2

Question 1

Under the ACA, what is the penalty for employers that offer coverage but fail to meet minimum value standards?

Accepted Answer

Section 4980H(b) penalty per employee who receives a subsidy

Answer

The 4980H(b) 'B penalty' applies per full-time employee who obtains subsidized Marketplace coverage when the offered plan fails minimum value or affordability.

Question 2

A Health Reimbursement Arrangement (HRA) differs from an HSA primarily because an HRA:

Accepted Answer

Is owned and funded solely by the employer

Answer

HRAs are employer-funded accounts; employees cannot contribute, and unused balances may be forfeited per plan design.

Question 3

Which cost-sharing feature specifically requires the insurer to pay 100% of covered in-network expenses once a participant reaches the limit?

Accepted Answer

Out-of-pocket maximum

Answer

The ACA-mandated out-of-pocket maximum caps total member cost-sharing so the insurer bears all remaining in-network costs for the year.

Question 4

A self-insured employer purchases stop-loss insurance with a $200,000 specific attachment point. This means:

Accepted Answer

The employer pays all claims up to $200,000 per covered individual

Answer

Specific (individual) stop-loss protects the plan from catastrophic single-claimant costs by reimbursing claims above the stated per-person threshold.

Question 5

The Mental Health Parity and Addiction Equity Act (MHPAEA) requires that:

Accepted Answer

Financial and treatment limitations for MH/SUD cannot be more restrictive than those for medical/surgical benefits

Answer

MHPAEA prohibits applying more restrictive quantitative or non-quantitative treatment limitations to mental health/substance use disorder benefits than to analogous medical/surgical benefits.

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TREX Health & Welfare Benefit Design 2