Under the 21st Century Cures Act enacted 12/13/16, certain small employers are allowed to offer Health Reimbursement Arrangements (HRAs) to employees without also offering other health insurance coverage in 2017. The HRA must meet certain requirements and the amount the employer can contribute to the HRA is limited. Additionally, reimbursements to the employee for medical expenses are tax-free only if the employee is enrolled in other health coverage (e.g., individual coverage) that is minimum essential coverage. The HRAs also can affect an employee’s eligibility for a premium tax credit, or the amount of premium tax credit that is available. The new law also provides that small employers who have reimbursed individual health insurance premiums from a standalone HRA before 1/1/17 will not be subject to the Section 4980D penalty.