Final Rule Exempts ICHRAs and Account-Based Plans from Medicare Part D Notice
Summary
HHS published a final rule on April 6, 2026, formally excluding account-based group health plans from the Medicare Part D-creditable coverage notice requirement. The exclusion applies to individual coverage health reimbursement arrangements (ICHRAs), traditional HRAs, health care FSAs, HSAs, and other account-based plans. The rule, effective for coverage beginning January 1, 2027, adopts the November 2025 proposed rule without modification. HHS stated that requiring these plans to disclose creditable coverage status imposed an undue administrative burden and that dual messaging created confusing information for Part D-eligible individuals.
What changed
HHS finalized a policy excluding account-based group health plans from sending Medicare Part D-creditable coverage notices to Part D-eligible individuals. The rule applies to coverage periods beginning January 1, 2027, covering ICHRAs, traditional HRAs, health care FSAs, HSAs, and similar account-based arrangements.
Employers and plan administrators offering these account-based plans should update their annual compliance procedures to remove the Medicare Part D notice requirement for affected coverage years. Third-party ICHRA vendors and benefits administrators may also streamline their enrollment and disclosure workflows accordingly.
Archived snapshot
Apr 21, 2026GovPing captured this document from the original source. If the source has since changed or been removed, this is the text as it existed at that time.
April 21, 2026
Final Rule Exempts ICHRAs and Other Account-Based Plans from Medicare Part D-Creditable Coverage Notice
Hannah Demsien, Iris Grossman, Nick Welle Foley & Lardner LLP + Follow Contact LinkedIn Facebook X ;) Embed
On April 6, 2026, the Department of Health and Human Services (HHS) published a final rule formally excluding account-based group health plans from the requirement to provide a Medicare Part D-creditable coverage notice to Part D-eligible individuals. This exclusion applies to individual coverage health reimbursement arrangements (ICHRAs), traditional health reimbursement arrangements (HRAs), health care flexible spending accounts (FSAs), health savings accounts (HSAs), and other account-based group health plans. The final rule, which applies to coverage beginning on January 1, 2027, adopts the November 2025 proposed rule without modification.
In its final rule, HHS acknowledged that requiring account-based plans to disclose creditable coverage status imposes an undue administrative burden on these entities, and that dual messaging — where an HRA indicates it does not offer creditable coverage while the individual’s underlying health insurance plan indicates that it does — creates potentially contradictory and confusing information for Part D-eligible individuals. Most commenters supported the exclusion, and HHS finalized the policy as proposed.
As discussed in our earlier alert regarding the proposed rule, Foley has been involved in advocacy efforts for this change and other simplified reporting for ICHRAs. We view this as a significant win for the industry and an indication that regulators may be open to easing other technical requirements that are ill-suited to the ICHRA framework.
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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.
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