What Health Plans Does USERRA Cover?
USERRA defines a health plan as “an insurance policy, insurance contract, medical or hospital service agreement, membership or subscription contract, or arrangement under which health services for individuals are provided or the expenses of such services are paid.” USERRA applies to group health plans as defined under the Employee Retirement Income Security Act of 1974 (ERISA) in addition to plans not subject to ERISA, such as those sponsored by state or local governments. Health care flexible spending arrangements (FSAs) of cafeteria plans under Section 125 of the Internal Revenue Code qualify as health plans under USERRA, as clarified in the preamble to the final regulations. As such, these plans must also comply with USERRA’s continuation coverage and reinstatement provisions. Accordingly, employees on a military leave of absence who are receiving some form of continued pay from their employer while absent can make pre-tax contributions to the health care FSA. If they are not receiv
