A practical guide for small employers
QSEHRA (pronounced “Q-Sarah” for fun) is a new, more efficient way for small businesses and non-profits to offer health insurance to their employees. It’s a game-changer that many are just now discovering.
To cut quickly through the insurance jargon (it stands for “Qualified Small Employer Health Reimbursement Arrangement” by the way), a QSEHRA allows small employers to set aside a fixed amount of money each month that employees can use to purchase individual health insurance or use on medical expenses, tax-free. This means employers get to offer benefits in a tax-efficient manner without the hassle or headache of administering a traditional group plan and employees can choose the plan they want.
Quick summary: Employees pay for health expenses, you reimburse them tax-free
The mechanics of a QSEHRA are surprisingly simple. At a high-level, employees pay for their own health expenses and you reimburse them. Here’s how it works:
- Employers design their plan and set reimbursement allowances
- Employees pay for their own health insurance and medical bills
- Employees provide proof of their expenses
- Employers reimburse the employee up to the set limit
The key to note is payments are reimbursements. Employees will pay the insurance company or doctor’s office directly and then submit a claim to get reimbursed for their expenses tax-free.
Please call us if you have any questions or for help working with and navigating the 2018-2019 healthcare marketplace.
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This is a republished excerpt. Read more here at the article’s original source: https://www.takecommandhealth.com/qsehra-guide