Let's talk health benefits for employees.
We have 4 employees >30 hours a week and 4 part time staff. We'd like to extend a health care stipend, and it looked like a QSEHRA was the best way to do it. It lets us extend the same amount (i.e. $200 a month) to every employee to reimburse for any medical costs, including premiums. We also can offer more to employees who are older or have dependents (and therefore pay higher premiums) under the law.
It doesn't need to be pre-funded and doesn't require a separate account, or costly administration. And unlike a non HRA-"stipend", it's tax-free on both sides.
HOWEVER. It reduces the amount of subsidy folks on the health care exchanges get. Because we pay wages that are in line with our industry (not a well paid one), most staff that have health insurance through the exchange qualify for a subsidy of between $70-$250 per month. If we offer this HRA, even if they don't take the reimbursement, their monthly federal subsidy is reduced by the amount of the HRA stipend.
Does anyone have a better solution? We really want to offer staff health benefits of some sort. But a HSA or FSA doesn't cover premiums, and ICHRA doesn't allow for people on partner's/parent plans or Medicaid. Just raising their wages will raise their taxes.
(We don't want to do a group insurance plan, as we don't have any better negotiating power than staff do on an individual level and all staff get health insurance currently through a partner, the exchange, Medicaid, or a parent (for the under 26's).)
We have 4 employees >30 hours a week and 4 part time staff. We'd like to extend a health care stipend, and it looked like a QSEHRA was the best way to do it. It lets us extend the same amount (i.e. $200 a month) to every employee to reimburse for any medical costs, including premiums. We also can offer more to employees who are older or have dependents (and therefore pay higher premiums) under the law.
It doesn't need to be pre-funded and doesn't require a separate account, or costly administration. And unlike a non HRA-"stipend", it's tax-free on both sides.
HOWEVER. It reduces the amount of subsidy folks on the health care exchanges get. Because we pay wages that are in line with our industry (not a well paid one), most staff that have health insurance through the exchange qualify for a subsidy of between $70-$250 per month. If we offer this HRA, even if they don't take the reimbursement, their monthly federal subsidy is reduced by the amount of the HRA stipend.
Does anyone have a better solution? We really want to offer staff health benefits of some sort. But a HSA or FSA doesn't cover premiums, and ICHRA doesn't allow for people on partner's/parent plans or Medicaid. Just raising their wages will raise their taxes.
(We don't want to do a group insurance plan, as we don't have any better negotiating power than staff do on an individual level and all staff get health insurance currently through a partner, the exchange, Medicaid, or a parent (for the under 26's).)
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