In today’s world, 74% of employees agree that having health insurance benefits provides peace of mind for the unexpected and increases loyalty to their company. They also prefer customized benefit options based on their personal needs. Sounds like there are a lot of good reasons to opt for a QSEHRA (defined contribution model) over a traditional one-size-fits all group benefit plan. But how do you explain this new concept to your employees? Communicate early, often and in writing. Here are a few tips.
Communication is key
The provisions of the 21st Century Cures Act and the rules and requirements surrounding small business HRAs (QSEHRAs) can be hard to understand (and we all know how confusing health insurance is in general!). That’s why lawmakers included very specific requirements on how small business owners communicate to their employees. Just remember, it must be in writing.
Here’s what you are required to communicate:
- How much contribution an employee is eligible for in that given year
- How employees need to communicate their contribution amount to any health insurance exchange to which they apply for advance payment of the premium assistance tax credit.
- Help them understand that if the employee is not covered under minimum essential coverage for any month, the employee may be subject to tax for that month and reimbursements under the arrangement may be includible in gross income.
Did you get the memo?
Explaining the fine points of the QSEHRA early and often will help your employees understand and get the most out of this new benefit. Any of the standard methods of written communication in your company are acceptable, from memos to brochures to emails. As long as you answer the following questions:
- What is an HRA and what is individual health insurance?
- How will your employees find and purchase individual insurance? Beware: federal rules prohibit employers from being involved in the actual choosing of an employee's provider or policy. The good news is Take Command can help them make a smart decision based on their needs.
- If you have an existing group healthcare policy, when will it be cancelled and when will the HRA take effect?
- Why is the company making this switch? What are the benefits for both employer and employees?
Take Command is here to help
Does all of this sound confusing? Not sure where to start? We offer support for you as a business owner as well as your employees. Our small business experts will take care of the details so you can go back to managing your business.
Here's how we can help.
For your employees:
- We offer a data-driven platform to help them pick the best on- or off-exchange plan based on their preferred doctors, unique needs and prescriptions.
- Our customized portal allows them to enroll in the HRA online, view their HRA documents, submit medical expenses (if allowed), access their membership benefits, and upload their proof of coverage for compliance checks
For you (as a business owner):
- We handle all the legal work and make tax season easy and painless
- Employee onboarding
- An easy and quick online signup process
- A customized admin portal for your business allows you to review and approve HRA documents, view monthly reimbursement reports, add/remove employees, manage subscriptions, update payment information, and see overview information about HRAs.
I wrote this blog because I care about ideas (big and little) that can help fix our healthcare system. I used to work on projects for Kaiser Permanente and the Parkland Health & Hospital System so I've seen the system inside and out. It's so important that consumers keep up with industry shifts and changing health insurance regulations. I'm also Take Command Health's Content Editor and a busy mom. Learn more about me and connect with me on our about us page. Thanks!