As you probably know first-hand, most veterinarians operate in a small clinic setting that isn't able to offer ordinary group health insurance plans due to the smaller number of employees and the giant costs associated with traditional group plans. To be able to offer your staff health insurance, a Qualified Small Employer Health Reimbursement (QSEHRA) could be the best option.
Here's what to know.
What is a small business HRA (QSEHRA)?
QSEHRAs offer small business the chance to help their staff pay for their individual health insurance. HRAs are accounts funded by employers — at an amount determined by your company — for employees, to distribute pre-tax dollars to employees to pay for certain medical expenses.They are not group health plans and aren’t subject to ACA coverage requirements or to income or employment taxes.
Why is a small business HRA beneficial for health insurance for veterinarians?
Gives you a competitive edge: Offering health insurance automatically makes you more competitive in the job market and studies have shown that good benefits improve job satisfaction and company morale.
Customizable: By offering a QSEHRA, employers get to choose a health insurance plan that best suits their needs and still get reimbursed for a good portion of their premiums and other expenses. They can choose to be on their spouse’s plan, pick an insurer that is part of a provider’s plan they like, or stay on their current plan, eliminating the trouble it would take them to choose a new plan.
Predictable costs: With traditional group insurance health plans, companies must deal with changing and unexpected costs. With a QSEHRA, your monthly costs are fixed. You also don’t have to deal with the administrative hassle and manhours it takes to set up a group plan with health insurers.
What items can be reimbursed?
Any medical, dental, and vision expenses are eligible to be reimbursed for employees, their spouses, and their dependents. These expenses include monthly premiums, copays, deductibles, prescriptions, and other healthcare needs. To receive reimbursement, the individual must have been covered by health insurance at the time they incurred the expense. Here's a full list.
What are the costs?
The best part about a QSEHRA is that you can choose a monthly amount that you can afford while reaping the tax benefits. QSEHRAs allow small businesses to give their employees pre-tax dollars to pay for premiums and other medical expenses. A bonus to your staff is that no salary reductions are used to pay for a QSEHRA plan. Each month, you can reimburse your employees up to a specific set amount. You can choose what amount you pay per month towards your QSEHRA plan for your employees, but the annual maximum individual amount is $5,050 and the maximum refund for an employee with family costs is $10,250.
The Take Command Health admin tool has zero setup charges and a small monthly fee, which is a great deal especially compared to the competition.
Does my business qualify?
If you employ fewer than 50 employees and do not currently offer a group healthcare plan, you can participate in the small business HRA program. To find out more about whether you qualify or not, check outthis blog.
Your employees are eligible if they are fulltime, which the program defines as working at least 30 hours a week for at least 120 consecutive days. Your seasonal or part-time employees do not qualify for a reimbursement.
The following individuals may be excluded from your QSEHRA plan:
- Employees who have not completed 90 days of service
- Employees under age 25
- Part-time and seasonal employees
- Union employees (unless the union agreement provides for eligibility)
- Non-resident aliens without income from sources within the United States
Ready to get started?
Setting up a QSEHRA is easy with Take Command Health. We have detailed directions for how to get started as well as a platform that simplifies onboarding, finances and set up easy. Contact us through the link below to find out how we can help you provide your employees with straightforward and high-quality health insurance.