Did You Know You Can Reimburse Your Employees for Individual Health Insurance?

[scagnt83]

Why wouldn't the employer just offer to fund employees health savings account and avoid all the legal problems?

Because policies that are paid with HSA funds are not eligible for Tax Credits.

Even if they still did it, the contribution would have to be structured as a bonus and the employee would need to have the option to take the bonus in cash or have it go into a HSA or it would be considered a group health plan.

Basically small business owners either need to offer true group health or dont. If they want to help employees out without having group health then give them a bonus in lieu of HI. Or pay for a decent Gap Plan.

 

[tonyisme]

I have the affordable healthcare act signed by POTUS in March 2010 if anybody wants to read it. PDF. Something to do until the next open enrollment period.
2000 pages of incredible amounts of information. It took most carriers 6 months and their legal staff to figure it out
Some maybe didn't figure it out
I started to read it but it's beyond my level of competence

 

[ctg]

Basically small business owners either need to offer true group health or dont. If they want to help employees out without having group health then give them a bonus in lieu of HI. Or pay for a decent Gap Plan.

If they give their employees a bonus, it may bump them into a higher tax bracket or reduce the subsidy if they're eligible. I think many small employers are doing the blackjack dealer hand move as they leave the table and saying "I'm out."

I'm thankful our elected officials really thought through this law before they passed it.

 

[hamben]

Because policies that are paid with HSA funds are not eligible for Tax Credits.

Even if they still did it, the contribution would have to be structured as a bonus and the employee would need to have the option to take the bonus in cash or have it go into a HSA or it would be considered a group health plan.

Basically small business owners either need to offer true group health or dont. If they want to help employees out without having group health then give them a bonus in lieu of HI. Or pay for a decent Gap Plan.

What are you talking about, I'm talking about funding the savings accounts not the policy. You are 100% incorrect . An employer can fully fund the employees savings account and take the tax deduction. The bonus is taxable the hSA contribution is not....

 

[scagnt83]

If they give their employees a bonus, it may bump them into a higher tax bracket or reduce the subsidy if they're eligible. I think many small employers are doing the blackjack dealer hand move as they leave the table and saying "I'm out."

I'm thankful our elected officials really thought through this law before they passed it.

Excellent point... the bonus could be a double edged sword for employees with the tax credits.

I guess that a gap plan might be the safest route... that way the employee could get a lower cost hdhp.

 

[Zane Benefits]

Sounds to me like you don't take the agent community's concerns seriously. . . The discussion wasn't very "humorous"--it voiced realistic concerns about protecting our clients from harm.

Apologies if the tone came off wrong. The "humorous" comment was to the "hit it and quit it" thread. Sorry I didn't clarify that.

Let us know if we can address any specific client or compliance questions. We're here to help.

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Because policies that are paid with HSA funds are not eligible for Tax Credits.

Even if they still did it, the contribution would have to be structured as a bonus and the employee would need to have the option to take the bonus in cash or have it go into a HSA or it would be considered a group health plan.

Basically small business owners either need to offer true group health or dont. If they want to help employees out without having group health then give them a bonus in lieu of HI. Or pay for a decent Gap Plan.

Additionally, one consideration is (in most cases) HSA funds cannot be used for health insurance premiums, and employees must have an HDHP.

I wrote about this topic this week on our blog: FAQ - Can We Use an HSA to Reimburse Employees for Health Insurance?

 

[scagnt83]

Additionally, one consideration is (in most cases) HSA funds cannot be used for health insurance premiums, and employees must have an HDHP.

I wrote about this topic this week on our blog:

nice of you to ignore the post about the DOL notice warning against the scheme you are promoting... and warning against companies like yours...

 

[sman]

nice of you to ignore the post about the DOL notice warning against the scheme you are promoting... and warning against companies like yours...

I particularly liked this comment:

Let us know if we can address any specific client or compliance questions. We're here to help.

How many different questions have been asked and comments made that Zane Benefits hasn't addressed? That would be a good place to start.

 

[DS4]

..... HSA funds cannot be used for health insurance premiums........... [/url]

That is not entirely true, from IRS,

Q-27. Are health insurance premiums qualified medical expenses?
A-27. Generally, health insurance premiums are not qualified medical expenses except for the following: qualified long-term care insurance, COBRA health care continuation coverage, and health care coverage while an individual is receiving unemployment compensation. In addition, for individuals over age 65, premiums for Medicare Part A or B, Medicare HMO, and the employee share of premiums for employer-sponsored health insurance, including premiums for employer-sponsored retiree health insurance can be paid from an HSA. Premiums for Medigap policies are not qualified medical expenses.

 

[Yagents]

What a joke.............for all to see on google searches.

Can opening............meet worms