Guaranty Association Benefits Company: 2-Minute Guide medical expenses benefit plans

2-Minute Guide medical expenses benefit plans

2-Minute Guide medical expenses benefit plans -

Medical Expense Benefit Plans schemes benefits medical costs offer employers a way to help employees with medical expenses and health insurance. Popular among small employers, medical costs for benefit plans offer employers affordable and feasible way of providing employee health benefits.

To help business owners wrap their head around how this type of benefit plan works, this article provides a two-minute guide to Benefits social medical costs

what is a medical expense benefits plan?

a benefit plan for medical expenses is a general term for a system of health benefits that provides employees with money tax-free for out-of-pocket medical costs, including, in some cases, individual health insurance premiums.

Common types of medical expenses benefit plans

There are several types of plans available. The most common type of benefit plans for medical expenses include:

Health Reimbursement Plans (HRPS)
health reimbursement arrangements (HRA)
health savings accounts (HSA)
health flexible spending accounts (FSA)

health reimbursement Plans (HRPS)

health reimbursement plans, or HRPS are benefit plans that allow a non-taxable reimbursement of health insurance premiums and preventive care. With HRPS:

All contributions must come from the employer (employees can not contribute)
the employer owns the funds and pre-financing bank accounts of third parties are not necessary.
There are no minimum or maximum contribution.

HRPS are often the basis of repayment of the premium or contribution "pure" defined health benefits models.

learn more about HRPS.

arrangements reimbursement Health (CRH)

health arrangements refund (aka health reimbursement accounts or CRH) are schemes that allow a non-taxable reimbursement of medical expenses out of pocket, and in some cases, Medicare premiums. With CRH:

All contributions must come from the employer (employees can not contribute)
the employer owns the funds and pre-financing bank accounts of third parties are not necessary.
There are no minimum or maximum contribution.

a common practice is to pair an HRA with a high-deductible health insurance plan to reimburse employees for deductible expenses.

In limited situations, CRH can be offered as a benefit to the independent health used to reimburse employees eligible individual health insurance premiums and / or medical costs outside the poached.

Identify the right plan for your business

to help determine what type of benefit plan is right for your business and employees account for these different characteristics:

may contribute
Cost employer contributions
maximum annual contributions
allowed medical expenses
tax treatment
employee eligibility criteria
Requirement (if any) have some type of health insurance plan
Rollover funds
requirements administration / management
Portability
accounts Requirement (if applicable) to pre-fund

for a side-by- side comparison download this PDF graphic.

Conclusion

benefit plans for medical expenses such as HRPS, HRA, HSA and FSA offer small employers a way offer health benefits with or without a traditional health insurance plan. What type of benefit plan is right for your business? First, understand how each medical expense benefit plans are working. Next, determine what type of diet will help you achieve your health benefits objectives.

What questions do you have on benefit plans for medical or how small employers use them? Leave a comment or question below.

Understanding HSA vs. HRA vs. HRP vs. FSA