With the cost of group health insurance on the rise, employers are facing enormous cost challenges and are seeking more cost-effective alternatives to group health insurance. The emerging solution is premium reimbursement for individual health insurance.
With a compliant premium reimbursement plan, employers can reimburse their employees tax-free for individual health insurance premiums. The IRS requires that a formal premium reimbursement plan (with IRS-compliant plan documents) be established in order for an employer to reimburse employees for their individual health insurance premiums tax-free.
In this new Zane Benefits Whiteboard Session, JD Cleary outlines how employers can reimburse employees tax-free for individual health insurance, while keeping the business and employees in compliance.
For reference, here's a snapshot of this week's whiteboard: