Get your copy of PeopleKeep's 2024 QSEHRA Report
The QSEHRA empowers small businesses and nonprofits to offer affordable, flexible health benefits
Since its launch in 2017, the qualified small employer health reimbursement arrangement (QSEHRA) has made it possible for more small employers to offer a health benefit by enabling them to reimburse their employees tax-free for their health insurance premiums and qualifying out-of-pocket medical expenses.
Data from KFF's 2023 Employer Health Benefits Annual Survey found that only 39% of organizations with three to nine employees and 67% of organizations with 10-199 workers offer health benefits. However, almost 100% of larger organizations offered a health benefit in 2023. With a QSEHRA, small businesses and nonprofits can provide their employees with a meaningful, cost-effective benefit that helps with recruitment and retention.
Our customer data and survey prove that the QSEHRA empowers small employers to offer health benefits and maintain complete cost control.
Fill out the form to read the full report to see how today's employers are using their QSEHRA.
Download the complete report
Our seventh annual usage report on the qualified small employer health reimbursement arrangement (QSEHRA) is here!
As the first organization to offer a cloud-based QSEHRA administration platform, PeopleKeep has reported on how employers use their benefits annually since the launch of the benefit in 2017. This year’s report details how thousands of small businesses and nonprofits across the U.S. used and designed their QSEHRA benefit in 2023.
The 2024 edition includes data on:
- The average monthly QSEHRA allowance
- The average monthly allowance by family status
- The average monthly allowance by company size
- The average monthly allowance by benefit design
- The average monthly allowance by company tenure with PeopleKeep
- The use of voluntary features such as waiting periods and employer-sponsored premium reimbursement (ESPR)
- QSEHRA and health savings account (HSA) coordination
- The average age of employees with a QSEHRA
- The most popular states for PeopleKeep QSEHRA customers
- The average percentage of an employee's allowance that gets used
- The most commonly reimbursed expenses
- The top reimbursed insurance carriers and their average premium reimbursement amount
- The average monthly reimbursements among employees who submitted expenses
- Results of our 2024 QSEHRA customer survey, including the share of employers offering a QSEHRA as a first-time benefit, why our customers chose a QSEHRA, and the share of customers by industry.
Average monthly QSEHRA allowances continue to rise
Over the past seven years, one trend that’s continued to hold true is a year-over-year increase in the average allowance employers offer to their employees. In 2023, organizations offered an average monthly allowance of $431. This is a 4.6% increase from 2022.
One possible explanation for monthly allowances increases annually is that the IRS increases the maximum contribution limits each year. Between 2022 and 2023, the maximum allowance an employer could offer single employees and employees with a family increased by 7.3% and 6.8%, respectively. The IRS-imposed maximum limits for 2023 were $5,850 (or $487.50 monthly) for single employees and $11,800 (or $983.33 monthly) for employees with families.
Insurance premiums remain the most popular reimbursed expense
Roughly 42% of all reimbursements from PeopleKeep QSEHRA users in 2023 were for premiums, which had an average reimbursement amount of $249. This includes dental and vision insurance premiums. The remaining 58% of reimbursements were for qualifying out-of-pocket medical costs.
Nearly 77% of employers surveyed didn't offer a health benefit before the QSEHRA
As part of the report, we surveyed a segment of our QSEHRA customers to highlight why small businesses and nonprofits chose a QSEHRA instead of other types of health benefits.
Our survey found that if not for the QSEHRA, many employees would likely go without health benefits. Nearly 77% of employers surveyed said they didn't offer a health benefit to their employees before offering the QSEHRA through PeopleKeep.
A sneak peek at our key findings
Smaller organizations offer higher QSEHRA allowances, on average
Over the last year, organizations employing between one and four employees offered roughly 2.8% more than the largest organizations with 20 to 49 employees.
Prescription drugs are popular out-of-pocket expenses
Prescription drugs were the most commonly reimbursed non-premium expenses among PeopleKeep QSEHRA customers.
More employers offer premium-plus accounts than premium-only
Roughly 95% of employers offer a premium-plus account that allows employers to reimburse employees for insurance premiums plus more than 200 out-of-pocket expenses.
Learn more about PeopleKeep
What is PeopleKeep?
PeopleKeep is a personalized benefits administration software company. We serve small and midsize employers across many industries ranging from nonprofits, to high tech, to engineering. Because our software is intuitive and can be managed in minutes per month, we make providing benefits more accessible to organizations that do not want to manage complex and tedious administrative tasks.
Since starting as Zane Benefits in 2006, we've been the leader in cloud-based personalized benefits administration.
What other reports has PeopleKeep published?
As the industry leader in HRAs and personalized benefits, PeopleKeep prides itself on publishing proprietary data on all things HRAs and employee benefits.
PeopleKeep released three reports on the employee benefits employees value most, surveying more than 900 employees of small and midsize employers.
We also release annual reports on the QSEHRA and the individual coverage HRA (ICHRA).
What products does PeopleKeep offer?
We provide software that allows organizations to offer health reimbursement arrangements (HRAs) and employee stipends. Learn more about each of our products below:
- Qualified small employer HRA (QSEHRA): A simple, controlled-cost alternative to group health insurance for employers with 1-49 employees.
- Individual coverage HRA (ICHRA): A flexible health benefit solution for employers of all sizes that can be used alone or alongside group health insurance.
- Group coverage HRA (GCHRA): A group health supplement for employers already offering a group health insurance plan to help employees with out-of-pocket expenses.
- WorkPerks: Reimbursable employee stipends that broaden employee benefits. Offer your employees benefits for health, wellness, remote work, education, transportation, and more.
How much does a plan with PeopleKeep cost?
At PeopleKeep, we help you implement budget-friendly, compliant benefits without the hassle. Pricing will vary depending on which product you're interested in and how many employees you'll have enrolled in the benefit.