A Qualified Small Employer Health Reimbursement Arrangement (QSEHRA) allows Florida businesses with fewer than 50 full-time equivalent employees to reimburse workers tax-free for individual health insurance premiums and qualifying medical expenses — without sponsoring a group health plan. QSEHRAs are simpler than ICHRAs, have IRS-set contribution limits, and allow employees to maintain their own ACA marketplace plans while receiving some employer contribution toward the cost.
| Coverage Type | Annual Limit | Monthly Equivalent |
|---|---|---|
| Individual-only coverage | $6,350/year | $529/month |
| Family coverage | $12,800/year | $1,067/month |
Employees who receive QSEHRA reimbursements and also purchase marketplace coverage must reduce their ACA premium tax credit by the QSEHRA amount. The employee reports the QSEHRA benefit to the marketplace when applying for coverage. This means lower-income employees who rely on marketplace subsidies may receive less overall benefit from a QSEHRA than higher-income employees who receive no ACA subsidy.
Yes — QSEHRAs can reimburse any "qualified medical expense" under IRS Section 213(d), which includes dental insurance premiums, vision insurance premiums, and a broad range of out-of-pocket medical costs. The employee just needs to submit documentation (receipts or premium statements) to the employer or QSEHRA administrator.
Yes — QSEHRAs require a written plan document and an annual written notice to employees (due at least 90 days before the plan year starts, or 90 days before the employee's coverage start date for new hires). QSEHRA administration platforms (PeopleKeep, Take Command, etc.) provide compliant plan documents and automate the notice process.
Unlike FSAs, QSEHRAs do not have a "use it or lose it" rule at the employee level — unused employer-designated amounts simply expire (the employer keeps the funds). However, there is no carryover of unused QSEHRA allowance to the next plan year unless the employer explicitly allows it in the plan document. Employees do not have their own accounts — the QSEHRA is employer-funded and employer-controlled.
Talk to a licensed broker about which approach fits your employee count and budget.
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