The Qualified Small Employer HRA allows small businesses to reimburse their employees for health premiums and qualified medical expenses. QSEHRA is available to companies with under 50 full-time equivalent employees and it has its limits when it comes to monthly reimbursement rates. If you are wondering “What is the 2022 QSEHRA reimbursement maximum”, you're in luck! The IRS just released those numbers, so let's get right to it!
A quick QSEHRA recap:
With the QSEHRA, the overall idea is that this: employers simply reimburse employees when a health expense occurs. There is no pre-funding of accounts. If employees don’t submit receipts for reimbursement or do not need health care, the leftover funds remain in the employer’s pocket.
Here's how it works:
- Employers design their plan and hang reimbursement allowances
- Employees purchase their own health insurance and medical bills
- Employees provide evidence of their expenses
- Employers reimburse the employee as much as the set limit
What may be the 2022 QSEHRA reimbursement maximum?
- Individual $5,450 or ($454.16/month)
- Family $11,050 or ($920.83/month)
In the law, these amounts are associated with inflation, and we have seen them increase a bit every year.
2022
- Individual $5,300 or ($441.67/month)
- Family $10,700 or ($891.67/month)
2022
- Individual $5250 or ($437.50/month)
- Family $10,600 or ($883.33/month)
All QSEHRA reimbursements are subject to annual maximums and be available to employees monthly. This means employees can't take the full annual amount in January-instead, the funds become open to employees every month.
Another HRA option
For some businesses, depending on local market factors as well as their company makeup, monthly QSEHRA limits work ideal for their employees so that you can choose a quality MEC plan. For some employers, however, they want to offer more than the QSEHRA contribution limit.
There is an alternative HRA option which doesn't have a contribution limit. The individual coverage HRA, or ICHRA, could be regarded as a “super charged” form of the QSEHRA.
It’s worth checking out if the limits are a concern. Again, what’s best for one business isn’t necessarily the very best for an additional. Our team is available to assist show you through this decision!
Take Command might help answer your HRA questions!
While there are many differences, the main contrast when comparing QSEHRA vs. ICHRA is eligibility based on company size and style flexibility. We of experts are waiting to answer the questions you have about these HRAs. In the meantime, you should check out our comprehensive QSEHRA and ICHRA guides.
