New Health Reimbursement Rules and Employer Tax Credits
This act introduces new rules for employer-provided health reimbursement arrangements, allowing companies to offer specific health plans to employees. Employers can receive tax credits for offering these plans, encouraging their implementation. The changes aim to improve access to health insurance and provide more flexible management of healthcare expenses.
Key points
Employers can offer Custom Health Option and Individual Care Expense (CHOICE) arrangements to employees, covering costs for individual health insurance or Medicare.
Employers offering these plans are eligible for a tax credit of $100 per employee per month in the first year and $50 in the second year.
These arrangements must meet specific requirements, including non-discrimination, verification of employee coverage, and notice obligations regarding rights and responsibilities.
Employees participating in CHOICE arrangements will be eligible to purchase Exchange insurance through cafeteria plans.
The changes will apply to plan years and taxable years beginning after December 31, 2025.
Introduced
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