PeopleKeep has released its third annual usage report on the qualified small employer health reimbursement arrangement (QSEHRA) benefit. The report highlights key findings and insights into how small businesses used the benefit in 2019.
The QSEHRA is a specific type of health reimbursement arrangement (HRA), designed as an alternative to group health insurance for small businesses in the United States with fewer than 50 full-time employees. This year’s report provides year-over-year comparisons, which hint at trends for health benefit budgeting in addition to state-specific trends and statistics.
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“It’s gratifying to see employers allocate HRA allowances that make a difference for their people,” said Victoria Hodgkins, CEO at PeopleKeep. “In the case of organizations with 1-9 employees, the average allowance is $452 per month for a family. In turn, employees are using their tax free allowance for a wide range of health care expenses tailored to their individual needs. While more than half of the HRA users submitted a receipt for a medical office visit, our documentation review team verified more than 154 different categories of expenses in 2019. This is something that makes health care work for everyone and that speaks well to our mission at PeopleKeep.”
Key findings include:
- The average allowance amount for an individual employee is $280 per month or 64 percent of the monthly maximum allowed. Average allowance varies for employees with families and by size of employer.
- The most common out-of-pocket expenses include prescription drugs, medical office visits, chiropractic care, dental care, and mental health counseling.
As group health insurance rates continue to rise, and qualified job applicants become increasingly scarce, a competitive health benefits package is necessary to attract and retain talented individuals. PeopleKeep encourages small business and organization leaders to review the full report to make more informed budgeting and employee-retention decisions.
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