Health Insurance Opportunities for Nevada's Small Businesses 

Small business owners have another option for providing health insurance coverage to their employees in Nevada.  It is a very affordable employee benefit option available which can help small businesses attract and retain their employees, while also helping their employees pay for their health care needs. This option is available to those small businesses (have fewer than 50 employees) who have never offered health insurance employee benefits before, or for those small employers who want to change their benefit package.  There is no minimum required employer contributions to be made, so each small business can determine the amounts they can comfortably afford to contribute towards their employees’ benefits. This option also relieves the burden on the small employer in Nevada from administering or overseeing the health benefit plan for their employees while still providing them an avenue to fully insured qualified health plans.  

This option called Qualified Small Employer Health Reimbursement Arrangements (QSEHRAs), allows small employers to provide reimbursement of certain employee health care expenses, such as individual health insurance premiums and coinsurance. The American Rescue Plan Act of 2021 recently became law, and it greatly expanded the federal subsidies that are available to individuals and families that purchase coverage through Nevada’s Silver State Health Insurance Exchange, also known as Nevada Health Link. The combination of the federal health insurance subsidies with employer QSEHRA contributions can make individual health insurance coverage for employees and their families extremely affordable. 

Plan qualifications and maximum contribution amounts are shown below.

To qualify for a QSEHRA, a small employer generally must: 

• Have fewer than 50 full-time employees
• Provide the arrangement on the same terms to all full-time employees (reimbursement amounts may only vary based on age and the number of individuals covered)
• Not offer a group health plan or a flexible spending account (FSA)

QSEHRA contributions:

With a QSEHRA, small employers can decide what they will contribute to their employees’ health care costs, up to the annual maximum. Employees pay their provider or insurance company for their health care costs, then submit proof of payment to be reimbursed by the QSEHRA. Reimbursement is tax-free. If an employee doesn’t submit a claim, the employer keeps the money, though they may choose to roll it over from year to year while the employee is still employed by the business.

QSEHRA contributions are tax deductible to the employer, while being income tax-free to employees. Additional information about the tax impacts of a QSEHRA can be found through the IRS website at Internal Revenue Bulletin: 2017-47 | Internal Revenue Service (irs.gov).  Small employers should also discuss this employee benefit option with their tax and health insurance professionals to find out how to set up these arrangements.  Employees can obtain information about purchasing individual health insurance plans offered through Nevada’s Exchange at https://www.nevadahealthlink.com/sshix/ or by telephone at 1-800-547-2927.