Qualified Small Employer Health Reimbursement Arrangement

Written Notice

You must provide notice to all employees no later than 90 days before the first day of the plan year of the QSEHRA


If you’re setting up a QSEHRA for the first time, the notice may be sent at any point prior to, and including, the day your QSEHRA goes into effect

Failure to provide the initial written notice will result in a penalty of $50 per employee


(up to the maximum of $2,500 per calendar year per eligible employer)


Under the notice, the QSEHRA written notice must:

1. Define which employees are eligible;​


2. Remind the employee that they are still subject to the individual penalty for months where they do not have coverage, and


3. Contain the following information:


  • A statement of the amount of each permitted benefit for which the employee might be eligible;


  • The date on which the QSEHRA is first provided to the eligible employee;


  • A statement that the eligible employee must inform any Marketplace to which the employee applies for advance payment of the premium tax credit (APTC) of the amount of the provided benefit;


  • A statement that the amount of the provided benefit may affect the eligibility for and the amount of the premium tax credit and that the employee should retain the written notice because it may be necessary to calculate the premium tax credit on the employee’s individual income tax return; and​


  • A statement that if the eligible employee does not have minimum essential coverage for any month, then the employee may be liable for an individual shared responsibility payment under Section 5000A of the Affordable Care Act for that month and that reimbursements under the QSEHRA for expenses incurred in that month will be included in the employee’s gross income.