How to Reduce Costs and Improve Benefits using Medical Expense Reimbursement Plans

What you need to know


Looking for a robust tool for employers seeking to manage healthcare costs effectively? Take a look at Medical Expense Reimbursement Plans (MERPs). Not just a funny word, MERPs are recognized under Section 105 of the Internal Revenue Code (IRC). These plans allow employers to contribute towards employees’ health plan deductibles, coinsurance, copayments and other qualified medical expenses tax-free. Unlike Health Reimbursement Arrangements (HRAs), MERPs are not associated with a physical account. Instead, employers reimburse incurred expenses, crafting an adaptable and responsive process for each employee’s healthcare needs.

Adopting a MERP is a strategic step towards taking consistent control over healthcare costs. Employers typically see considerable savings in the first year of implementing a MERP, with a longer-term goal of stabilizing these costs over time.

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