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A Guide to Premium Reimbursement Arrangements

Administration Software for a Premium Reimbursement Arrangement

Premium Reimbursement Arrangements are an alternative to traditional employer-sponsored health Administration_software_premium_reimbursement_arrangementbenefits, allowing companies to reimburse employees for individual health insurance. Employers use a Premium Reimbursement Administration Software to stay compliant, and to make administration easy.

1. Employee Education & On-Boarding

While this first feature isn’t entirely a "software" feature, it is one of the most important considerations of offering a Premium Reimbursement Arrangement: employee education and company on-boarding. The Premium Reimbursement Administration Software should provide you a toolkit to help your company:

  • Understand the benefit (What is premium reimbursement? How does it work?)

  • Understand the benefits of individual health insurance

  • Learn how to request reimbursement and use their participant portal

Help Center

2. Employee Allowances

The Premium Reimbursement Administration Software should allow you to give employees allowances monthly or at any time on an exception basis—with automatic monitoring of HIPAA and ERISA discrimination compliance rules. Deferred allowances (a waiting period) should be possible for new hires, and suspended allowances should be allowed for former employees that employers hope to re-hire on a seasonal basis.


3. Reimbursement Request Submission

Employees should be able to submit requests for reimbursement online, by fax, or by mail, and immediately receive an email acknowledging their request and providing an online link to monitor status. Documentation should be permanently available online for convenient access by employees.

Submit Claims ZaneHealth

4. Reimbursement Processing

The Premium Reimbursement Software Administration provider should process requests within 24 hours and employees should be able to inquire about their request via online chat, email, fax, mail, or telephone. No request should be rejected for improper or incomplete submission without multiple contacts. All employee contact should leave clear audit trails and meet appropriate regulatory guidelines (e.g. ACA, IRS, HIPAA, ERISA, and SAS 70). Look for software that provides “real-time” tracking of requests, available online 24/7.

View Claims

5. Reimbursement Requests

Employees should receive email notification when their request is approved and again confirming when (and how) it is reimbursed. Reimbursement should be administered individually or on a periodic batch basis via check, payroll addition, or direct deposit leaving a clear and permanently-available audit trail.


6. Employee Ledger  

All employees should have access to an online ledger showing their current balance, allowance, requests, and reimbursements including permanent storage of receipts, relevant tax information, Plan Documents, and the ability to save or export their own medical information via the administration platform.


7. Integrated Electronic Plan Documents, SPD, and Employee Signature

The Plan Document, Summary of Benefits and Coverage (SBC), and SPD (Summary Plan Description) should be electronically created, readily accessible online, and signatures should be collected electronically. Employers should be able to administer a change to benefits for any specific Class of Employees at any time and the electronic documents should automatically change and, where required, new electronic signatures should be collected when the employee is next online.

Plan Documents

8. Classes of Employees

Employers should be able to instantly create unlimited different Classes of employees with each Class receiving different benefits by employee family status.

Classes Employees


9. Employee Enrollment & Termination

Employers should be able to instantly enroll or remove employees in real-time on an individual or batch basis, with automatic printing of employee welcome kits and other appropriate plan administration information.

Employee Management

10. Plan Setup

Employers should be able to completely set up and/or change both their premium reimbursement Health Plan and their Plan Documents simultaneously online.

Easy Plan Setup

11. Reporting

Employers should be able to view all reimbursements by employee or by Class of employees, and monitor in real-time claim information for each Class of employees. Employees should be able to see 3-5 prior years of history.

Utlilization Report

12. Tax Forms and Information

All information for required administration reporting (e.g. 5500 for employers with more than 100 employees) should be available online in real time, and non-eligible plan participants (e.g. independent contractors, owners of Sub S companies) should receive appropriate 1099 information.

IRS Forms

13. Personal Health Insurance Distribution          

Premium Reimbursement Software should automatically provide the employer’s health insurance broker a CRM (Customer Relationship Manager) to best serve their employees—including automatic notification to the broker when an employee’s premium reimbursement plan status changes due to family additions, promotions, etc.

Integrated Insurance

14. HIPAA and ERISA Compliance

The employer should be automatically protected and the plan administration made HIPAA Compliant through technology rather than the training of administering employees. For example, employers should not be able to view HIPAA-protected employee information, and should automatically follow Department of Labor, HIPAA, and ERISA guidelines for employers allowing insurers’ access to their employees.

HIPAA Claim Protection

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