QSEHRA can reimburse premiums for health insurance plans that provide Minimum Essential Coverage (MEC), including individual major medical plans, Medicare, Medicaid, COBRA, and certain employer-sponsored or alternative coverage types, but it cannot reimburse plans that do not meet ACA Minimum Essential Coverage requirements.
What types of plans qualify for QSEHRA reimbursement?
To be eligible for reimbursement under QSEHRA, you must be enrolled in a plan that qualifies as Minimum Essential Coverage (MEC) under ACA rules.
Common qualifying plans include:
Individual health insurance plans (Marketplace or off-exchange)
Employer-sponsored group health plans (including a spouse’s plan, subject to plan rules)
COBRA continuation coverage
Medicare (Parts A, B, and Medicare Advantage)
Medicaid
CHIP (Children’s Health Insurance Program)
Student health insurance plans (if MEC-compliant)
Certain qualifying alternative coverage types that meet MEC requirements
You must have active MEC coverage in order to receive tax-free reimbursements.
When you upload your proof of coverage, you’ll be prompted to select your plan type from a list on the following screen:
Individual Health Insurance refers specifically to individual, major medical plans purchased either on or off the Exchange. These plans are typically identified by metal tier names such as bronze, silver, or gold. When you select this option, you’ll be prompted to enter your ZIP code and choose your insurance carrier from a list. If your insurance carrier does not appear, it likely means you have a different type of plan, so you should review the other plan type options to find the best match.
Spouse's Employer Group Plan: applies when your health insurance is provided through your spouse’s employer and the premium is deducted directly from your spouse’s paycheck. In most cases, these reimbursements are considered taxable because premiums are typically paid on a pre-tax basis. However, your employer has discretion over whether to allow these taxable reimbursements under the plan.
Medicare: is the correct plan type to select if you are age 65 or older and enrolled in Medicare. If you have the standard red, white, and blue Medicare card, this is the option that applies to your coverage.
Individual Minimum Essential Coverage (MEC): refers to a supplemental plan that meets the Minimum Essential Coverage requirement. This is the option to choose if you have a sharing plan or short-term plan along with a supplemental MEC plan. When submitting your documentation, you should first provide proof of your MEC coverage, and then you can add any additional supplemental plans afterward. If you currently have a sharing plan or short-term plan without MEC, you will need to purchase a qualifying MEC plan in order to be eligible for QSEHRA reimbursements. You can read more about that here.
COBRA Coverage: refers to continued health insurance from a former employer. It is the same group plan coverage you previously had, but instead of your employer contributing toward the cost, you are responsible for paying the full premium out of pocket. This option allows you to maintain continuity of coverage after leaving a job or experiencing another qualifying event.
Tricare: is health coverage available to active-duty military service members, as well as eligible family members and dependents. If you are enrolled in TRICARE, this is the correct plan type to select when providing your coverage information.
Parent's Plan: applies if you are under the age of 26 and covered under a parent’s health insurance plan. While you are eligible to participate in the HRA, premiums for this type of coverage cannot be reimbursed. However, you can still use your full allowance for reimbursement of eligible medical expenses.
Student Health Insurance: refers to health coverage offered through a college or university for enrolled students. These plans are purchased directly through the school and are designed specifically to meet student healthcare needs. If you are enrolled in a university-sponsored health plan, this is the correct option to select when providing your coverage information.
Medicaid: refers to state-sponsored health insurance programs. While the specific program name may vary by state, these plans are typically fully or largely funded by the state. If you do not pay a monthly premium—or pay a very minimal amount—and your coverage is provided by a state program, you likely have a form of Medicaid.
Can I use a spouse’s or parent’s plan with QSEHRA?
Yes, in many cases.
If you are covered under a spouse’s or parent’s employer plan:
The plan generally qualifies as MEC
Only the portion of the premium you personally pay is eligible for reimbursement
If premiums are paid pre-tax through payroll, reimbursements may be taxable depending on plan structure
You cannot receive reimbursement for amounts already paid with pre-tax dollars
You must still provide proof of coverage to verify eligibility.
What plans do NOT qualify for QSEHRA reimbursement?
Plans that do not meet Minimum Essential Coverage (MEC) are not eligible.
Non-qualifying plans include:
Short-term health insurance plans (without MEC)
Fixed indemnity plans
Accident-only plans
Critical illness or hospital indemnity plans
Health care sharing ministry plans (monthly “shares”)
Standalone discount plans or memberships
Life insurance policies
Disability or income replacement insurance
These do not meet IRS requirements for tax-free QSEHRA reimbursement.
Do I need health insurance to use QSEHRA?
Yes. You must be enrolled in Minimum Essential Coverage (MEC) for each month you request reimbursement.
Without MEC:
You are not eligible for tax-free reimbursement
Your claims may be denied
Eligibility may be paused until coverage is verified