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Covered California and Obamacare related questions from consumers, employers and agents are answered by Phil Daigle with the best information available at the time. Archived entries may no longer be accurate as the Covered California and Obamacare knowledge-base is evolving quickly. TO REQUEST A PERSONAL RESPONSE INCLUDE EMAIL ADDRESS.

Employer Reimbursement of Premium for Exchange Coverage

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Question: My employer (we have way less than 50 full time workers) plans on dropping our group plan and instead offering $200 (apparently pre-tax) to each employee who provides evidence of purchasing a health insurance policy at the exchange. We all have modest incomes and fall within the household income ranges to qualify for a subsidy. Is this a positive step for all of us? Will we be allowed to have a tax favored reimbursement of $200 and a subsidy from the Exchange?

Answer: Yes. This is a good deal for you. You get subsidized coverage in the exchange plus a contribution from your employer. Whether or not the $200 can be pre-tax to the employees is debatable at this point, but even if it gets taxed as income, it’s still a good deal for you and your employer as well - a win-win.

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