Medicare Premiums Reimbursement Through Employer

While your employer can’t pay your Medicare premiums in the true sense, you’ll be glad to know that they may reimburse you for your premium costs! To compensate you, your employer will need to create a Section 105 Medical Reimbursement Plan. We’re here to help you understand your options for reimbursement of employer premiums you’ve paid.

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Can an Employer Pay My Medicare Supplement Premiums?

Medicare Supplement coverage can’t be paid directly by your employer. However, you can get a refund for your monthly premiums from your employer. But, your employer must have a Section 105 plan in place. They can’t write you a check for your Medigap coverage itself, but they CAN refund you for your monthly Medigap premiums, as long as they arrange a Section 105 plan.

There may be instances you can’t get a refund for your Medigap premium. This doesn’t mean you should default to your employer’s health coverage for secondary insurance. Many times, Medigap plans are less costly and provide a wider variety of coverage than your employer’s health plan.

How Medicare Premium Reimbursement Works with an Employer Section 105 Plan

A Medicare premium reimbursement is a fantastic way for active employees to get refunds of their premiums. Often, premiums may cost less than group insurance at your workplace. If you prefer Medicare to your group coverage, you may be eligible to get premium reimbursements. This depends on the program your company has in place. Further, keep in mind that being reimbursed by Medicare versus being reimbursed by your employer are two different topics.

What is a Section 105 Plan?

A Section 105 plan is a reimbursement health plan that lets companies repay employees for their medical costs on a tax-exempt basis. Although there are several different plan options, the most popular Section 105 program is a Health Reimbursement Arrangement plan.

Medicare Premium Reimbursement Arrangement

The type of Section 105 plans employers offers will depend on the employer’s size and whether they provide a group health plan. A Health Reimbursement Arrangement is a system covered by Section 105. This arrangement allows your employer to reimburse you for your premiums.

Some HRAs at employers that provide group coverage require that your employer’s payment plan ties in with the group health plan. Contact a human resources representative at your organization if you have questions about the plan offered to you.

We’ll explain two common types of HRAs offered by employers that can help with your Medicare premiums.

Individual Coverage Health Reimbursement Arrangement (ICHRA)

To be eligible for an Individual Coverage Health Reimbursement Arrangement, you’ll need Medicare Part A and Part B, or Medicare Part C. You can use the ICHRA to reimburse premiums for Medicare and Medigap as well as other costs.

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Employers have more choice in which medical costs are eligible for reimbursement under an ICHRA. The terms must be equal for all employees, and medical costs can’t be designed around what Medicare will or won’t pay.

If your employer offers an ICHRA, you must choose between the group policy option and having the ICHRA cover your Medicare costs.

Qualified Small Employer Health Reimbursement Arrangement (QSEHRA)

If your organization employs fewer than 50 full-time workers and doesn’t offer a group health plan, it may provide a Qualified Small Employer Health Reimbursement Account. To take part in a QSEHRA, you must have minimum essential coverage (MEC), which means enrolling in Part A. Enrolling in only Part B doesn’t count as MEC, but enrolling in Part C does because it includes Part A benefits.

If you have MEC, a QSEHRA will reimburse almost all Medicare premiums; including Part D, Medigap, and Advantage. The only premiums that don’t qualify for reimbursement through a QSEHRA are Part A premiums. Most people do not have to pay these premiums but those who have worked fewer than 40 quarters must pay monthly.

Reimbursements under a QSEHRA are tax-free. If your workplace offers a QSEHRA, talk to a human resources representative about getting your premiums covered.


Can my employer pay my Medicare premiums?
Employers can’t pay employees’ Medicare premiums directly. However, they can designate funds for workers to apply for health insurance coverage and premium payments with a Section 105 plan.
Can my employer pay my Part B premium?
No, it’s not allowed. As a beneficiary, YOU are responsible for paying your premiums. Employers can reimburse any Part B and Part D premiums for employees who are actively working. This requires the company’s payment plan to integrate with the group insurance plan.
Can my employer reimburse me for my Part B premium?
Your employer can refund you for your Part B premium if they’ve set up a Section 105 Medical Reimbursement Plan. Some Section 105 plans may only permit refunds on healthcare costs and premiums. This compensation isn’t taxable. If the Section 105 plan reimburses with cash for any remaining benefits, both the money and reimbursements are taxable.answer
Can a QSEHRA reimburse Medicare premiums?
This type of arrangement can help reimburse employees for their Medicare premiums. If an employee holds minimum essential coverage (MEC), they can get assistance in paying for virtually all Medicare costs, including Medigap premiums.

How to Enroll in Medicare while Still Actively Working

Like so many others, you may have many questions about whether you should enroll in Medicare while still actively working. Making sense of primary and secondary coverage can prove exhausting and frustrating.

Everyone that is Medicare eligible can benefit from the guide to health insurance. Also, our team at MedicareFAQ can help you understand how insurance works. We can also help you to be ready for the monthly costs you may face. Call our team for a free rate comparison today! You can also use our online quote tool to have a premium rate comparison prepared for you.

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Jagger Esch

Jagger Esch is the Medicare expert for MedicareFAQ and the founder, president, and CEO of Elite Insurance Partners and Since the inception of his first company in 2012, he has been dedicated to helping those eligible for Medicare by providing them with resources to educate themselves on all their Medicare options. He is featured in many publications as well as writes regularly for other expert columns regarding Medicare.

28 thoughts on “Medicare Premiums Reimbursement Through Employer

  1. I retired in 2004, 16 years ago on Medicare. My employer was under a 105 medicare premium reimbursement plan. and did tell me about the program for 16 years. So i did not know that i should have been reimbursed for my medicare premiums over all those years. They said that according to their plan rules they only have to make 2 months worth of back payments which mean i must take a loss on 16 years of payments. I appreciate your insight on this because it does not seem right. To me these payments should have been initiated when i retired. In 2019 was the first year they asked for SSA verification of benefits for this purpose. I submitted the verification to them but they couldn’t find it. I submitted the 2020 verification and called to confirm receipt. This is when i found out this benefit was available.

    1. Hi Jacqueline! Thank you for your question. I don’t have enough information to provide you with a straight forward answer. There are many different types of Section 105 plans offered through employers. They are all designed differently and have specific guidelines. If the plan rules have limits, such as only having to reimburse you for two months worth of back payments, then, unfortunately, there’s nothing you can do. However, there might be rules in place where your employer has to prove they told you about the section 105 plan upon employment and/or retirement. Hopefully, this helps!

    2. I just noticed yesterday that my employer has been deducting Medicare f or 4 years. I have been receiving social security retirement since 2018.

      Your INFO is greatly appreciated. I will go to payroll office and se what they can do form. For sure, stop deduction.


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