Any small employers here? Confused about HSA/HRA, 401(k)
 

Hey everyone. Is anyone here a small employer?

We are a new US business and I am due to arrive in the US in April to get things started. We are looking at taking on an employee who has good healthcare with his current job at a big corporate and ideally wants it matched.

I've looked into group health policies to cover myself and co-director and the manager, and it wouldn't be terrible, but seems a bit complicated just for 3 of us right now.

I then came across the HRA, and thought this might be a reasonable solution, allowing us to make a defined contribution and keep things simple. Is there any downside to a QSEHRA? My understanding is we could offer, say, $300/mth for employee only and, say, $500/mth for an employee with family, no hassle and no policies? Does anyone have experience with these schemes?

Or we could go for a decent health policy for an employer cost of $200-300/mth. But then the employee is tied into the specific plan, right?

Or we get a bronze policy with an HSA. But is there any advantage to this vs a QSEHRA?

Then comes the other consideration - personal circumstances. What if I move back to the UK in a few years? If I had an HSA (or 401(k)) saving, would either be more tax efficient to draw down if I were back in the UK?

For simplicity, I am leaning towards doing a simple HRA and 401(k) savings. From a personal point of view, the HRA can contribute to my personal family policy and, depending on my situation with wife and baby (and future pregnancy/time off work, etc), seems more flexible. The 401(k) can be drawn down similarly to an HSA (but with a penalty) to pay for any unexpected costs, although I'd hope we can simply use our savings.

The HRA route also allows us to offer our manager a decent contribution to healthcare costs without having to take out a gold plated group insurance policy.

Any comments or suggestions based on your experience? I am finding US healthcare a bit of a minefield. Thank you.

Re: Any small employers here? Confused about HSA/HRA, 401(k)
 

Your other option is to use a PEO such as TriNet. They will handle all your payroll, file your federal/state employment taxes, and handle your healthcare. You can even set up a 401K.

They are not cheap, but they are worth a look. You will get some of your money back because you won't be spending your time dealing with a lot of this stuff.

For the record, I am not an employee of TriNet but a happy user. https://www.trinet.com/

You could also try ADP.

Re: Any small employers here? Confused about HSA/HRA, 401(k)
 

Thank you. I am familiar with ADP but had not heard of TriNet. I will take a look.

Re: Any small employers here? Confused about HSA/HRA, 401(k)
 

The numbers you mentioned seem very low.

Re: Any small employers here? Confused about HSA/HRA, 401(k)
 

Low? How so?

From what i could see a group health policy with employer paying 50%-70% would amount to an employer contribution of $250-300 per employee per month. So I was then assuming that a similar or slightly higher amount could be offered via an HRA. But that is a figure we can choose right?

Re: Any small employers here? Confused about HSA/HRA, 401(k)
 

This is a few years old but I remember seeing that the average wage for those working at my County was $20,000 but the benefit costs doubled it.

$300 does not buy much for an individual, what if they have a family?