Recently released IRS Notice 2017-67 clarifies the requirement that eligible employers who provide a QSEHRA to its eligible employees furnish a written notice to each eligible employee at least 90 days before the beginning of each plan year.
The new guidance is that an eligible employer that provides a QSEHRA during 2017 or 2018 must furnish the initial written notice to its eligible employees by the later of (a) February 19, 2018, or (b) 90 days before the first day of the plan year of the QSEHRA.
For employees that are not eligible to participate at the beginning of the year (e.g. a new employee hired mid-year), the notice must be furnished before the date on which the employee is first eligible to participate in the QSEHRA.
Penalties will apply to any employer that does not furnish the initial written notice by that date. The penalty is $50 per employee, up to a maximum of $2,500 per calendar year per eligible employer.
The practical ramifications of this new guidance are that any QSEHRA implemented on or before May 1, 2018 should provide the written notice to eligible employees before February 19, 2018. And for QSEHRA's implemented on or after June 1, 2018 (assuming your plan begins on the first day of a month) the written notice should be provided 90 days before the start date of the QSEHRA.