Paradigm Solutions Group / Healthier Plan

[Guest mjm2950]

Has any one heard of Paradigm Solutions Group, LLC / The Healthier Plan

They promote having employee pay 100% of medical premium through a 125 plan. then reimburse medical expenses under a MERP/HRA (reimbursed amount is close to the after tax cost of the employee). The net effect to employee paycheck is zero, but employer saves money even after admin fees. Typical savings to employer claimed is 10 to 20%. Employee is supposed to keep receipts of qualified expenses and submitt at year end. Meanwhile the employee all year long is receiving reimbursements under the MERP. I asked what if the employee has no receipts or expenses and was told they could sign off stating they had them or make the MERP reimbursements taxable to the employee. Any thoughts or experiences with this program?

[Sandra Pearce]

See IRS Rev. Rul. 2002-80, 2002-49 IRB 925

[GBurns]

Search the old threads for "Double Dipping" arrangements. Do the same on Google and EBIA.

Also search for "HealthIER Plan" and "Health Incentive Plan" since the full name of the plan is apparently HealthIER Incentive Employee Reimbursement Plan.

You might also want to find out from them who was their predecessor, what was sold, under what names (both Plan and promoter), and what happened to get more material with which to search.

Also see Revenue Rulings 2002-3.