SIMERPU RESEARCH · SOURCE RECAP
CCA 201719025 — Tax Treatment of Benefits Paid by Self-Funded Health Plans
SIMERPU recap and commentary: Mardy Gould
Opened — main text retrieved
Quick recap
Analyzes self-funded arrangements whose predictable benefits exceed after-tax employee contributions. Discusses insurance risk, employer funding and inclusion in income and wages.
SIMERPU’s viewpoint
The self-funded arrangements in this memo make predictability and funding important parts of the discussion. SIMERPU would examine how the promised benefits relate to employee contributions and who bears the economic obligation. Calling a payment insurance or reimbursement should be accompanied by an explanation of its actual operation.
What this source contributes
The discussion brings predictable payments, contributions and economic responsibility into the analysis of a self-funded arrangement.
What remains unanswered
The memo’s particular designs do not establish the economics of every self-insured medical reimbursement plan.
Mardy Gould’s take
I would ask the provider to show what can vary and who pays when it does. If every illustration assumes the same result every month, I want to understand why. A clear financial model should explain the employee’s contribution, the promised benefit and the obligation the employer is taking on.
Questions I would bring to the conversation
1. What determines the amount of each benefit?
2. Can payments vary with actual circumstances?
3. Who bears costs beyond expected contributions?
Mardy Gould · Co-Founder, SIMERPU →
What would change our assessment?
Evidence of a different benefit obligation, funding arrangement or payment variability could change the factual comparison with the designs described.
Read the original source
The original author and publisher are credited below. Continue to their article, document or source page for the complete context.
Original Author: Stephen B. Tackney
Publisher: IRS Office of Chief Counsel
Original Publication Date: 2017-05-12
Read this alongside…
Each connection has a specific purpose. Compare the sources’ facts, positions and publication dates as you read.
CCA 201703013 — Tax Treatment of Benefits Paid by Fixed-Indemnity Health Plans
IRS Office of Chief Counsel
Source position: Neutral / explanatory
Compare the funding questions in insured fixed-indemnity examples.
Read the SIMERPU recap →
26 CFR § 1.105-11 - Self-insured medical reimbursement plan
Cornell Legal Information Institute (reproduction)
Source position: Neutral / explanatory
Read the regulation addressing self-insured medical reimbursement plans.
Read the SIMERPU recap →
26 CFR §1.105-2 — Amounts expended for medical care
eCFR / Office of the Federal Register
Source position: Neutral / explanatory
Examine the separate requirements for amounts reimbursing medical expenses.
Read the SIMERPU recap →
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About this source
Original Updated Date: Not stated
Source Type: Government — nonprecedential tax memorandum
Model Discussed: Self-funded plans; benefits predictably exceeding after-tax employee contributions
Position: Neutral / explanatory
Period: Historical — through 2022
Retrieved: October 31, 2026
Research and date notes
Release date; memorandum dated 2017-04-24. Nonprecedential advice addressing particular arrangements.
Each record identifies the material retrieved. SIMERPU’s viewpoint and Mardy Gould’s take are editorial commentary; the source-position label describes the original source’s stance. Read the original and its qualifications when evaluating a particular arrangement.
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