Short answer: An MPRA is an employer arrangement, generally for small employers with fewer than 20 employees, that reimburses Medicare-enrolled employees, tax-free, for their Medicare Part B, Part D, and Medigap premiums.
A Medicare Premium Reimbursement Arrangement (MPRA) lets a small employer help Medicare-enrolled employees pay their Medicare premiums on a tax-free basis. It typically reimburses Part B, Part D, and Medigap premiums (and sometimes other 213(d) expenses).
MPRAs generally work only for employers with fewer than 20 employees, because that’s when Medicare pays primary and the Medicare Secondary Payer (MSP) rules don’t prohibit integrating with Medicare. At 20 or more employees, the group plan is primary and an employer may not steer or incentivize active employees onto Medicare. An MPRA must also meet the conditions in IRS Notice 2015-17 (for example, the employee must be enrolled in Medicare Part B or D).
Sources
- IRS Notice 2015-17 (employer payment of Medicare premiums); Medicare Secondary Payer rules, 42 U.S.C. §1395y(b).
Content history
Originally published: June 16, 2026
Last reviewed: June 16, 2026