How does the STRATEGY work?

A 401 (h) is a post-retirement individual medical expense reimbursement account to the base pension, cash balance plan, or traditional pension design under IRC §401(h) and can increase your pension contribution up to 33 1/3%.

This account provides a highly efficient way to fund retiree health benefits. Contributions to the account are tax-deductible, earnings on the account grow tax-free, and health benefits paid from the account are not taxable to retirees if used on qualified medical expenses. The account can be considered similar to a health savings account with higher contributions limits i.e multiplied by to the power of 10.