S Corporation shareholders who get insurance through an exchange such as Covered California and get reimbursed by the corporation will not be eligible for insurance.  If the shareholder receives advance premium tax credits (APTC) to subsidize the exchange policy, any reimbursement by the S Corporation or deduction of premiums may reduce or eliminate eligibility for the credit or even result in a repayment of the subsidy at year-end.

So I need to run a few scenarios.

Citations:

1. IRS Pub 974 "If you are provided a QSEHRA [Qualified Small Employer Health Reimbursement Arrangement], and it is considered affordable coverage for a month, no PTC is allowed for that month."

2.  "IRS guidance on the Premium Tax Credit emphasizes that individuals eligible for employer-sponsored coverage that meets minimum value and affordability standards are not eligible for the PTC."

2. "If you enroll in an employer-sponsored plan, including retiree coverage, that is minimum essential coverage, you are not eligible for the Premium Tax Credit for your Marketplace coverage."  Source:  IRS Q&A -- https://www.irs.gov/affordable-care-act/individuals-and-families/questions-and-answers-on-the-premiu...