If you offer a self-insured medical expense reimbursement plan, such as a Section 105 plan, the reimbursements paid under that plan might be excluded from the employee’s gross income (ask your tax advisor). If so, you could handle it in one of the following ways:

  1.  Add it as a Reimbursement to the employee’s regular paycheck (or a separate check with just the reimbursement).
  2.  Or, treat the employee as a Vendor and issue a separate Vendor Check from the Expenses & Ledger module (or whatever system you use to pay expenses). If you do this often, you may Add a Vendor, such as Employee Medical Reimbursement, to easily track these items.