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5 Tips for Employers Offering an ICHRA for the First Time

Published on

Oct 23, 2024

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Author

Griffin Baker

POV: You’re an employer setting up an Individual Coverage Health Reimbursement Arrangement (ICHRA) for your team’s health benefits for the first time. Here are 5 tips to help you to navigate this transition effectively.

1. Trust in Your Employees’ Capabilities

The biggest fear we hear from HR teams is that “employees can’t possibly choose their own health insurance plan.” It’s a very understandable worry. But, in our experience implementing hundreds of ICHRA Open Enrollments, employees often rise to the occasion.

Of course, this doesn’t happen by magic.

We recommend hosting an Open Enrollment Workshop. Venteur also offers 1:1 appointments with licensed benefits experts. What you’ll find is that ICHRA empowers employees and helps them to feel more confident in their healthcare choices.

In short: provide your employee with support, but also trust in their ability to navigate the health insurance options available.

2. Allow Ample Time for Open Enrollment

Timing is everything when it comes to Open Enrollment. Aim for a window of two weeks. Larger groups might aim for three weeks.

This timeframe allows employees to fully understand the ICHRA structure, explore their plan options, and discuss their choices with family.

Extending beyond three weeks tends to deliver diminishing returns.The reality is that some employees will wait until the last minute to complete their health insurance selection and end up making a snap decision. We recommend identifying a balance that works for your team.

3. Verify Provider networks

For employees with specific healthcare needs, we strongly encourage that they speak directly with their providers to confirm what plans are accepted. A simple phone call to the provider's office can clarify which specific plans are accepted. For instance, while a doctor may take Blue Cross Blue Shield, they might not accept every plan under that umbrella. You may also get intel from your provider. For example, they may be in-network now but planning to no longer accept a certain type of insurance soon. These details can make sure “go-to” doctors remain accessible.

4. Understand ID Card Processes

Some carriers may issue cards promptly, while others may take longer, so keeping everyone informed is key.Educate employees on the varying processes and timelines for obtaining ID cards from different carriers. This knowledge can prevent confusion and frustration. For further details, please see our Help Center article here.

5. Set Expectations for Invoices

Let employees know that they will receive invoices from their insurance carrier. This is because they are the policy owner of their plan and is completely normal. This happens even if you’ve hired an ICHRA platform like Venteur to pay premiums on your employees’ behalf. Informing employees ahead of time can help avoid confusion and anxiety.

And that’s it! We wish you a successful ICHRA rollout for your employees. If you have any questions, please don’t hesitate to get in touch. We’d be happy to help!

FAQs

You got questions, we got answers!

We're here to help you make informed decisions on health insurance for you and your family. Check out our FAQs or contact us if you have any additional questions.

How does an ICHRA work?

ICHRA stands for Individual Coverage Health Reimbursement Arrangement (ICHRA). This health arrangement allows you to pick your own health insurance plan using your employer’s monthly tax-free allowance. These funds can be used to cover insurance premiums, including dental and vision, as well as qualified medical expenses.

What are the benefits of an ICHRA?

Your health plan belongs to you, and you can keep your health insurance if you leave your company.
You get to choose from any qualified health plan on the market. Venteur can help you select a plan where your preferred doctors, providers, and prescriptions are covered.
If you choose a health plan that costs less than your employer contribution, the extra funds are added to Venteur’s Health Wallet, an account used to pay for qualified medical expenses.

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What's the difference between an ICHRA and a Group Plan?

Group health insurance plans are purchased by companies and offered to their employees. Traditional group plans take a one-size-fits-all approach to healthcare, giving employees limited choice when it comes to their coverage options. Employer-sponsored ICHRAs give employees a tax-free allowance to pick any plan on the public exchange that meets their unique needs.

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What is the Health Wallet and how can I use it?

1. What Your Health Wallet Balance Represents:

Your Health Wallet balance could be thought of as a measure of the medical expense reimbursements you're entitled to under your health insurance plan. It's essential to note that it isn't quite like a bank account with a set amount of accessible cash. Rather, consider it as a marker of what you're eligible to get reimbursed for as part of your ICHRA plan.

When you shop for insurance through the app, you will see a dollar amount that is available for out-of-pocket expenses. This amount is what gets contributed to your Health Wallet account for your use in reimbursements. However, depending on how your employer has setup the account, it may be available immediately or it may be available after every monthly invoice.

2. Your Health Wallet Account:

When your account is setup, there is a predetermined way on how your Health Wallet functions for your reimbursement funds. The first scenario is that there is money that has been set aside at the start of the period which can be used for your reimbursements. You may see the entire amount entitled to you is immediately available for medical expense reimbursements. It's like having a store of health benefits ready to be used when you need them.

3. Simplifying the Health Wallet Experience:

We're always striving to enhance your experience and are currently working on making the Health Wallet balance operate more like a pre-paid debit card. This shift aims to streamline the funding process further and allow you quicker and more direct access to your health reimbursements, leading to an even smoother journey for you.

Remember, whether your account shows the funds immediately or after every invoice, it doesn't affect the overall sum you're entitled to under your ICHRA plan; it merely affects the timing of when you will receive the reimbursements.

Your trust is important to us, and we're continually striving to make our services better for you. If you ever have questions about your Health Wallet or anything that would help make for a more understandable benefits experience with us, don't hesitate to reach out to our customer service team.

Do ICHRAs meet the Affordable Care Act's employer mandate?

The Affordable Care Act (ACA) requires that employers with more than 50 full-time equivalent employees provide health insurance to their employees. This is known as the 'employer mandate'.

ICHRAs can meet the mandate as long as they are considered 'affordable.' According to IRS, 'an ICHRA is affordable if the remaining amount an employee has to pay for a self-only silver plan on the exchange is less than 8.39% of the employee’s household income.'

To simplify, this means that the ICHRA contribution an employee receives cannot be less than the lowest-cost silver plan available to the employee - (9.02% of the employee's household income).

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