HRA Administration

HRA administration is complex and time-consuming, so we have created a service to make the process much easier. With us, you won’t have to worry about the workload and hassle of HRA administration. With our plans, each new client will have a one-on-one consultation with knowledgeable B3PA representatives to ensure it is as simple, efficient, and valuable to the participants as possible.

We offer a variety of designs and features available; B3PA will fully utilize the capabilities of its systems to accommodate as many options as possible.
B3PA option for employers with less than 50 employees.
B3PA will help its employers navigate through the ever-changing regulations
Surrounding benefits such as the Affordable Care Act, Tax Cuts and Jobs Act, etc.
We are dedicated to only operating compliantly.
Plan designs – The benefits card will be an option for specific designs. For some designs, however, the card may become more of a burden than an advantage.

ICHRA

With an ICHRA, your healthcare dollars go further.

Through an Individual Coverage Health Reimbursement Arrangement, you receive tax-free money from your employer to help cover medical insurance premiums for insurance plans you purchase on the individual market. That means fewer out-of-pocket healthcare costs for you and more money in your pocket.

What is an Individual Coverage Health Reimbursement Arrangement?

It is a fully-funded program by your employer designed to help you pay for your individually purchased medical insurance premiums.

How it Works

Your employer put money into your ICHRA when you chose to waive coverage through the group medical insurance plan, are not covered under your spouse’s or parents’ insurance plan(s), and have not received any tax stipend from the Affordable Care Act for your insurance premium. If you meet those requirements, your employer will contribute their set contribution amount towards your monthly premium bill. Because the money donated by your employer doesn’t count as income, there are no tax implications. It’s kind of like getting a raise. Check with your Human Resources department or Plan Administrator for more information about your plan design.

Do I have to have health insurance to have an ICHRA?

To receive your employer’s monthly contribution toward your ICHRA, you must have medical insurance purchased on the private market. If you have medical insurance or your spouse’s employer, you cannot participate in the ICHRA.

How do I know how much it contributed to my plan per year?

At the beginning of each plan year, your employer will notify you of the amount they will contribute to your ICHRA for that plan year.

Do I need to enroll in each plan period?

Yes. All eligible employees must enroll each year during the open enrollment period.

Comparing Health Reimbursement Arrangements

We summarize the tax and related compliance issues applicable to HRAs, QSEHRAs, ICHRAs, and EBHRAs.

Plan Design / Compliance Issues – Internal Revenue Code §105, §106 Code §9831(d) Treas. Reg. §54.9802-4 Treas. Reg. §54.9831-1

An eligible employer is any employer that must offer with sponsor group health plan. An employer must not be an ALE and not sponsor a group health plan. Any employer cannot provide a group plan for those eligible for ICHRA. Any employer must sponsor a group health plan but cannot offer ICHRA to those eligible. Eligible employees group eligible must pass the eligibility test under Code §105(h). Any “eligible employer” employee allows certain employees to be excluded. A group of employees is defined by the Employer participating in individual coverage. Still, it cannot be eligible for group coverage or EBHRA.

They are deemed to pass nondiscrimination rules under Code §105(h) if they meet the regulations. Therefore, a group of all similarly situated individuals as defined by the Employer cannot be offered ICHRA, and the group must pass nondiscrimination rules under Code §105(h). When employees are eligible to participate, A waiting period cannot exceed 90 days. When an employee is no longer considered an excluded employee. A waiting period cannot exceed 90 days. A waiting period can exceed 90 days.

Salary Reduction Funding is not permitted, but can be offered with Health FSA and POP – not allowed, but can be offered with Health FSA and POP – Not permitted, but can be offered with health FSA and POP.
Eligible for HSA contributions? Yes, if reimburses only dental, vision, and preventive care or post-deductible expenses – likely yes, if reimburses only individual coverage premiums – likely yes, if reimburses only individual coverage premiums and certain excepted benefits (e.g., dental or vision) – yes, if reimburses only dental or vision expenses.
Carryover of unused amounts permitted medical expenses eligible for reimbursement otherwise unreimbursed Code §§213(d) medical costs incurred while coverage in effect, including premiums for group eligible health insurance and long-term care insurance, Reimburse individual significant medical health insurance premiums, as well as other Code Section 213(d), expenses incurred during the coverage period, is permitted. Reimburse any Code Section 213(d) medical care expenses or limit reimbursements to particular expenses (e.g., premiums) but not group health coverage. Reimburse any Code Section 213(d) medical expenses but not premiums for individual health coverage, Medicare, or non-COBRA group coverage (premiums for coverage consisting solely of excepted benefits can be reimbursed).
Cash-outs of unused amounts (if no medical expenses) – are not permitted.
Twelve months of coverage & prohibition of mid-year changes – NA.
Health FSA uniform coverage requirement – NA – i.e., coverage level may be prorated by plan design – NA.
Expense substantiation is required.
Claims adjudication required.
Plan design/compliance issue HRAs, QSEHRAs, ICHRAs and EBHRAs: Tax credit HRA is considered with group health plan coverage to determine the minimum value and affordability – Not applicable – Yes, under Code §4980H(a); possibly, under code §4980H(b) (coverage must be affordable) NA. Code §105(h) nondiscrimination requirement applies – NA – if the eligibility rules apply, but the maximum reimbursement amount can vary between classes as provided under regulations.
ICHRAs must not be nondiscriminatory in the operation of the plan. ICHRAs that reimburse insurance premiums will be treated similarly to a thoroughly- insured group insurance plan for nondiscrimination testing.
Employers can decide to fund (i.e., set aside funds) as potential liability increases, but such funding can invoke ERISA’s trust requirement if amounts are segregated from general assets – not required.
ERISA requirements apply COBRA applies if the Employer has 20 or more employees.
Disclosures and notices SPD & SBC SPD & Special Notice SPD.
HIPAA – portability and health status nondiscrimination privacy applies, and Health FSA exceptions are generally not available.