Understanding ICHRA Q&A

ichra q&A

Individual Coverage HRA (ICHRA) Q&A

What can size employer offer an ICHRA? Is it only an option for small employers?

Employers of all sizes may offer to employees or a specified class of employees. While potentially more appealing to small employers, applicable large employers may offer an ICHRA and design it in a way to meet §4980H (employer mandate) requirements.

Can we allow employees to enroll who are enrolled in a group health plan through their spouse?

No. Only those employees (and their family members) enrolled in individual health coverage or Medicare are permitted to enroll in and be reimbursed by an ICHRA.

Is there a minimum reimbursement amount that must be made available via the ICHRA to meet the requirement to offer minimum essential coverage (MEC) to Full-time employees and their dependents under §4980H(a)?

No, there is no minimum reimbursement level required. If an applicable large employer makes only a nominal amount (e.g., $10/month) available, it would still be considered an offer of MEC for purposes of satisfying §4980H(a) requirements.

Can employees enroll and still receive a premium tax credit (PTC) towards coverage purchased through a public Exchange?

No. Individuals eligible for must choose to enroll or take advantage of a PTC toward coverage through a public Exchange; they cannot have both. Individuals who enroll are not eligible for a PTC toward coverage through a public Exchange because the ICHRA is considered minimum essential coverage (MEC).

Are ICHRAs group health plans subject to ERISA and COBRA?

Yes. It’s a group health plan subject to ERISA, and therefore must comply with plan documentation (e.g., SPD and SBC) and Form 5500 filings depending upon the size of the plan. It is also subject to federal COBRA continuation requirements (for employers with 20 or more employees). An individual who loses eligibility due to a qualifying event must be offered COBRA.

The ICHRA Alliance comprises Administrators, Benefits Advisors, Carriers, and other Insurance Professionals who help employers understand.

Src: Content by Benefit Comply, LLC. 

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