The state of Pennsylvania, specifically in markets like Pittsburgh and Philadelphia, is at the forefront of a new benefits model called the individual coverage HRA (ICHRA, for short). Here's why this state is positioned to win with ICHRA, how local business owners are reimbursing for health insurance, and how it can benefit your business or your client.
As a quick refresher, the individual coverage HRA, a new type of HRA that was new January 2020, allows employers of all sizes to reimburse for individual health plans that their employees choose based on their needs. Reimbursements for premiums and medical expenses are tax-free for everyone and give employers more flexibility and control over their benefits plans and employees more choice and personalization.
Why Pennsylvania ICHRAs are gaining traction
Individual coverage HRAs are most successful in locations with strong individual health insurance markets. Factors like individual premium pricing vs group pricing, carrier competition, the number of plans available and stability come into play here.
Pennsylvania, specifically in Philadelphia and Pittsburgh, has a very affordable, stable, and competitive individual health insurance market, with the average rate increase requested at just 2%.
Workers in Pennsylvania with an ICHRA have a whopping 404 health plans to choose from!
Pennsylvania's major metros are poised for success with ICHRA. We've even put together individual guides for each city to help employees in those cities determine their best options for individual health insurance where they live. If you're considering ICHRA in one of these metros, see below to learn about the options employees will have.
- Philadelphia Individual Health Insurance to use with ICHRA
- Pittsburgh Individual Health Insurance to use with ICHRA
How are Pennsylvania ICHRAs reimbursing employees for health insurance?
The average reimbursement amount in Pennsylvania is $451.84, with the lowest cost bronze plan coming in at $250.66 for an individual and the lowest cost silver coming in at $305.22 for an individual. In contrast to group plans that typically only cover 70% of the premium cost (the remainder comes out of employees' paychecks), Pennsylvania ICHRAs are covering 180% of bronze plan premiums and 148% of silver plan premiums. The rest of the allowance, if the plan allows, can reimburse eligible medical expenses (like prescriptions, glasses, copays, etc). For larger companies (50 to 300 employees), the monthly reimbursement rate was slightly higher, at $513.27 each month for individuals.
Health insurance carrier options for individual health insurance in Pennsylvania
- Ambetter
- Capital BlueCross
- Geisinger
- Highmark BlueCross BlueShield
- Independence Blue Cross
- Oscar
- UPMC
- Cigna (coming in 2022!)
Among our clients, their employees most often enrolled in a plan from Highmark BlueCross BlueShield and UPMC.
What types of companies are opting for ICHRA?
Businesses of all sizes are offering ICHRAs and types of companies using ICHRA run the gamut! Associations, churches and non profits together take the lead spot, but blue collar service industry, tech, healthcare services, household workers, and those in the hospitality industry trend high as well.
Want to learn more about the Pennsylvania ICHRA opportunity?
We are here for all the questions. Chat with us in the bottom right hand corner of your screen and our team of experts will fill you in on the Pennsylvania ICHRA trend, how its changing the way we talk about health benefits in the state (and nationwide!), and how it could benefit your business or client.
A few more resources for you:
Let's talk through your HRA questions
I wrote this blog because I care about ideas (big and little) that can help fix our healthcare system. I used to work on projects for Kaiser Permanente and the Parkland Health & Hospital System so I've seen the system inside and out. It's so important that consumers keep up with industry shifts and changing health insurance regulations. I'm also Take Command Health's Content Editor and a busy mom. Learn more about me and connect with me on our about us page. Thanks!
