In nine short months, ICHRA (aka the Individual Coverage Health Reimbursement Arrangement) will be available for businesses of any size, extending the tax-free reimbursement benefits of QSEHRA to a larger pool of employers. One of the benefits of ICHRA is the increased accessibility and ease of use for businesses, like the fact that it will trigger a special enrollment period (SEP).
Why Special Enrollment Periods for ICHRA are so great
Unlike a QSEHRA, ICHRA will trigger a special enrollment period for users, thanks to specifications laid out in the proposed legislation.
This is a big step over QSEHRA in terms of accessibility and ease of use.
Our QSEHRA clients we've helped in the couple of years face challenges when they offer a QSEHRA outside of open enrollment. What happens is that their employees have a really, really hard time finding adequate coverage that meets the MEC requirement.
For example, if Joe Brown’s boss cancelled the company’s group policy mid-year but set up a QSEHRA to help cover the costs, Joe is now on the hook for finding health coverage for his family of four.
In most markets, the individual market gets pretty dicey outside of open enrollment. A lot of the plans that are available to sign up outside of open enrollment, like faith-based plans or short term plans, don't meet minimum essential coverage requirements so employees had to also find a MEC plan to accompany those non-traditional plans.
As you can see, it gets a little complicated.
ICHRA simplifies the whole equation, meaning that employers can opt for an ICHRA at any time in the year, and employees will be able to choose plans on the individual market just as they would if they'd had another special enrollment period trigger, like getting married or having a baby.
The SEP trigged by ICHRA benefits both employees and employers. For business owners, it means that they have the freedom to choose to offer this benefit any time of year, even if its outside of open enrollment or if it means cancelling their group plan.
The benefit to employees bold down to convenience and flexibility. By using an ICHRA to reimburse for individual policy premiums and medical expenses, employees are gaining a much simpler process that translates to less headaches and stress!
This is a sigh of relief for many people who no longer have to keep tracking of premiums to more than one carrier each month or scrambling to find a sufficient health plan in the off-season.
How long do you have to enroll in an individual plan once an ICHRA is offered?
Wondering how long that special enrollment period lasts? Employees have 30 days to enroll in their health plan of choice from their date of hire or when their employer offers tax-free reimbursement through an ICHRA. This leaves plenty of time for employees to shop around and truly find the right plan for their individual health needs, especially with Take Command Health's data-driven individual health insurance shopping platform, which can help them search for affordable plans based on their needs, their prescriptions, and their doctors.
Take Command Health is here to help you navigate the ICHRA ins and outs. We see a great opportunity to really transform benefits for employers of all sizes with ICHRA. Let us know how we can answer any questions you have about ICHRA and in the meantime, make sure to check out our FAQ post here.