The proposed rules and guidelines surrounding ICHRA could prove beneficial for your company financially in terms of flexibility for both you and your staff. Take Command Health is dedicated to updating you as we find out new information as well as clarifying what these changes mean for your company.
Excepted benefit HRA
One thing we should explore first is the excepted benefit HRA. If you offer group insurance to your employees, this smaller HRA would be an additional benefit that would work together with the proffered group policy. The excepted benefit HRA allows companies to reimburse their staff for specific medical expenses, such as an eye exam or dental visit. This HRA is exempt from ACA group insurance requirements and caps out at $1,800 per employee for each year.
However, the excepted benefit HRA cannot be offered in conjunction with the individual coverage HRA. It won’t allow employers to reimburse premiums for either individual nor group health policies, nor for Medicare parts B or D. Excepted benefit HRA can only reimburse for benefits such as premiums for dental or vision plans and expenses that arise from such visits.
Special enrollment periods
Currently, those who participate in QSEHRA must wait for open enrollment or until they experience a qualifying life event to enroll in individual health insurance. However, special enrollment periods will be created through the proposed regulations for anyone who becomes eligible for the individual coverage HRA (ICHRA) as well as for QSEHRA beginning in 2020.
ICHRA and Premium Tax Credits
Unfortunately, employees will not be allowed to receive tax credits if they are enrolled in ICHRA. However, employees will be allowed to opt out of the ICHRA for at least a year. If they choose to opt out, they will be allowed to receive tax credits for that year if the ICHRA plan offered is deemed "unaffordable".
Can you pair ICHRA with other HRAs?
You may be able to offer ICHRA with QSEHRA, but the benefits offered from both may be redundant and therefore not beneficial. And because you cannot offer ICHRA in conjunction with a group plan to the same class of employees, it wouldn’t work with excepted benefit HRA. However, you could offer excepted benefit HRA to one class and ICHRA to another, as long as the classes are defined fairly.
Making the best decision
With the added benefits of each HRA option, there are a lot of choices to make in the coming year. Take Command Health will be here to answer any questions you may have as well as keep you informed on any changes as they happen.
Is your company or client going to be a part of this exciting change? Chat with our team with any questions you may have about these new, tax-friendly benefits or check out our new ICHRA Guide for more information on its background, setup process, requirements, and rules.
We will keep this page updated as more information comes in. Stay tuned!