Individual Coverage Health Reimbursement Arrangements (ICHRAs)

Discover the Flexibility and Savings of ICHRAs: A Modern Solution for Employer-Sponsored Health Benefits

What is ICHRA?

An ICHRA (Individual Coverage Health Reimbursement Arrangement) is a tax-advantaged benefit that allows employers to reimburse employees tax-free for health insurance premiums and other qualified medical expenses. Employers set an allowance, employees choose the plan that fits their needs, submit claims, and then receive reimbursement.

ICHRAs represent a shift in employee health benefits, offering a flexible, modern approach for employers to provide health coverage. Instead of traditional group health insurance, ICHRAs give employees more choice and control over their healthcare decisions. As healthcare costs rise, ICHRAs present an attractive alternative to traditional group health plans for many businesses.

When did ICHRAs start?

ICHRAs began on January 1, 2020. This option was created to give both employers and workers more flexibility in health coverage.

How do ICHRAs work?

  1. Your employer decides how much money they’ll give you each month for health insurance.
  2. You shop for and buy your own health insurance plan from the marketplace or directly from insurance companies.
  3. You show your employer proof of what you paid for insurance and other medical expenses.
  4. Your employer pays you back up to the amount they promised.

Small Business Example

Joe’s Auto Shop offers $400 per month for each full-time mechanic.

  • If Mike’s health insurance costs $350 per month, he gets $350 back from Joe’s Auto Shop.
  • If Sarah’s health insurance costs $450 per month, she gets $400 back and pays the extra $50 herself.

Large Company Example

Big Builder Inc. offers different amounts based on job type:

  • Office workers: $300 per month
  • Skilled laborers: $400 per month
  • Managers: $500 per month

Advantages for Employers

  • Control costs: Set a fixed budget for health benefits.
  • Easier to manage: No need to choose and run a company health plan.
  • Flexibility: Offer different amounts to different types of workers.
  • Tax benefits: The money given to workers is tax-deductible for the company.

Advantages for Workers

  • Choice: Pick a health plan that fits your needs and budget.
  • Portability: Keep your plan even if you change jobs.
  • Tax benefits: The money you get back usually isn’t taxed.
  • Potential savings: You might find better or cheaper plans than a company plan

Easy, Secure, Stress-free

Easy, Secure, Stress-free

HIPAA compliant

Quality coverage (includes pre-existing conditions)

Works with all major medical plans

Buy Individual Insurance

Buy Individual Insurance

Shop for the individual insurance plan that best fits your needs and budget.

Get Reimbursed

Get Reimbursed

Your employers will reimburse you for the predetermined amount monthly.

Important Details

  • Minimum Requirements: Employers must offer at least $100 per month for single coverage or $150 for family coverage.
  • Opt-Out Option: If you don’t want to participate, you can opt-out.
  • Combining Benefits: ICHRAs can be used alongside other benefits like dental or vision insurance.

Key Statistics

  • Over 3 million workers are covered by ICHRAs.
  • Companies using ICHRAs report an average of 20% savings compared to traditional group plans.
  • 78% of workers with ICHRAs say they’re satisfied with their health coverage.

Now you can sign up for the health plan that works for your needs, your doctors, and your prescriptions! Now you can sign up for the health plan that works for your needs, your doctors, and your prescriptions! Now you can sign up for the health plan that works for your needs, your doctors, and your prescriptions!Now you can sign up for the health plan that works for your needs, your doctors, and your prescriptions! Now you can sign up for the health plan that works for your needs, your doctors, and your prescriptions! Now you can sign up for the health plan that works for your needs, your doctors, and your prescriptions!

Learn How ICHRAs Can Benefit Your Business

ICHRAs offer a new way for companies to provide health benefits while giving workers more control over their healthcare choices. They can be especially beneficial for small businesses or companies with a mix of full-time and part-time workers.

Interested in learning if an ICHRA could work for your company? Contact NARFA today for a free consultation.