Employers can use ICHRA employee classes to offer different eligibility rules and reimbursement amounts to different groups of employees, provided the classes are based on permitted job-related criteria.
What are ICHRA employee classes?
ICHRA employee classes are predefined groups of employees that determine:
Who is eligible for the ICHRA
How much reimbursement they receive
When they become eligible
Whether they can submit medical expenses in addition to premiums
Classes must be based on objective employment-related criteria and cannot be based on health status or medical conditions.
How Do I Set Up and Manage ICHRA Employee Classes?
Setting up and managing Individual Coverage Health Reimbursement Arrangement (ICHRA) employee classes involves defining specific parameters to ensure eligibility and reimbursement align with your organizational needs. Below, you’ll find a comprehensive guide to create, configure, and troubleshoot ICHRA classes for your employees, regardless of employment type or location.
Step 1: Determining Class Parameters
When creating a new ICHRA employee class, you’ll need to gather key information. The following parameters should be defined clearly:
1. Employee Classification
Identify the type of employees who will belong to this class. Examples include:
Full-time employees
Part-time employees (define criteria, e.g., <30 or <40 hours per week)
Seasonal workers
Salaried vs. non-salaried employees
Employees from the same geographic area (e.g., a specific state such as Colorado)
Non-resident aliens without U.S. income
Employees under age 25
Employees who have not completed 90 days of service
Union employees (unless specified in a union agreement)
2. Waiting Period for Eligibility
Specify how soon the employees are eligible to benefit from the ICHRA based on their hire date. Common options include:
First day of employment
First of the month following 30, 60, or 90 days
3. Reimbursement Type
Determine whether employees can claim reimbursements for:
Premiums only
Premiums and qualified medical expenses (e.g., copays)
4. Reimbursement Rate Structures
Establish how much will be reimbursed for different coverage tiers:
Employee Only
Employee + Spouse
Employee + Children
Employee + Family
Include specifics such as age-based variations in reimbursement amounts (e.g., increases by age, with a base age of 26).
Age curve adjustment
Specify whether reimbursement rates increase based on the employee’s age. If applicable, the base age is typically 26.
Step 2: Configuring and Managing Employee Classes
After defining parameters:
Create the Class: Use your organization’s ICHRA administrative tools to input the defined parameters for the desired employee group.
Assign Employees: Add eligible employees to their respective classes while excluding those who don’t qualify (e.g., part-time or hourly employees for full-time-only plans). There’s no need to create an ineligible class—simply omit those workers from the eligible group. Ensure that all eligible employees are included in the ICHRA roster. If an eligible employee opts out of participation, record their decision as a waiver, either through the system or via an administrator-submitted waiver form. Proper documentation of waivers helps maintain compliance and prevents billing for non-participating employees.
Manage Revisions: As your organization grows or employee groups change (e.g., new geographic locations or job structures), revise class definitions to align with updated criteria.
Default Exclusions: Part-time, seasonal employees, and other categories not explicitly included in a class will automatically be excluded. Ineligible employees should not be added to the ICHRA roster or assigned to a default class. Avoid creating unnecessary classes for ineligible employees to streamline administrative tasks and ensure only eligible participants are considered for reimbursement.
Take Command Navigation: Log into the HRA Hub, navigate to "Employee Roster," and locate the employee whose class you want to edit. Click the three dots next to their name and update their classification.
How to remove an ICHRA class
If you need to remove a class, follow these steps:
Log in to the Admin Portal.
Navigate to the "ICHRA Classes" section.
Select the class you want to remove (e.g., "Part-Time").
Choose to delete or edit the class:
To delete: Select "Delete selected ICHRA – Classes."
To edit: Adjust the class details and save.
Update employee assignments to reassign affected employees to other classes.
Regenerate company documents, such as the adoption agreement and employee notices.
Notify impacted employees about the changes, if necessary.
Step 3: Troubleshooting Common Issues
Issue: The new class doesn’t appear in the portal
Explanation: If your organization was migrated to the HRA Hub, the new classes will appear there instead of the legacy portal.
Solution: Log in to the HRA Hub to view and manage employee classes. Assign employees using the updated interface.
Compliance Tip: Maintain accurate documentation of all changes, including waivers and eligibility updates, to ensure adherence to ICHRA and ACA requirements.
Issue: An ineligible employee or dependent was mistakenly included in the ICHRA.
Solution: Update their status in the employer portal by setting a separation or termination date effective back to the ICHRA plan start date. Submit an ICHRA waiver form for the participant and ensure it is uploaded by the monthly billing cutoff. Retain signed records for compliance purposes.
FAQs: Special Scenarios
Q: What details are essential for ICHRA class setup in unique circumstances, such as new states?
Include geographic-specific classifications and adjust reimbursement rates as necessary. Maintain consistency across all other parameters (e.g., employee classifications, coverage tiers).
Q: Are there templates for full-time employee-only eligibility?
Configure the class to include solely full-time, salaried employees. There’s no requirement to create additional classes for employees who aren’t eligible.
Common questions about employee classes
What is the Employee Required Contribution?
The "Employee Required Contribution" is an estimated monthly amount employees may pay for self-only coverage. It is calculated as: Employee Required Contribution = Lowest-Cost Silver Plan (LCSP) premium – ICHRA allowance
Key points
The LCSP premium is based on the employee’s age and location.
The ICHRA allowance is the employer’s monthly contribution.
This calculation is used for IRS reporting and affordability assessments but does not reflect actual premiums if employees choose different coverage.
How do I change the waiting period for a class?
Waiting period changes for an ICHRA class cannot be made directly in the Admin Portal — they require a plan document change. Contact Customer Experience with your company name, the current waiting period, the new waiting period you need, the effective date, and whether any current employees should have their eligibility dates adjusted retroactively.
An employee is in the wrong class — how do I move them?
To update an employee's class: Admin Portal → Employee Roster → find the employee → click the three-dot menu → Edit → update their class. The change takes effect for future reimbursements based on the updated class allowance.
If the class change needs to be retroactive (for example, an employee was in the wrong class for several months and received an incorrect allowance), contact Customer Experience with the employee name, the correct class, and the date the correction should apply. Retroactive class corrections cannot be processed through the portal.
An employee wants to waive ICHRA participation — how do I record that?
An employee who opts out of ICHRA participation must submit a waiver through their Member Portal. Employers cannot set Waived status from the Admin Portal.
If the employee's enrollment window has passed or they cannot access the portal, contact Customer Experience. They can process the waiver manually and provide the waiver documentation you need to retain for compliance purposes.
My new class is not appearing in the portal after I set it up
If a newly configured class is not visible in the Employee Roster or the portal's class assignment dropdown, log in to HRA Hub (app.takecommandhealth.com) rather than any legacy portal URL. Classes are managed through the current HRA Hub interface.
If the class is still missing after logging in to HRA Hub, contact Customer Experience with your company name and the class name — the class may not have been saved correctly on the backend.
I need to add a new state or geographic class for a remote employee — what do I do?
Adding a new geographic class (for example, an employee in a new state) requires a plan configuration update. Contact Customer Experience with your company name, the employee's state, the reimbursement amount and coverage tier for the new class, and the effective date. They will update your plan documentation and create the class on the backend.