Which plans Qualify for ICHRA?
Different from other types of HRAs, with ICHRA, the ONLY types of health insurance that qualify are:
Major Medical health insurance offered on or off the exchange. These are major medical, ACA-compliant plans and are often referred to as metal tiers because their names include bronze, silver, or gold.
Medicare Part A and B or Part C
Catastrophic plans which are limited to those under age 30 or who qualify for a hardship exemption
Student health insurance
Note that on Medicare, specifically you must have parts A+B or C to qualify, but as long as you have either of those, all Medicare supplements are reimbursable.
The following chart explains which plans are allowed with ICHRA
Which plans are not qualified?
Plans that do not qualify as individual coverage include your spouse's employer group plan, Medicaid, TRICARE, COBRA, short-term plans, indemnity plans, sharing plans, and preventative-only MEC plans.
Why are those the only plans that qualify?
The Individual Coverage HRA requires employees and their dependents to be enrolled in individual health insurance for each month the employee and their family members are reimbursed through ICHRA. In order to be qualified individual coverage, it must meet the minimum requirements as outlined in Public Health Services (PHS) Act Section 2711 and Section 2713. Additionally, expenses must be incurred while an individual’s insurance plan is active. ICHRA does not allow reimbursement for premiums or expenses incurred prior to the insurance coverage start date or before the ICHRA plan activation.
These two provisions require that the employee's plan has:
No annual or lifetime limits on the dollar amount for coverage of essential health benefits
Full coverage of preventative health services to be covered with no shared cost to the insured
Plan compliance verification, ensuring the health plan aligns with ICHRA eligibility, including proof of ACA compliance or individual plan requirements.
In other words, the plan need to meet Minimum Essential Coverage through an individual marketplace plan.
Reimbursement Rules and Processes
ICHRA monthly allowances can be used for reimbursing individual premiums and qualified medical expenses for employees and dependents, subject to the reimbursement structure set by the employer.
Reimbursements are conditional upon proof of enrollment in eligible health plans, with allowable expenditures regulated by ICHRA policy and timing.
How do I find compliant plan?
Take Command Health is here to help! We can help you navigate your options. Reach out to our support team via chat or at support@takecommandhealth.com, let us know what state you're in, and we can help point you in the right direction! To claim reimbursements, employees must provide proof of active enrollment in an ICHRA-compliant plan via their employer’s portal, including evidence of premium amounts and compliance with ACA or other eligibility rules.
It's very important to remember that you cannot accept a premium tax credit if you are claiming reimbursement through ICHRA. Here is a little more about how ICHRA affects your tax credit.
For more information, read on our blog about ICHRA-compliant individual insurance plans.