Individual Coverage Health Reimbursement Arrangements (ICHRAs) are quickly becoming the new way to provide employee health-related benefits. These unique platforms allow companies to offer cost-controlled reimbursements for healthcare services in lieu of expensive, traditional health insurance plans. ICHRAs are flexible and customizable, making them ideal solutions for a variety of business sizes and segments. And when your employees realize the benefits of taking back control of their own health insurance decisions, they soon embrace the ICHRA way forward, too. One of the most significant perks to offering ICHRAs is their inherent ability to grow with your company. Here are three ways ICHRAs can transition to meet your business goals in the years to come.
1. ICHRAs Grow with Your Company Employees
Regardless of the product or service your company offers, what matters most to your success are your teams. As your business grows, your employee structures will likely expand, too. Launching an ICHRA today will mean having a customizable platform in place that will develop along with the needs and preferences of your staff.
Adding Teams to the ICHRA Plan
Business growth can often mean new products or services to offer, and with them, additional support teams. Growth for some translates to new brick-and-mortar storefronts or offices across state lines. As you need to add employees to the company directory to support that growth, you can rest assured your ICHRA will be adaptable with each new member.
Changing the Types of Eligible Employees
Sometimes company growth comes in the form of new seasonal opportunities. These peaks can translate to a new need for part-time, temporary, or seasonal staff. If you have an ICHRA in place, you can extend those reimbursement benefits to new hires, regardless of their type. This type of flexibility is attractive and lucrative to growth-minded leaders who look for cost-effective ways to provide benefits and compliant options.
Group Plans & ICHRAs
The beauty of offering an ICHRA for your business is being able to do so in tandem with your traditional group plan. Per IRS guidelines, companies can offer an ICHRA as an entirely stand-alone feature or alongside a group health insurance policy as long as each is not offered to the same group of employees. This makes ICHRAs perfect for those businesses providing group coverage for full-time or salaried teams and still in need of an affordable benefit for the remaining part-time or seasonal staff.
2. ICHRAs Are Customizable to Company Budgets
Businesses large and small are leveraging the many benefits of the ICHRA model. Another key benefit of ICHRAs is the flexibility in creating designated reimbursement budgets. And in today’s business environment, benefits budgets are tighter than ever. The ICHRA allows for a more cost-effective offering that meets nearly any company budget. And as you look to future growth, your ICHRA budgets can grow, too.
Establishing Employee Allowance Amounts
There is a fixed-cost approach to setting up an ICHRA that allows companies to carve out employee allowance amounts upfront. This helps businesses predict expenses in a tangible way. And it eliminates unforeseen overspending throughout the plan year. Also, ICHRAs don’t impose minimums, meaning companies can offer as much or as little as the HR budget allows per employee.
Employees who leverage the ICHRA are required to enroll in an individual health insurance plan to be eligible. Any out-of-pocket expenses related to health and wellness can then be submitted to the employer for a tax-free reimbursement. This model allows individuals to control and manage their costs better without making those expensive payroll contributions associated with traditional group health plans.
Flexible ICHRA Processes
The processes behind managing an ICHRA are just as flexible as the setup parameters. Companies can choose what types of expenses can be covered and reimbursed. They can also decide when and how those reimbursements are given. For example, some businesses establish monthly reimbursement timelines, while others pay immediately upon employee receipt submission. Your company can elect to develop a completely independent method of payment or include those reimbursements with regular payroll initiatives.
3. ICHRA Support Around Every Corner
As a business owner, you’ll appreciate the bottom-line benefits and flexibility. Those on your team responsible for launching, operating, and managing your ICHRA will appreciate the robust availability of support along the way. Your company can choose to handle things entirely internally or outsource support as needed.
Starting an ICHRA
Any company can submit to set up an ICHRA independently. The IRS will provide next step requirements, including an itemized plan that outlines your dictated reimbursement amounts per employee, your timeline to launch, and the types of employees you plan to support. The startup process, for many, is easy to do and can be done on your own if you’re confident in doing so. But if you need help getting your plan together or organizing employee introductions to the ICHRA platform, partners like W3ll can be instrumental in your ICHRA success.
Growing Into an ICHRA
You may start your ICHRA on your own and then realize later that you need help managing it. As companies grow, staff numbers grow, as do reimbursement budgets. Growing into your ICHRA may require additional support, and there’s plenty available to help. W3ll can be a great ICHRA partner, bringing tools and expertise to your process.
Third-Party Administrator Partnerships
If your employees are new to the ICHRA, they’ll likely have questions about how to submit their expenses and where to go to find their individual health insurance coverage. Third-party administrators are great lines of support in providing answers and directions to your staff. TPAs can also innovate by creating digital dashboards for employees to use in managing their receipts and reimbursements. Having a TPA partner like W3ll also means having access to critical data, including adoption rates, budgets, and any new IRS requirements for ICHRA plans.
If you have been considering an ICHRA but are worried about it growing with your company, don’t. The very nature of the ICHRA is flexible and customizable, making it a short-term change that can grow with your company well into the future. Contact W3ll to learn more and explore your options, as we can grow with your company and ICHRA, as well.