ICHRA notice requirement: what you should know
The individual coverage HRA is a great option for employers, thanks to its flexibility, efficiency, and affordability. It’s great for employees too, since they can choose the plan that works best for them instead of a one-size-fits-all group plan. But for companies transitioning from a group plan to an individual coverage HRA plan, or if they’re offering benefits for the first time, there’s bound to be a learning curve with this new benefits model. That’s why communication is key. Here’s what to include in your ICHRA notice requirement.
With details set forth by CMS, an employee who is offered an individual coverage HRA will receive a written notice at least 90 days before the beginning of the ICHRA’s plan year.
Remember that employees who become eligible during the plan year, or later than 90 days before the start of the plan year (such as new hires), will get their notice no later than the date on which their coverage under the ICHRA can begin.
The ICHRA notice requirement
Since the Individual Coverage HRA requires employees to purchase insurance for themselves (as opposed to picking a tier option from an employer sponsored group health plan), the employee notice is designed to guide employees in the process of purchasing health insurance from the marketplace which can be confusing if they haven’t done so before. Individual Coverage HRAs must provide a 90 day notice to eligible employees regarding the ICHRA and its interaction with premium tax credits and of the qualifying 60 day Special Enrollment Period (SEP) that is activated when an employee gains access to ICHRA.
What to include in the ICHRA notice requirement
We recommend keeping the employer notice short and sweet. An HRA might be new territory for your employees so keep the insurance jargon at a minimum. Just make sure to include the following required information:
The dollar amount of the HRA offer
The date that coverage under the HRA may begin
Whether the offer extends to dependents (among other things).
Contact information (including a phone number) for an individual or a group of individuals who participants may contact in order to receive additional information regarding the ICHRA
A statement of availability of an SEP to enroll in or change individual health insurance coverage, through or outside of an Exchange, for the participant and any dependents who newly gain access to the ICHRA and are not already covered by the ICHRA.
A statement that the ICHRA is not a QSEHRA.
Take Command can help with ICHRA notice requirements
Our team of small business experts is on hand to chat with you about how to communicate this new benefit to your team. In the meantime, check out our guide on how to set up an ICHRA, ICHRA eligibility requirements, or read about the hallmark feature of this new HRA, the ICHRA classes!
