How does an individual coverage health reimbursement arrangement work?

An individual coverage health reimbursement arrangement (ICHRA), now known as the CHOICE Arrangement, is an employer-funded benefit that lets employers provide tax-free contributions toward employees’ individual health plan premiums. Employers set contribution amounts based on their healthcare budget, eligible employees select qualifying individual coverage, and use their employer-provided contributions to cover the cost.

Who is eligible for an ICHRA?

Employers of any size can offer an ICHRA to eligible employees. Employees must have qualifying individual health insurance coverage to participate. For greater flexibility, employers can vary contribution amounts by job-based employee classes, age, or family status.

Can employees choose their own health insurance policies with an ICHRA?

Yes. Employees choose individual health insurance plans that fit their healthcare needs, preferred provider networks, and budget. To use the benefit, they must enroll in qualifying coverage, such as ACA Marketplace health plans, certain student coverage, and eligible Medicare policies, like Medicare Parts A and B together or Part C.

How are ICHRA premiums paid?

Premium payment arrangements depend on the employer’s benefit administration process. Some organizations provide their employees with tax-free reimbursements, up to their contribution limit, after they pay for their monthly premiums. With Remodel Health, Autopay coordinates funding and automates premium payments directly to insurance carriers on time.

Does an ICHRA satisfy the ACA employer mandate?

An employer can satisfy the Affordable Care Act’s employer mandate for applicable large employers (ALEs) if their group coverage provides MEC, meets minimum value standards, and is affordable. With an ICHRA (now a CHOICE Arrangement), employers only need to offer an affordable contribution to at least 95% of their full-time employees and dependents. Employers should review their ICHRA benefits annually to ensure their contributions meet ACA regulatory requirements.

Meet Remodel Health, your trusted ICHRA provider.

Why partner with Remodel Health?

Not only will you have access to a top-notch enrollment team for your clients, but you’ll also unlock exciting rewards and substantial pay. With Remodel Health, success is just around the corner. By connecting with us, you can:

Gain a deeper understanding of the Remodel Health approach.
Learn how to offer cost-effective solutions to your clients.
Explore our tools and resources for improving customer service.

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What is an ICHRA?

If you’re looking to supercharge client offerings, ICHRAs are for you. An Individual Coverage HRA, or an ICHRA, is a type of Health Reimbursement Arrangement (HRA) that increases flexibility for employers and employees to better utilize the Individual Marketplace. This employer-funded HRA allows employers of any size or industry to reimburse employees tax-free for qualified medical expenses.

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