Individual Coverage HRA (ICHRA)

Now, more than ever, healthcare dollars need to go further.

With an ICHRA you can.

Through an Individual Coverage Health Reimbursement Arrangement (ICHRA), employees receive tax-free money from their employer, and can make pre-tax payroll contributions to cover individual health insurance premiums, Medicare premiums and qualified 213(d) medical expenses that the employer money does not cover.

What is an Individual Coverage Health Reimbursement Arrangement (ICHRA)?

An ICHRA is a program that is funded by the employer and an employee can use before-tax dollars in their ICHRA to reimburse themself for the cost of purchasing individual health insurance.

That means the employer dollars contributed to the ICHRA are tax deductible and employees can enjoy tax savings and increased take-home pay through pre-tax payroll deductions. While ICHRAs allow for employers to design the plan in many varieties, the ICHRA allows employees to use the funds for an array of eligible expenses.
How It Works

The employer and the employee can put money into the ICHRA to pay for their individual policy premium. Because the money contributed by the employer doesn’t count as income, there are no tax implications. Employees can use the money in the ICHRA throughout the year for premiums and if allowed for eligible expenses. Depending on your plan design, any leftover dollars may roll over from year-to-year (as long as you continue to be a member of the plan) or they may be forfeited. Check with us for more information about your plan design options.

ICHRA dollars can be used to pay for expenses like (subject to employer design):

  • Individual Health Insurance Premiums
  • Out of Pocket Expenses
  • Medicare premiums Part A, B, C and D, Medicare Supplement premiums
    • Routine health care: office visits, X-rays, lab work
    • Hospital expenses: room and board, surgery
    • Medications: prescription and over-the-counter (OTC) drugs when prescribed by a physician
    • Dental care: cleanings, fillings, crowns
    • Vision care: eye exams, glasses, contacts
    • Copays and coinsurance (the portions of health care bills paid by you)
    • Eligible over-the-counter (OTC) items such as: First Aid Dressings and Supplies –bandages, rubbing alcohol
    • Contact Lens Solutions/Supplies
    • Diagnostic Products like thermometers, blood pressure monitors, cholesterol testing
    • Insulin and Diabetic Testing Supplies
    • Qualified 213(d) medical expenses

MEDSURETY ICHRA PROCESS

MEDSURETY assists employers with ICHRA plan design and purchasing of health Insurance for employees if needed. Our individual insurance partner Shoreline Insurance Group specializes in individual and Medicare policies.

1       Employer decides:

  • Who is eligible to participate
  • Contribution amount
  • What expenses are eligible

2       MEDSURETY provides:

  • Model notice
  • Plan documents and cafeteria plan document

3       Employer provides:

  • Completed Employer Intake Guide
  • Completed employee template with employee email, phone number, demographic, contribution and election information

4      Employee Completes:

  • The ICHRA enrollment and /or payroll deduction election form

5       MEDSURETY assists employees with purchasing healthcare policy through Shoreline Insurance Group

6       MEDSURETY MANAGES:

  • ICHRA contribution amounts
  • Employer and Employee payroll deductions

7       Employees attest to having individual health insurance by submitting proof of purchase to MEDSURETY:

  • Via mobile app, snap picture and upload to account
  • Scan and send via secure email to MEDSURETY
  • Fax

8       MEDSURETY reviews and reimburse employee’s premiums or pays carriers

9       Employee pays their insurance carrier

EMPLOYEE INDIVIDUAL COVERAGE ENROLLMENT PROCESS

  1. Employee receives Welcome Email and submits online Application Request Form. The online form requests all the necessary info needed to put together health plan recommendations for the employee, and their dependents.
  2. Within 24 hours of completing the application, the employee will receive a tailored plan from Shoreline. The plan will have recommendations that best suit employee indicated needs and provide health plan options.
  3. Employee discusses recommendations with Shoreline Crew to address questions and make a final health plan selection. Shoreline is available to answer questions related to employee policy selection and help review plans each year during the Open Enrollment Period.
  4. Employee completes and submits application for selected carrier with assistance from the Shoreline Crew.
  5. Employee pays health plan premium.  Note: Some insurance carriers will require payment with the application while others will send an invoice once enrollment has been processed.
  6. Shoreline provides proof of coverage to Medsurety for ICHRA reimbursement

Contact us to learn more about our ICHRA Administration.

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