GROUP HEALTH INSURANCE IS EXPENSIVE!
ICHRA – The Solution to Expensive Group Health Insurance.
It Saves Employers and Employees money on healthcare costs.
It Saves Employers and Employees money on healthcare costs.
What is ICHRA (Individual Coverage Health Reimbursement Arrangements) – it allows employers to better control their healthcare spending and typically saves employers at least 35% over group health insurance plans.
ICHRA provides more flexibility for controlling healthcare spending and allows employers to stay ACA compliant (including satisfying the ACA employer mandate for companies with 50+ full-time employees) at the same time.
How this happens:
The company chooses the level of reimbursement allowance for eligible employees. The reimbursement amount can vary based on different classes of employees as well as differences in family status and age.
Each employee is enrolled in an ACA compliant health insurance plan (or Medicare if employee is eligible).
Employees are reimbursed for monthly premiums and/or other allowable medical out of pocket expenses (based on pre-set reimbursement levels). There are 3 reimbursement options available based on how much employer wants to contribute:
ICHRA solves the problem many low paid employees face…being unable to afford to participate in high-cost group insurance plans and not being eligible for premium tax credits for ACA plans. This makes it possible for low paid employees to qualify for low premium, tax subsidized ACA plans that are now affordable for employee and their family.
ICHRA IS A WIN-WIN FOR EMPLOYERS AND EMPLOYEES
ICHRA provides more flexibility for controlling healthcare spending and allows employers to stay ACA compliant (including satisfying the ACA employer mandate for companies with 50+ full-time employees) at the same time.
How this happens:
The company chooses the level of reimbursement allowance for eligible employees. The reimbursement amount can vary based on different classes of employees as well as differences in family status and age.
Each employee is enrolled in an ACA compliant health insurance plan (or Medicare if employee is eligible).
Employees are reimbursed for monthly premiums and/or other allowable medical out of pocket expenses (based on pre-set reimbursement levels). There are 3 reimbursement options available based on how much employer wants to contribute:
- Premium only reimbursement (as much or as little as employer wants to contribute)
- Partial premium reimbursement plus pre-tax deduction for employee premium contribution
- Partial premium reimbursement, pre-tax employee premium contribution and medical expense reimbursements (as much or as little as employer wants to contribute)
ICHRA solves the problem many low paid employees face…being unable to afford to participate in high-cost group insurance plans and not being eligible for premium tax credits for ACA plans. This makes it possible for low paid employees to qualify for low premium, tax subsidized ACA plans that are now affordable for employee and their family.
ICHRA IS A WIN-WIN FOR EMPLOYERS AND EMPLOYEES
New Level-Funded Group Plan now available in Texas can save your business 20-30%. Level-Funded plans combine the cost control and savings of Self-Funded plans with the simplicity and protection of Fully-Insured Plans.
Level-funded plans can offer the best of both worlds by combining the cost control and savings of self-funded plans with the cost certainty of fully-funded plans. The premiums are based on an assumed maximum liability for the year and are collected as level premiums throughout the plan year, thereby providing cost certainty for the group.
Where level-funded plans offer their greatest savings and benefits are in two primary areas. The rates are based on “group rating” as opposed to the more common “community rating”. With a better idea of the overall health of the group, the insurance carrier can more accurately “predict” the possible claims for the upcoming plan year and if the group is relatively healthy, can set a lower premium rate. The carrier also sets aside a portion of the monthly premiums into a “claims bucket”. At the end of each year, if claims amounts are lower than projected, the carrier will split the remaining amount in the claims bucket with the company, thereby lowering the overall cost to the company even more. If the claims are higher than expected, then stop loss insurance provides maximum claim protection and no additional savings.
For smaller and healthier groups, a premium savings of 20% - 30% is fairly common for companies. This will allow companies to lower their group plan costs without raising employee deductibles.
Where level-funded plans offer their greatest savings and benefits are in two primary areas. The rates are based on “group rating” as opposed to the more common “community rating”. With a better idea of the overall health of the group, the insurance carrier can more accurately “predict” the possible claims for the upcoming plan year and if the group is relatively healthy, can set a lower premium rate. The carrier also sets aside a portion of the monthly premiums into a “claims bucket”. At the end of each year, if claims amounts are lower than projected, the carrier will split the remaining amount in the claims bucket with the company, thereby lowering the overall cost to the company even more. If the claims are higher than expected, then stop loss insurance provides maximum claim protection and no additional savings.
For smaller and healthier groups, a premium savings of 20% - 30% is fairly common for companies. This will allow companies to lower their group plan costs without raising employee deductibles.
HAVE EMPLOYEES OVER AGE 65 AND STILL ON EMPLOYER GROUP PLAN?
Save money with Employer-sponsored Medicare Supplement (Not available in WA, NY, FL or MD)
1. Designed to cover most out-of-pocket expenses approved but not paid in full by Medicare.
2. Enroll Year-round.
3. Guaranteed issue and guaranteed renewable.
4. No Networks - See ANY doctor that accepts Medicare.
5. Sponsoring entity (Business, Union, Municipality etc) can fully deduct monthly premiums (or can be paid by member).
6. Fully portable. Member can keep plan after retiring and leaving company.
7. Group size as small as one member.
8. Removing employees over age 65 from group health plan will lower group plan premiums.
1. Designed to cover most out-of-pocket expenses approved but not paid in full by Medicare.
2. Enroll Year-round.
3. Guaranteed issue and guaranteed renewable.
4. No Networks - See ANY doctor that accepts Medicare.
5. Sponsoring entity (Business, Union, Municipality etc) can fully deduct monthly premiums (or can be paid by member).
6. Fully portable. Member can keep plan after retiring and leaving company.
7. Group size as small as one member.
8. Removing employees over age 65 from group health plan will lower group plan premiums.