We have a group of 50+ employees, restaurant workers, that has offered a health plan for the past year. They have decided to terminate the group health plan and offer an ICHRA program for their employees. Can you outline the compliance responsibilities for the employer that makes this type of change? How will the group be impacted by ACA in the future regarding 1095/1094 reporting?
Employees must be enrolled in their own medical plan to use funds in their ICHRA. The ICHRA money can then be used for premiums, co-pays and deductibles. There are no minimum or maximum contribution amounts, and employers of any size can have an ICHRA.
An ICHRA is considered “affordable” if the premium the employee would pay (after using the ICHRA money to cover premiums) for the lowest cost silver plan in their Marketplace is less than 9.12% of the employee’s household income.
Employees can pay their premiums through a cafeteria plan. HealthCare.gov has a good resource on ICHRAs and Thomson Reuters has an article on 1094 reporting for ICHRAs.