Individual Coverage Health Reimbursement Arrangement (ICHRA)
- ICHRA creates an entirely new health insurance platform compared to the group platform.
- ICHRA’s are highly flexible and targeted to help small businesses afford coverage.
- ICHRA’ require a paradigm shift when thinking about how to provide health coverage to your team.
Three Strategic Advantages of the New Individual Coverage Platform:
1. Maximize the tax treatment for each employee. Something that the group platform simply cannot do. And that is a major shortcoming. A carefully designed ICHRA opens the option for non-highly compensated individuals to receive the Advanced Premium Tax Credit, which can pay up to 80% of the cost of the coverage. The tax credit is “Advanced” every month directly to the insurance company of choice. Highly compensated individuals preserve their pre-tax treatment.
2. The employer offers a fixed dollar “Wellness Bonus” to each employee. This is usually between $5-12 per year of age, per month. Couple the Wellness Bonus with the powerful Advanced Premium Tax Credit and you have built a significant "Benefits Budget," for each employee. The advantage is to then give your employees the freedom to use that Benefits Budget to purchase coverage individualized to their own health care needs. This is how you deliver something that each person values and that is how you attract and retain talented people. It also has the added benefit of delivering exactly the right coverage at exactly the right time for each of your people.
3. Business owners no longer have to run their companies like a mini-insurance company with the insurance carrier passing back the cost of any significant claims to the Employer in the form of higher premiums. With the individual platform, the insurance carrier does not care where the insured works.
OneAdvocate ICHRA Benefit Specialist will:
- Survey all your employees to identify their unique utilization of health care.
- Search for an individual policy that matches the unique needs of each team member.
- Start with the Wellness Bonus, add the significant Advanced Premium Tax Credit to compose each employee’s “Benefit Budget” and goes shopping to find 3-4 good policy options.
- Meets one-on-one (usually over a web meeting) with each employee.
- Help each team member select their unique policy to fit their unique health care needs.
- If the individual needs a Cadillac policy with certain whistles and bells, they can pay the difference from their own pocket. (OneAdvocate will do the math to see if it pays off)
- Each year as their healthcare needs change, each team member can change their policy.
- The employee, not the company, owns their own policy.
To Prepare a Preliminary Analysis, we request the following information:
Overview of the Individual Health Insurance Platform
1. OneAdvocate will survey your employees to understand:
A. What types of health care they utilize, so we can tailor their coverage to their need.
B. Determine household income, so we can determine the Premium Tax Credit.
2. OneAdvocate will then prepare a Study from the survey results we receive from your employees. This will show how much Advanced
Premium Tax Credits your team will receive and therefore determine how much the Individual Insurance Platform will save the Employer and
Employees.
3. From the Study, the we will guide the employer in how much they may pay to each employee, in the form of a Wellness Bonus.
This is a discretionary amount usually between $4.00 - $11.00 per employee year of age, per month and is formally a "stipend."
So a 30 year old may receive $5.00 per year of age or $150 per month.
This is because Individual Insurance is quoted on three simple factors: Age, Zip Code and tobacco use.
Pre-existing conditions do not effect premiums.
4. At that point OneAdvocate knows how much the Advanced Premium Tax Credit will be, plus the amount of the Employer's Wellness Bonus.
5. Your OneAdvocate Benefits Planner will then prepare proposals for each employee giving them at least three policies that best match
the Employee's coverage needs. If the Employee wants a more robust policy, they may pay the difference.
6. The proposals are sent to the employees about a week prior to enrollment. So they can review and discuss it with their spouse.
7. OneAdvocate Benefit Specialist will then meet, one-on-one, usually over web meetings with each employee.
Your Benefit Specialist will answer your employee's questions, and help them choose a policy and then enroll them in that policy.
8. OneAdvocate Client Coordinators are available every business day to answer employee question, in addition all health insurance companies
have solid service departments.
Next Steps...
- In the next few days we will be reaching out to your business owner to introduce him/her to the Individual Platform. (Would you like to be copied on that email?)
- We will ask for permission to have the information listed above sent to us.
- We will follow up with you see if you have any questions regarding the information.
- Once we receive the information, we should have the findings of our preliminary analysis completed in a few days.