Having analyzed scores of possible ICHRAs for employers since late 2019, we have found that approximately 40% make sound financial sense. Our experience, from the dozens of companies we have implemented or are currently implementing, has taught us that a successful ICHRA rollout relies on three major areas:
1. Strategy/design and compliance: Analyze and design a plan that is right for organizational financial goals and culture, including providing the necessary model notices and legal documents to ensure compliance.
2. Employee engagement and enrollment: An education, communication and rollout strategy are paramount to a positive experience. Employers need to provide opportunities to have individual health insurance specialists meet one-on-one with employees to assist them in making informed individual health insurance decisions.
3. Administration: From the initiation and communication of the program to the management and delivery of monthly employee reimbursements, the new program comes with a host of new administrative functions, all of which must be handled systematically.
If we have learned anything about the health insurance industry over the past decade, it is that things change and they change quickly. The ICHRA regulations allow an opportunity for those seeking a path to defined contribution and a path for those who seek to get out of the annual health renewal game.
Is ICHRA a health insurance game- changer? While the final answer will require time, all indications are that the answer for many will be yes.
Spinelli is vice president, director of affinity groups and emerging markets, for Oswald Cos.