ICHRA Employee Classes & Meanings
A quick tutorial on ICHRA classes. Here’s what you need to know…
Now more than ever, organizations of all sizes are looking for simple and affordable health benefits.
Organizations are increasingly interested in using Individual Coverage Health Reimbursement Arrangements (ICHRAs) for employee benefits. One of the key reasons ICHRA plans are being adopted is that they are not all-or-nothing propositions. Rather, employers are able to only make certain types of employees eligible for the plans by leveraging different ICHRA employee classes.
It’s important to understand each ICHRA employee class and meaning, but first we need to understand eligibility. Employers can use ICHRA plans in lieu of group health plans or in combination with them, provided two key parameters are met to determine each employee’s ICHRA eligibility:
Employees who participate in the plan must be signed up for either individual health coverage or a Medicare plan, as must be true of their spouses and dependents.
Employers must only restrict eligibility based on specific staff groupings, officially called employee classes.