Individual Coverage Health Reimbursement Arrangement FAQs
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What is an Individual Coverage Health Reimbursement Arrangement (ICHRA)?
An Individual Coverage HRA (ICHRA) allows employers of any size to designate funds that employees can access tax-free to reimburse the cost of their individual health insurance premiums (including Medicare), as well as out of pocket medical, dental and vision expenses. Qualified expenses are determined by the employer.
How is an ICHRA funded?
ICHRAs are funded by your employer only, so there is no cost to you. Your employer will determine the amount available for reimbursement under the plan and what expenses qualify for reimbursement.
Do I pay taxes on my ICHRA reimbursements?
No, ICHRA reimbursements are not considered to be income and are not taxable to you.
Who is eligible to participate in an ICHRA?
Benefit eligible employees covered under an individual health plan.
What expenses are eligible for reimbursement under an ICHRA?
Individual health insurance premiums (including Medicare), as well as out of pocket medical, dental and vision expenses are eligible. These eligible expenses are determined by your employer. Plan information is provided by your employer during the open enrollment period.
How do I file a claim for reimbursement?
Claims and supporting documentation can be submitted by the following methods:
- Mobile phone app
How and when will I receive reimbursements?
Reimbursements are received through direct deposit or via a check in the mail. Check your employer’s plan design features to see which options are available to you.
What supporting documentation needs to be submitted with my claim for insurance premiums?
Please only submit copies of documentation and keep the originals for your records. Submit the premium statement or bill showing the following:
- Subscriber Name
- Provider of Coverage
- Premium Amount
- Coverage Period
What supporting documentation needs to be submitted with my claim for out of pocket medical/dental/vision expenses (if deemed eligible by your employer’s plan)?
Please only submit copies of documentation and keep the originals for your records. Most plans require that an Explanation of Benefits (EOBs) be submitted with your claim. EOB's can usually be obtained from your insurance carrier or your insurance carrier's website. They contain all of the information needed to process your claim. If the eligible expense is not processed through insurance and therefore does not have an EOB, documentation must contain the following:
- Date of service (this is different from the statement or transaction date)
- Patient Name
- Provider of Service
- Type of service or explanation of service
- Your out of pocket expense (after insurance has paid, if applicable)
What is a run-out period?
The run-out period is the period of time that you have after the end of the plan year to submit claims for expenses incurred during the plan year.
What happens to the funds if I leave my employer?
ICHRAs are an employer owned arrangement, so money remaining in the account does not go with you if you leave employment. You do have a termination run-out period which is a period of time to submit claims for expenses incurred prior to your termination date.
I have a Flexible Spending Account. Can I still have an ICHRA?
Yes, you are allowed to be in both plans, but you cannot be reimbursed from both plans for the same expense. The ICHRA can reimburse out-of-pocket expenses that are not covered by another plan.
I am contributing to a Health Savings Account. Can I still have an ICHRA?
This depends on your employer’s plan design. In order to remain HSA qualified, the ICHRA must not have any first dollar coverage for out of pocket medical expenses. Check your employer’s plan design to see if your ICHRA qualifies.
How can I view my account information?
Once you are enrolled in the ICHRA, you have access to your account information through the DBS online account viewing system.