As gig work increases, ICHRAs might be the future of healthcare benefits
By Amanda Schiavo | Originally posted on EBN
The healthcare industry has taken a hit since COVID-19 caused a tidal wave of layoffs, resulting in the loss of health insurance for employees across the country.
To make ends meet, plenty of those workers took on gig work, which can provide a paycheck but rarely comes with employer-sponsored benefits. But employers can still support these limited-time employees through an individual coverage health reimbursement arrangement (ICHRA). ICHRAs allow employers to give tax-free reimbursements for insurance premiums and other medical expenses to employees that enroll in a health plan through the individual marketplace.
It sounds like a simple solution, but ICHRAs come with administrative burdens that often deter employers from offering them, and keep employees from utilizing them. Echo Health, an electronic healthcare payment solutions provider, launched a new premium payment manager tool in September, hoping to relieve some of the headaches that can come with offering an ICHRA.
“We take care of the administrative hassle of paying the premiums so that employers and employees can enjoy the benefits of ICHRA,” says Tom Dean, president of Echo. “We simplify the process so that we can easily work with any benefits administrator that is helping employees enroll for ICHRA plans.”
In a recent interview with Employee Benefit News, Dean shared his thoughts on the value of ICHRAs, the challenges employers can face when implementing them, and how their solution is designed to help.
How can an ICHRA benefit help gig workers?
ICHRA is something the government instituted to allow employers to offer all or some of their employees healthcare benefits. But it is done in terms of a defined contribution, meaning that they allow the employee to go out onto the Affordable Care Act exchange and pick the health plan that works best for them, and then the employer says they will pay up to X-dollars per month of the premium associated with that plan.