ICHRA is an employer-funded health benefit that is used to reimburse employees for individual health insurance premiums and healthcare expenses. This exciting benefit gives employers a practical option that creates flexibility and maintains employee satisfaction. Why is ICHRA such a big deal? Employers can reimburse employees that do not qualify for Federal subsidies given by the Affordable Care Act and enhanced by the American Rescue Law. With proper plan design, most employees will elect the subsidies for their entire family, so the employer contributes nothing. There are no participation requirements or minimum employer contributions that are part of any group plans. Lastly, the ICHRA allows for a special enrollment event so employers can start a plan any time of the year. Employee Classes Defined The ICHRA comes with 11 different employee classes businesses can leverage while structuring benefit eligibility and allowance amounts. The classes separate employees into groups by job-based criteria that include locations, tenure, hours worked and more. The 11 classes are as follows:

• Full-time employees
• Part-time employees
• Salaried employees
• Hourly employees
• Temporary employees of staffing firms
• Seasonal employees
• Employees covered under a collective bargaining agreement
• Employees in a waiting period
• Foreign employees who work abroad
• Employees in different locations, based on rating areas
• A combination of two or more of the above

An employer can offer a contribution to one class and not another, or they can differ amounts from class to class. For example, they could offer $300 to full-time employees who are single and $600 to full-time employees who have a family. To keep things simple, an employer can even offer the same amount to all classes equally. Age-Based Contributions For age-based contributions, businesses can only offer higher allowances to older employees. The employer must ensure that their older employees would be eligible for a larger amount, but not exceed a certain ratio. For example, the contribution for the oldest employee must be more than that of their youngest co-worker but cannot exceed more than three times the amount. If an employer offers its 18-year-old employee $100 a month, it could only offer the oldest employee up to $300. Eligibility for Employee Classes CLEARING UP THE CONFUSION: The class size requirements ONLY apply for companies offering both group insurance and an ICHRA to different classes. Any employer regardless of size can offer an ICHRA. Employers may want to offer both group health insurance and the ICHRA plan to their employees. If they choose to offer both based on full-time or part-time status, salaried or hourly payment structure, or geographic location, they must ensure their employee classes are of a certain size. This size criterion varies by employer as follows:

• 10 employees for employers with fewer than 100 employees
• 10 percent of the total number of employees for employers with between 100 and 200 employees
• 20 employees for employers with more than 200 employees

Note: This section does not apply with temporary employees, collective bargaining agreements, seasonal employees, foreign nationals or those in a waiting period. More Flexibility Equals Benefits Success With the employee class structure, employers are able to get a little creative with how they want to structure their benefits. They can specifically target highly-valued employees. For most businesses, their full-time employees provide the greatest value, which is why it might make sense for an employer to offer them larger amounts than part-time employees. Employers can also choose to offer different allowance amounts to different employees within each class based on the employee's age and family size. With so many options and flexibility, the ICHRA can be tailored to each business' budget so they can achieve the most desirable outcomes. In conclusion, the ICHRA brings flexibility back to the employer. Structuring employee eligibility based on the defined classes can enable businesses to use the ICHRA to seek out talent more effectively and maintain valuable employees. Flexible plan options such as the ICHRA will help employers achieve benefit success, and that's a win-win for everyone.

The ICHRA law allows a large employer to meet ACA mandated premiums contributions while not excluding an employee's dependents from taking advantage of individual subsides. The law gives small groups a special enrollment event to offer more choice to employees and voluntary options for individual health subsidies. In March 2021, The American Rescue law increased federal subsidies to lower the premiums for individuals not offered group health insurance at work. The law also eliminated the income cliff that restricted premium subsidies for anyone earning over 400% of the Federal Poverty Level. Now any qualified individual will not pay more than 8.5% of their household income for their entire family, and most will pay much less. Many groups want to offer employees savings but are not aware of the rules. The ICHRA law starts a special enrollment event to enroll employees into individual plans at any time of the year. The law allows employers to contribute to their employee's costs and also contribute to their out-of-pocket costs. Employers can offer employees more choice of plans, better network access, and their dependents have full access to health plans with federal and state subsidies to lower their costs. Employers can use classes to segment their employees with different benefits to accommodate management, out-of-state employees, hourly, seasonal, etc., offering employees lower prices and better network access. Every group needs to take the time to learn the benefits and rules, and individuals pay on average $10 a month using individual plans verse group premiums of $300 or more.

New Jersey residents "Not" offered group health insurance through work save even more with state subsidies in addition to improved Federal subsidies. Many bronze-level individual plans have zero premiums. Family premiums can be less than single plans. Families are also given more choice, with each family member able to pick a different network or plan design. The Affordable Care Act income cliff has been removed, and all eligible households never pay more than 8.5% of their household income, and most pay far less. Everyone in NJ needs to learn their cost at https://enroll.getcovered.nj.gov/hix/preeligibility#/ and notify their employer. Similar to the Advance Premium Tax Credit (APTC), New Jersey residents will qualify for new savings based on income. Households with annual incomes up to 600% of the FPL will receive the new and expanded NJHPS. An individual with an income of up to $76,560 and a family of four who makes up to $157,200 can receive state subsidies to lower health coverage costs. Anyone who qualifies will be able to see a lower premium when using our plan comparison tool or after filling out an application. If your employer offers you group health, ask them to learn the detail as they would better serve your interests to cancel the group health and compensate you with better benefits and services. According to the Kaiser Foundation, Independent study in 2019, employers pay 82% of an average $7,188 single premium and 70% of a $20,576 family premium. With these new subsidies, an entire family's health insurance can be less than the 18% an employer asks employees to pay. Most single employees would rather pay $51 a month versus $100 at work, especially if their employer used the employer's premium savings to give more benefits. Small employers should establish a competitive edge against the competition, utilizing open enrollment during the summer to educate employees on the change and implement new benefits and services. Don't waste thousands in savings waiting for your group renewal or look to change when so many others renew year-end. Your employees are learning the truth as GetCoveredNJ bombards residents on the news. Be the first to take off your mask with the law in place and the government's permission to proceed. Employers can take the average $6,000 in employer-paid premium savings and give every employee a defined contribution to purchase benefits and services they want. Don't follow the pack and wait for others to take the lead. Tell your employer to act now as waiting for everyone to take off their mask and following the pack can cost you thousands.