What Is ICHRA?



ICHRA (pronounced like “ick-rah) stands for Individual Coverage Health Reimbursement Arrangement.

Announced in 2019, ICHRA is the newest type of HRA and it allows employers to provide different reimbursement amounts to multiple classes of employees (i.e., full-time and part-time employees or employees in different states). Employees can then buy individual health plans in their own markets and submit claims for reimbursement of healthcare expenses. Employers get to keep any reimbursement funds that aren’t used.

In general, ICHRAs are ideal for employers that plan to grow beyond the 50-employee threshold, that wish to provide higher limits than those allowed by QSEHRAs, that want to provide dental and vision benefits in addition to health benefits, and/or that want to offer a group health plan in addition to their reimbursement plan.

Watch the next video for a side-by-side comparison between QSEHRAs and ICHRAs, or explore the resources below for more information:

HRAs: The Alternative to Group Health Plans for Small Employers

CEDR’s Employee Health Benefits Guide

QSEHRA vs ICHRA: A Side-by-Side Comparison

CEDR’s Trusted HRA Partner: Take Command Health

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Aug 17, 2022

Friendly Disclaimer: This information is general in nature and is not intended to provide legal advice or replace individual guidance about a specific issue with an attorney or HR expert. The information on this page is general human resources guidance based on applicable local, state and/or federal U.S. employment law that is believed to be current as of the date of publication. Note that CEDR is not a law firm, and as the law is always changing, you should consult with a qualified attorney or HR expert who is familiar with all of the facts of your situation before making a decision about any human resources or employment law matter.

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