ICHRA in Florida: A Smarter Way to Offer Health Benefits

What Is ICHRA, and Why Are Florida Employers Paying Attention?

An Individual Coverage Health Reimbursement Arrangement (ICHRA) lets a business of any size give employees a set amount of tax-free money to spend on their own individual health insurance. Instead of locking everyone into a single group plan, the employer decides the budget and each employee picks the coverage that actually fits their life.

For a lot of Florida business owners, that flexibility solves a problem that’s been getting worse every year: group health premiums that climb no matter what, on a plan that never quite fits everyone on the team. ICHRA flips the model. Employers gain predictable costs, employees gain real choice, and larger employers get a clean path to ACA compliance.

At BrightBridge Insurance, we help Florida employers design and launch ICHRA programs, and just as importantly, we help their employees navigate the individual market and enroll in the right plan. That second part is where a lot of ICHRA setups fall apart, and it’s exactly where a local agency makes the difference.

A Quick History: How ICHRA Came to Be

For years, employers used Health Reimbursement Arrangements (HRAs) to help cover their team’s medical costs alongside a group plan. When the Affordable Care Act arrived, it sharply limited how businesses could use HRAs toward individual coverage. The QSEHRA, introduced for small employers, eased some of those restrictions but left plenty of gaps, and employees were still largely stuck with one-size-fits-all group plans.

In 2017, federal agencies (the Departments of Treasury, Labor, and Health and Human Services) set out to expand how businesses could use HRAs again. After roughly two years of rulemaking, ICHRA officially became available to employers of all sizes starting January 1, 2020. It remains one of the most significant changes to employer health benefits in decades.

Is ICHRA Right for Your Florida Business?

If you’re an employer in Florida, you can offer an ICHRA. Full stop. It works for a company with a handful of employees and for organizations with thousands. There’s no minimum participation requirement and no cap or floor on what you contribute.

Here’s the basic flow:

1. You decide how much to reimburse, and you can set different amounts for different classes of employees.
2. Each eligible employee shops for and buys an individual health plan that fits their needs.
3. Employees submit proof of their premiums and any eligible expenses.
4. You reimburse them, tax-free, up to the amount you set.

Any employee enrolled in a qualifying individual health plan (or Medicare) is eligible, as long as their class is included in the ICHRA you design. That’s the whole engine. You control the cost; your team controls the choice.

Who Benefits From an ICHRA?

Across Florida, ICHRA gives employers a level of control over benefits we’ve never really had before, while giving employees freedom that traditional group plans simply can’t match. Here’s where it delivers:

Flexibility. You set a contribution that fits your company’s budget and goals, with no caps or minimums to worry about. You choose which employee classes to include. Your team shops every individual plan available in their area and enrolls in the one that fits their needs and their wallet.

Recruiting and retention. Benefits are one of the first things strong candidates look at. Offering a plan that genuinely meets each person’s needs usually costs a fortune through traditional group insurance, but ICHRA lets you give that kind of personalized benefit without the runaway price tag. Every employee is different. ICHRA lets your benefit reflect that.

Cost control. With ICHRA, you’re in the driver’s seat. You decide what benefits cost your business, down to the dollar. In a market where annual premium hikes are the norm, that kind of predictability is rare and valuable.

ACA compliance. For Applicable Large Employers, an affordable ICHRA can satisfy the ACA’s Employer Mandate. As long as the affordability requirements are met, simply offering the ICHRA meets the mandate, whether or not employees enroll in it. Not sure if you’re an ALE? We’ll help you figure it out.

Tax savings. Money flowing through an ICHRA is 100% tax-free. Employer contributions are exempt from payroll taxes and tax-deductible, and employees can pay their share of premiums on a pre-tax basis. The net effect: an individual policy can effectively be paid for entirely with tax-free dollars.

Simpler administration. Traditional benefits administration can eat up real time and staff. An ICHRA can be run internally or handed off to a compliant third-party administrator. BrightBridge can walk you through both paths and help you decide what makes sense for your size and resources.

How ICHRA Works, Step by Step

We keep the process straightforward:

1. Design the plan. Together we set reimbursement amounts, define eligibility, choose employee classes, and map out enrollment.
2. Employees choose coverage. Each eligible employee shops for and enrolls in an individual plan suited to their personal and family needs, with our help if they want it.
3. Submit claims. Employees provide proof of their premiums and any eligible expenses.
4. Get reimbursed. Each approved claim is reimbursed, tax-free, up to the set amount.

Understanding ICHRA Employee Classes

One of ICHRA’s most powerful features is the ability to offer different reimbursement amounts to different groups of employees. These groups are called “classes,” and the rules define which ones you can use. Common classes include:

• Full-time and part-time employees
• Salaried and non-salaried workers
• Seasonal or temporary staff
• Employees in the same geographic rating area
• Employees still within a coverage waiting period

You can also combine two or more approved classes. The class structure is what lets you build an offer that works for the whole organization while still tailoring contributions where it makes sense, for example, contributing more for full-time staff than seasonal hires.

Enrollment: Annual and Mid-Year

To participate in an ICHRA in Florida, employees need coverage through an individual health plan. Qualifying options include on-exchange or off-exchange individual coverage, Medicare Parts A and B, or Medicare Part C.

Individual coverage is generally purchased during the annual Open Enrollment window. Outside that period, certain life events trigger a Special Enrollment Period, things like getting married, having a baby, or moving. Importantly, becoming newly eligible for an ICHRA also triggers a Special Enrollment Period. So a new hire who becomes eligible mid-year can enroll in an individual plan right away, and existing participants can change plans during Open Enrollment.

One detail worth knowing: employers offering an ICHRA must give employees the chance to opt out. Opting out lets an employee claim premium tax credits through the exchange instead of taking the employer’s reimbursement. (An employee can’t do both, more on that below.)

Is ICHRA Insurance?

No. ICHRA is not insurance. When you offer an ICHRA, you’re making a promise to reimburse employees a set amount toward the cost of their own individual coverage. It’s best understood as an alternative to group insurance, not a policy itself.

That’s exactly why working with a licensed Florida agent matters. Employees still need to choose and buy an actual individual policy, weighing premiums, deductibles, networks, HSA eligibility, and more. BrightBridge helps your team navigate those choices so their coverage finally fits their needs, not the average of everyone’s.

Why Work With BrightBridge Insurance?

ICHRA only works as well as the individual coverage behind it. As a local Florida agency, BrightBridge bridges both sides of the equation: we help employers structure a compliant, cost-effective ICHRA, and we guide employees through shopping for and enrolling in the right individual plan. You get a benefit your team actually values, without the administrative headaches or the guesswork.

Ready to Explore ICHRA for Your Business?

Let’s talk about whether ICHRA is the right fit for your Florida company. Contact BrightBridge Insurance today to start the conversation.

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Frequently Asked Questions About ICHRA in Florida

What does ICHRA stand for?
ICHRA stands for Individual Coverage Health Reimbursement Arrangement. It’s a federally approved arrangement, available since 2020, that lets employers reimburse employees tax-free for individual health insurance premiums and certain medical expenses.

Who can offer an ICHRA?
Any employer, of any size and in any industry, can offer an ICHRA. There’s no minimum number of employees required.

Is ICHRA the same as insurance?
No. ICHRA is a reimbursement arrangement, not an insurance policy. Employees must enroll in their own qualifying individual health plan (or Medicare) to participate.

What can an ICHRA reimburse?
At minimum, individual health insurance premiums. Employers can also choose to reimburse certain out-of-pocket medical expenses like deductibles and copays. The exact design is up to you, within the compliance rules.

Does ICHRA have participation minimums?
No. Unlike traditional group plans, ICHRA has no minimum participation requirement. You can offer it even if only a few employees take it.

Are there contribution limits?
No. ICHRA does not set a maximum or minimum contribution. You decide the amount that fits your budget. (This is one of the key differences from QSEHRA, which does have annual limits.)

Can an Applicable Large Employer offer ICHRA?
Yes. If the ICHRA meets affordability requirements, it counts as an offer of coverage that satisfies both the Minimum Value and affordability pieces of the ACA Employer Mandate.

What’s the difference between ICHRA and QSEHRA?
ICHRA is available to employers of any size and allows different reimbursement amounts across employee classes. QSEHRA is limited to employers with fewer than 50 employees, requires the same reimbursement for all (with some age and family-size adjustments), and has annual contribution caps. ICHRA does not.

Can an ICHRA reimburse Medicare premiums?
Yes. An ICHRA can reimburse Medicare premiums, including Part A (if applicable), Part B, Part C (Medicare Advantage), and Part D.

Can employees still use the marketplace and get tax credits?
Employees can buy a marketplace plan, but they generally can’t both accept the ICHRA and claim premium tax credits. If the ICHRA is considered affordable, they typically won’t be eligible for credits. That’s why the opt-out option matters, and why it’s worth talking through each employee’s situation.

If I hire someone mid-year, do they have to wait until January?
No. Becoming eligible for an ICHRA creates a Special Enrollment Period, so new hires can enroll in individual coverage as soon as they’re eligible, based on your waiting period. Carriers usually need a copy of the ICHRA notice and the employee’s eligibility date to process the enrollment.

What does an employer need to set up an ICHRA?
An ICHRA is an ERISA plan, so it comes with compliance requirements, including formal plan documents, required employee notices, and adherence to non-discrimination rules. Many employers use a third-party administrator to handle documentation and reimbursements. BrightBridge can help you understand your obligations and connect the right pieces.

What does an employee need to participate?
Enrollment in a qualifying ACA-compliant individual plan (Bronze, Silver, Gold, or Platinum) or Medicare, plus proof of coverage to receive reimbursements.