Making the Switch to ICHRA: A Step-by-Step Timeline for Employers

If the last four articles have you convinced ICHRA is worth exploring, the next question is usually: “Okay — so how does this actually happen?” Here’s a realistic timeline for switching from a traditional group plan to an ICHRA, from first conversation to first reimbursement.

Step 1: Decide on your contribution structure (4–8 weeks before your target start date)

This is where we start together. We’ll look at:
– Your current group plan cost, so we know what you’re moving away from
– Local individual market premiums in every location you employ people
– Whether you want (or need, if you’re an Applicable Large Employer) to meet the ACA affordability threshold
– How many employee classes make sense for your team

Step 2: Draft your ICHRA plan document

Every ICHRA needs a formal written plan describing eligibility, contribution amounts by class, and reimbursement rules. This is a compliance requirement, not paperwork for its own sake — it’s what protects you if the IRS ever asks how your contributions were determined.

Step 3: Send the required employee notice (at least 90 days before your plan year starts, when possible)

Employees need advance notice of the ICHRA offer, including enough detail that they understand how it affects their eligibility for marketplace subsidies. This notice period is also your best window to start employee education — don’t wait until enrollment week to explain what’s happening.

Step 4: Employee education and enrollment support

This is the step employers most often underestimate. Employees who have never shopped for individual coverage need real guidance: how to compare plans, how the reimbursement process works, and what happens if they don’t act before the individual market’s enrollment window closes. We run this step directly with your team — one-on-one, not just a webinar and a PDF.

Step 5: Employees enroll in individual coverage

Employees select their own plan on or off the marketplace, using your contribution to offset the premium. Timing matters here — individual market enrollment windows are stricter than group enrollment, so this step needs to line up with your ICHRA’s start date.

Step 6: Reimbursement begins

Once employees are enrolled and submit proof of coverage, monthly reimbursement starts, tax-free, up to your set contribution amount.

Step 7: Ongoing — annual review

Affordability thresholds, local premiums, and your own budget all shift year to year. An annual check-in ensures your contribution amounts still make sense for the coming plan year.

Realistic total timeline

Most employers can move from “let’s explore this” to “employees are enrolled and reimbursement has started” in about 60–90 days, assuming you’re not trying to squeeze it into open enrollment week. Starting the conversation a full quarter before your renewal date gives the most breathing room.

Ready to put a real date on this instead of just thinking about it? Schedule a consultation or call (952) 210-9456, and we’ll build your actual timeline together, based on your renewal date.