Stay compliant with documents and reporting

As an ICHRA plan sponsor, you have certain compliance obligations. Thatch helps you meet these requirements throughout the year.

Plan documents

In the Documents page of your dashboard, Thatch provides all documents necessary to offer an ICHRA. This includes the ICHRA Notice for employees, as well as the ICHRA Adoption Agreement, and the ICHRA Plan Document and Summary Plan Description containing the Section 125 POP Documents for employers.

Note that these documents pertain to the ICHRA plan itself, and not the medical insurance plans your employees select.

Your reporting obligations and how Thatch helps

ICHRAs, like all benefit plans, have certain reporting obligations throughout the year. Employers report ICHRA usage either to the IRS on standard forms or to the relevant agency on the agency's website.

Compliance rule	Deadline	Your obligations	How Thatch helps
Affordable Care Act (ACA) reporting — annual requirement for employers offering health benefits	March 31 to e-file 1094s/1095s with the IRS. Furnish 1095s to employees by early March.	File Forms 1094/1095 with the IRS and distribute Form 1095 to each employee. Use 1094-B/1095-B or 1094-C/1095-C depending on your ALE status.	For all employers, Thatch provides the raw 1095 data necessary to prepare your forms. For employers that choose to file with Thatch, we partner with an ACA reporting vendor to transmit your forms to the IRS and mail 1095s to your employees.
Employee Retirement Income Security Act (ERISA) — Form 5500 filing applies to ICHRAs with more than 100 participants	July 31 for calendar year plans.	File Form 5500 if you had 100 or more ICHRA participants at the start of the plan year. Thatch's ICHRA requires none of the Form 5500 schedules, but you may need schedules for other benefit plans offered outside Thatch.	Surfaces everything you need to complete Form 5500 in your Thatch dashboard. See the Form 5500 Guide.
Patient-Centered Outcomes Research Institute (PCORI) — annual fee on self-funded health plans, including ICHRAs	July 31 to file Form 720 with the IRS.	Pay the annual per-participant PCORI fee and report it on IRS Form 720, Part II, IRS No. 133, as an applicable self-insured health plan.	Reports your ICHRA participant count in your Thatch dashboard to help you calculate the fee. See the PCORI Fee Guide.

Thatch substantiates health expenses

Reimbursements under an ICHRA are a tax deduction for employers and tax-free for employees. The ICHRA rules require that reimbursements be substantiated by a third party in order for the employer and employee to receive tax-free treatment.

Thatch facilitates substantiation in real time by automatically collecting and processing receipts from employees, and requesting resubmission where necessary. Where submissions are insufficient to substantiate a medical expense, reimbursements will be denied or subject to tax.

tip

You do not need to do anything to substantiate employee health expenses; Thatch handles this for you. You can direct any employee questions about eligible expenses to Thatch.

Thatch sends COBRACOBRA A federal law that allows employees to temporarily continue employer-sponsored health insurance after leaving a job, reducing work hours, or experiencing other qualifying events. Employees typically pay the full premium cost plus an administrative fee. notices when directed

Employers who are subject to federal COBRACOBRA A federal law that allows employees to temporarily continue employer-sponsored health insurance after leaving a job, reducing work hours, or experiencing other qualifying events. Employees typically pay the full premium cost plus an administrative fee. are typically those with 20 or more full-time equivalent employees in the prior calendar year. Thatch lets you select whether an employee is COBRACOBRA A federal law that allows employees to temporarily continue employer-sponsored health insurance after leaving a job, reducing work hours, or experiencing other qualifying events. Employees typically pay the full premium cost plus an administrative fee. eligible when you offboard them from their benefits in Thatch.

When you indicate that an employee is COBRACOBRA A federal law that allows employees to temporarily continue employer-sponsored health insurance after leaving a job, reducing work hours, or experiencing other qualifying events. Employees typically pay the full premium cost plus an administrative fee.-eligible, Thatch emails their benefit termination and COBRACOBRA A federal law that allows employees to temporarily continue employer-sponsored health insurance after leaving a job, reducing work hours, or experiencing other qualifying events. Employees typically pay the full premium cost plus an administrative fee. notices on the effective date you select.

Once their health budget ends, the employee is responsible for paying their own insurance premiumspremium The monthly amount paid to maintain health insurance coverage, regardless of whether any services are used that month..

• If the employee elects COBRACOBRA A federal law that allows employees to temporarily continue employer-sponsored health insurance after leaving a job, reducing work hours, or experiencing other qualifying events. Employees typically pay the full premium cost plus an administrative fee., they can request premiumpremium The monthly amount paid to maintain health insurance coverage, regardless of whether any services are used that month. reimbursements from their health budget for the duration of the COBRACOBRA A federal law that allows employees to temporarily continue employer-sponsored health insurance after leaving a job, reducing work hours, or experiencing other qualifying events. Employees typically pay the full premium cost plus an administrative fee. period, as long as they remain enrolled in individual health insurance or other ICHRA-eligible medical plan.
• If the employee declines COBRACOBRA A federal law that allows employees to temporarily continue employer-sponsored health insurance after leaving a job, reducing work hours, or experiencing other qualifying events. Employees typically pay the full premium cost plus an administrative fee., they can still maintain their insurance coverage by paying their health plan premiumspremium The monthly amount paid to maintain health insurance coverage, regardless of whether any services are used that month. directly to the insurance companyinsurance company The company that provides insurance coverage. Also called an insurance provider..

For additional information, see the Thatch guide to COBRA.