Once the ICHRA agreement has been signed, it's now time to request banking to be set up
Requesting Banking Set Up
Once your client has agreed on a contribution strategy and signed the ICHRA agreement, it's now time to order banking. The steps to get banking set up will be completed by your Customer Success Manager. Please email the Customer Success Manager you work with to let them know that the ICHRA agreement has been signed and you need a new bank account set up for your group.
Your Customer Success Manager will be responsible for:
- Ordering a new bank account from the benefitbay finance department
- Defining the initial funding amount
- Creating and sending the ACH form to your clients primary contact to be signed and returned
- Ensuring the completion of the initial funding
The ARC Account must be fully funded three business days before the beginning of Open Enrollment. You should allow five to seven business days to complete this step.
Initial Funding Calculations
We use a specific formula to determine what the initial funding amount should be in order for groups to have enough funds to cover the first month of premiums and add an overdraft protection. Because we don't know yet how many employees will enroll or what plans they'll choose, we want to ensure that the new clients ARC is fully funded to cover the potential costs.
The way we determine the initial funding amount is:
- The cost of the low gold plan for every employee currently enrolled = The total amount needed for premiums.
- If the group doesn't currently offer any benefits, the total needed for premiums is the cost of the gold low for all eligible employees.
- If the group it utilizing subsidies, the total will be the cost of the low gold plan for each employees minus the projected subsidy.
- Then 20% of the total needed for premiums = The overdraft protection amount (unless it is under $1500 then that will be the minimum that'll remain in their account each month)
- Total needed for premiums + overdraft protection amount = Initial Funding Amount
Each subsequent month, benefitbay will pull only what's needed to cover premiums and maintain the overdraft protection. Our finance department will pull money from the employer's business account into their benefitbay master ARC account between the 10th-15th to cover the following months premiums.