ICHRA-to-ICHRA transition: risks of transitioning during National Open Enrollment

Transitioning a group from another ICHRA administrator to benefitbay is a process that involves several risks, depending on the time of year that the transition takes place.

Specifically, there are multiple risks involved in transitioning ICHRA administration during National Open Enrollment (November/December enrollment for January 1 coverage). It's important to be aware of these risks in order to effectively advise and advocate for your clients. 

Risk: Dual enrollment

To change Agent of Record (AOR) at National Open Enrollment (NOE), many carriers require a new application. The new application doesn’t always override the old application and results in the employee being dual enrolled. This puts the employer at risk to pay double premiums and the employee at risk of having claims on the old coverage. 

If the employee wishes to stay with the same carrier, but make a plan change, there is a further risk of dual enrollment. The benefitbay team can’t submit plan changes directly with the carrier, as our team does not have AOR. Our team is only able to submit a new application, which carries the risk of dual enrollment. Often, employees will need to work with our team to correct the carrier on a 3-way call.  

Risk: Cancellation of new application  

As previously stated, changing AOR at NOE often requires a new application. If the employee is selecting the same carrier and calls to cancel the previous year's plan, the carrier may cancel the new application as well.  

Risk: Payment issues 

NOE is the busiest time of year for carriers. Carriers will often make mistakes: they may not realize the employee has a prior policy with the old ICHRA adminstrator and a new policy with benefitbay. This results in carriers drafting duplicate payments. They may not move the employee over to benefitbay until February or March of the new plan year. Carriers will not provide the benefitbay team with information on the duplicate payments at the time of the payment. This can cause the employer’s ARC Account to overdraft and impact reconciliation processes for the first few months.  

Risk: On-Exchange Plan Changes  

If the prior ICHRA TPA enrolled an employee in an on-exchange (Marketplace) policy and the employee renews the same plan during the NOE, the employee will be required to stay on that plan throughout the coverage year, unless they have a qualifying life event (QLE). During the following renewal next year, the employee will be required to call the exchange and cancel the plan. This is a very sensitive timeline as any new applications must be sent exactly one week later to enroll in the new off-exchange plan.

Risk: Carrier assistance  

We have several strategic partnerships with carriers throughout the nation. Throughout the year, they have the availability to assist us with large bulk changes to AOR and payments. During NOE, due to normal enrollment volume, there can be a delay in processing all the changes.  

Due to the above risks, benefitbay always advises ICHRA-to-ICHRA clients to transition to benefitbay during the plan year, rather than during National Open Enrollment.

Reach out to your Customer Success Manager to discuss your employer clients who are ready for a new ICHRA administrator!