What happens to my ICHRA if I'm on FMLA?
Here's a breakdown of how these two benefits work together for you:
Let's start with a quick background:
- FMLA (Family and Medical Leave Act) gives eligible employees, including you, up to 12 weeks of unpaid, job-protected leave.
- ICHRA (Individual Coverage Health Reimbursement Arrangement) is a benefit funded by your employer that reimburses you for your individual health insurance premiums and medical costs.
Key Rules to Know for FMLA Leave
Your employer must continue ICHRA contributions during your leave. Just like with a traditional group health plan, employers generally need to maintain an employee's health benefits during FMLA leave. For an ICHRA, this means your employer should continue making the HRA funds available to you at the same monthly amount.
You still pay your share. If you normally pay a part of your individual premium (the amount your ICHRA doesn't cover), you'll still need to pay that portion during your leave, even though it's unpaid.
You must keep your individual insurance active. Since an ICHRA reimburses individual health plans (not group plans), it's up to you to keep your policy active while you're on leave. If your policy lapses, you won't be able to use your ICHRA.
What if you don't return? If you don't come back from FMLA leave, your employer might be able to recover the ICHRA contributions they made during your leave. This is similar to how they'd recover group plan premium payments. An exception applies if you can't return for reasons beyond your control, like a continuing serious health condition.
A Few Important Things to Note
There isn't any direct DOL guidance that specifically covers ICHRA and FMLA together. Because of this, your employer will generally follow the general FMLA rule of "maintaining equivalent benefits" — it's worth checking with them on how they plan to handle it.
Proof is still needed. Even while you're on leave, you'll need to show proof that your individual plan is active and your premiums are being paid in order to get reimbursed.
State leave laws, like California's CFRA or New York's PFL, might have their own set of rules or additional requirements that could apply to you.