Typically, employers may adjust their ICHRA contribution levels at the start of each new plan year. This timing keeps things fair, predictable, and compliant with federal rules. Because an ICHRA is considered a formal health plan, employers can’t simply change contribution amounts whenever they want — doing so mid-year would disrupt coverage, create affordability issues, and violate rules that require all employees in the same class to be treated the same.
Employers may change and update contribution amounts once per year, effective on the first day of the new plan year.
This includes changes to:
- Monthly reimbursement limits
- Class-based contribution structures
- Employer HRA policies (e.g., premium-only vs. premium + medical expenses)
Key requirement: Updated ICHRA notices must be sent to all eligible employees at least 90 days before the beginning of the new plan year, as required by federal rules.
The only time an employer can change contributions outside the annual renewal period is when they introduce a new employee class (for example, adding part-time or remote workers as a separate group). In that situation, the employer can set contribution levels for that new class without affecting existing employees.