ICHRA Compliance 2025: What Every Broker Should Know

Mark Mixer has spent over 40 years helping businesses and brokers navigate the complex world of employee benefits. As CEO of HRASimple, a founding member of the HRA Council, and a certified NABIP trainer, he’s a trusted guide for brokers looking to offer smarter, more human-first health plans. Mark writes to equip advisors with strategy, not just sales tools, so they can lead their clients with confidence.

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Table of Contents

• Compliance Acronym Cheat Sheet
• Where Brokers Get Burned on Compliance
• How to Choose the Right ICHRA Administrator

Let’s be honest. Compliance isn’t sexy. It doesn’t sell policies or win awards. But if you’re a broker advising clients on ICHRAs or any health plan, compliance is the silent engine behind everything that works — and everything that doesn’t.

I’ve been in this industry for over 40 years. And one truth remains constant: when compliance breaks, trust follows.

Why Compliance Matters in Insurance More Than Ever

In the world of employer-sponsored benefits, the rules have changed. Health insurance isn’t just about the right price or carrier anymore. It’s about personalization, predictability, and above all, precision.

ICHRA (Individual Coverage Health Reimbursement Arrangement) is one of the most powerful tools in a group benefits broker’s toolkit right now. But with great flexibility comes high stakes. ICHRA isn’t traditional group coverage. It’s a reimbursement model governed by ERISA, HIPAA, IRS, DOL, and more. One missed step? One unclear notice? That’s not just a mistake. It’s a liability.

Group Benefits Compliance 101

Here is your compliance acronym cheat sheet to help lead your conversations and strategically advise and educate clients:

ERISA

Think: The Rules Referee

The Employee Retirement Income Security Act, or most commonly referred to as ERISA, is the federal playbook for running benefits fairly. It says: “Tell your employees what the plan covers, treat their money like it’s yours, and follow the process.” Skip it, and the ref (a.k.a. Department of Labor) will blow the whistle.

HIPAA

Think: Vegas Rules for Health Info

What happens in your medical file stays in your medical file. Health Insurance Portability and Accountability Act, or HIPAA, makes sure health information is kept private, safe, and shared only with people who need to know. Yes, that includes not blabbing about an employee’s diagnosis in the break room.

IRS

Think: The Tax Gatekeeper

The IRS decides what’s tax-free and what’s taxable in your health plan. They’re cool with HRAs and ICHRAs, but only if you follow their rules on reimbursements, reporting, and record-keeping. Otherwise, hello, tax bill.

DOL

Think: Compliance Cop

The Department of Labor enforces ERISA. They’re the ones making sure you play fair, keep good records, and don’t forget the boring-but-crucial compliance stuff, like giving employees the right notices at the right time.

CMS

Think: The Health Boss

The Centers for Medicare and Medicaid Services (CMS) makes sure your plan lines up with the Affordable Care Act. They’re watching for things like essential health benefits and preventive care coverage. For large employers, the guardrails are tighter. 

If you remember nothing else:

• ERISA = Follow the playbook
• HIPAA = Guard the secrets
• IRS = Keep the taxman happy
• DOL = Respect the rule enforcer
• CMS = Play nice with the ACA

Where Brokers Get Burned on Compliance (& How to Help Your Clients Avoid It)

1. Onboarding Mistakes

Missing a required notice or skipping eligibility verification? You just lit a slow-motion compliance firework. ICHRAs require that employers communicate clearly, timely, and in writing. If your client doesn’t have a process in place, they’re exposed, and so are you.

2. Billing Chaos

A late payment or an unprocessed QLE doesn’t just mess up payments, it breaks trust. Your ICHRA administrator should have vigilant measures built in, like a billing safety net that treats every change as a compliance risk, not just a data entry task. Brokers should demand this level of compliance from their partners.

3. Reporting That Actually Proves Something

Sending reports isn’t the same as tracking audit trails, reimbursements, status changes, and documentation. Your clients need more than data. They need protection. They need proof.

4. Reimbursement Errors

That one missed $30 reimbursement? Multiply it across 30 employees and a few Glassdoor reviews. Now it’s a reputational problem. With ICHRAs, intent is not a defense — systems are.

Compliance is not a feature — it’s a service.

Let’s make one thing clear: if your ICHRA administrator isn’t treating compliance like the backbone of the plan, then they’re just gambling with your reputation.

Smart brokers are shifting from being reactionary to becoming strategic advisors. That means moving away from vendors who “check the boxes” and toward partners who actually own the process. They’re becoming those who spot mistakes before HR or the CFO does.

This isn’t just about helping clients survive. It’s about helping them thrive. Especially in a world where healthcare costs are expected to rise 15–25% and traditional plans don’t flex with real employee needs.

Connecting ICHRA With Your Tool

If you’re a broker who is already investing in automation, retention tools, and smart integrations, like AgencyBloc’s solutions, you’ve already taken the first step. You’re using industry-specific tools to build a better agency. Adding ICHRA to your strategy, with the right admin partner, completes the picture.

With a truly compliant ICHRA, your employee benefits agency could:

• Deliver high-impact, low-stress benefits strategies
• Shift from reactive to strategic advising
• Help clients contain costs without sacrificing employee satisfaction
• Stay protected, documented, and audit-ready, every step of the way

Your tech stack already supports smarter service. Now it’s time your benefits approach does, too.

How to Choose the Right ICHRA Administrator

Not all ICHRA administrators are created equal.

Some look great on paper but leave brokers cleaning up the mess when onboarding falls apart or billing mistakes trigger a client’s midnight email meltdown. Others check boxes without offering any real compliance protection, leaving your clients vulnerable (and your reputation on the line).

Here’s what to look for if you want an administrator who helps you lead instead of scrambling:

• Compliance Is Their Core Focus: Your ICHRA administrator should treat compliance like it’s their full-time job — because it is. From ERISA rules to reimbursement protocols, they should anticipate issues before they show up in the CFO’s inbox. If they can't explain how they handle onboarding notices, eligibility tracking, or reporting audits, move on.
• White-Glove Onboarding: First impressions matter. A strong admin partner walks both you and your client through the setup process. If they just drop a tech link and bounce, look elsewhere for your administrator. Look for hands-on support, employee education, and proactive gap detection from day one.
• Real-Time Billing Accuracy: Ask about how they handle mid-month changes, terminations, and QLEs. A good partner won’t just “adjust next month;” they’ll get it right the first time and prove it with documentation.
• Reporting That Actually Proves Something: Anyone can send a report. A great administrator gives you transparency: audit trails, reimbursement timelines, eligibility status logs, and funding confirmations. In a regulated environment, process is the best defense.
• Strategic Partnership, Not a Set-It-and-Forget-It Vendor: Choose a team that acts like an extension of your business — proactive, accountable, and invested in your long-term success.

Your ICHRA administrator should help you manage compliance like it’s their full-time job. You’ve worked hard to build trust with your clients. Don’t let a compliance failure undo it.

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Posted by Mark Mixer on Tuesday, August 19, 2025 in Group Benefits

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