How It Works
PremiumRails provides each participant with a dedicated account for premium payments.
The enterprise payment engine built for CHOICE Accounts, formerly ICHRA
As CHOICE Accounts, formerly Individual Coverage Health Reimbursement Accounts (ICHRAs), continue to grow, reliable premium payment infrastructure is essential to keeping coverage in force. PremiumRails is an enterprise payment administration platform built specifically for CHOICE Accounts. It simplifies how employer contributions move to individual health carriers, reducing manual reconciliation, banking workarounds, and unnecessary payment fees.
Instant Accounts
Individual accounts are automatically provisioned with routing and account numbers in real time, with no per-account bank fees or setup paperwork.
Patented Policy ID Embedding
Our proprietary, patented Many-to-Many Affiliation technology embeds the participant’s carrier and plan information directly into the payment transaction, helping payments arrive ready for reconciliation.
Direct ACH Payments
Premiums are paid directly through ACH, helping eliminate unnecessary virtual card processing fees and supporting efficient carrier payment.
Built for Reconciliation
Payment and policy information travels together, reducing the need for manual list-bill matching and spreadsheet reconciliation.
No ZBA Positive Pay Friction
Dedicated participant accounts eliminate the need for zero-balance account structures and help avoid associated Positive Pay hurdles and lower-tier Fed processing delays.
Why PremiumRails?
Traditional CHOICE Account (ICHRA) payment models can require multiple banking accounts, manual reconciliation, virtual card payments, or employee reimbursement. PremiumRails was designed to streamline the process from employer funding through carrier payment.
| Payment Model | How It Works | Common Challenges |
|---|---|---|
| Single ACH + List Bill | Employer funds are aggregated into a carrier-level ACH payment accompanied by a list bill. |
Manual reconciliation, lump-sum payment matching, and potential banking or processing delays. |
| Individual Bank Accounts + ZBAs | Separate bank or zero-balance accounts are used for individual participants. |
Account maintenance fees, ongoing account management, bounced payment tracking, and Positive Pay considerations. |
| Virtual Card Payments | Virtual cards may be used for initial premium payments before transitioning to another payment method. |
Higher processing fees, multiple payment workflows, and additional reconciliation requirements. |
| Reimbursement Models | Employees pay premiums themselves and request reimbursement. |
Employees may need to front premium costs, and missed payments can put coverage at risk. |
| PremiumRails | Dedicated participant accounts support direct ACH payments with payment and policy information built into the transaction. |
Designed to reduce manual reconciliation, unnecessary fees, and payment-processing friction. |
The PremiumRails Payment Guarantee
PremiumRails backs the part of the payment process it controls.
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On Time
Once defined contribution funds settle in the applicable PremiumRails account, funds are transmitted within 1 business day.
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Reconciled on Arrival
Each remittance includes the carrier's required policy identifier and plan information in the required format, reducing manual list-bill matching.
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No Per-Employee Account Fees
No monthly bank maintenance charges per employee, setup paperwork, or card interchange fees passed through to carriers.
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Exceptions Surfaced in Hours
If a payment is returned, rejected, or unmatched, the employer and broker receive the reason code and remediation path within 8 business hours.
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Our Error, Our Expense
If a policy lapses because PremiumRails fails to meet Commitments 1 through 4, PremiumRails manages reinstatement with the carrier and reimburses documented reinstatement costs and back premium, up to the applicable guarantee limit.
Built for Enterprise CHOICE Administration
PremiumRails helps create a simpler payment experience for:
- Employers with defined contribution funding
- Brokers supporting ICHRA implementations
- Employees relying on timely premium payments
- Carriers receiving direct, identifiable payments
The PremiumRails Payment Guarantee applies only to PremiumRails’ performance beginning when employer contribution funds settle in the applicable PremiumRails account. It does not apply to delays or failures caused by employer funding timing or amount; employee enrollment, election, or eligibility errors; incorrect, missing, or changed policy identifiers; carrier systems or posting practices; carrier grace-period or termination decisions; Marketplace or exchange processing; return or rejection decisions made by a receiving financial institution; or events outside PremiumRails’ reasonable control.
