Insurance Coverage Affordability and Relief to Small Employers (ICARE)

Small businesses are the backbone of the Kentucky economy but often struggle to absorb the burden of rising health insurance costs. Recognizing this, the Kentucky State Legislature created a program – the Insurance Coverage Affordability and Relief to Small Employers (ICARE). The initiative was enacted by the 2006 Kentucky General Assembly and placed under the supervision of the Kentucky Office of Insurance. ICARE is a pilot program designed to help Kentucky employers pay premiums for workers. It is not a health insurance plan.

FSAB has assisted many small businesses in applying and qualifying for the ICARE program. If you have questions or would like to apply for ICARE please contact us at 1-800-916-FSAB. An agent will be glad to answer any questions you may have and or assist you with the application process.

To be eligible, an employer must:

  • Employ 2-25 people (full-time or full-time equivalent)
  • Pay at least 50 percent of the employee's premium for single coverage, and
  • Pay an average annual salary of no more than $51,510which is 300 percent of the federal poverty guidelines for a family of three. Salaries of any owners and employees who are ineligible are not included in this average.

    If a small business is eligible based on the above criteria, the program has two levels of health care incentive payments to reimburse employers for the cost of premiums:

· $40 per eligible employee per month if the employer has not offered health insurance for the past 12 months. The monthly amount decreases by $10 each subsequent year of the program.

· $60 per eligible employee per month for an employer group if at least one employee has a defined high-cost condition. The monthly amount decreases by $15 each subsequent year of the program.

The Kentucky Office of Insurance administers the program. Enrollment may be limited, based on funding available.


Basic information

How much money is available for the program?
The ICARE budget for the first two years of the program is $20 million. Applications will be accepted on a first come, first served basis. Enrollment will be limited to ensure that the $20 million appropriation is not exceeded. Designed as a pilot, additional legislation will be required to fund the program after the first two years.

What health insurance companies are participating?
All companies marketing to small groups or group associations must participate in ICARE. Those companies are Aetna Health, Aetna Life Insurance Company, Anthem Health Plans of Kentucky, Bluegrass Family Health, CHA Health, Humana Health Plan, John Alden Insurance Company, Principal Life Insurance Company, Trustmark Insurance Company, Union Security Insurance Company, United HealthCare Insurance Company, United HealthCare of Kentucky and United HealthCare of Ohio.

Small businesses already offering health insurance must have an employee with a high-cost condition in order to be eligible for an incentive payment.

Will a group be removed from the program if situations change and the business no longer meets the criteria for participation?
Not immediately. Employers will be required to re-establish eligibility at annual ICARE renewal. If the employer no longer meets the requirements for the option chosen, the business will not be allowed to continue participation in ICARE.

The amount of the health care incentive may decrease even if the employer remains eligible. For example, if a company has 10 employees at the time of application and is approved under the “high-cost condition” option, the monthly reimbursement would be $600. But, if the company’s payroll later drops to eight employees, the reimbursement will fall to $480.

In addition, the amount of the health care incentive will not increase once an application is accepted. For example, if a previously uninsured group begins the ICARE program with 10 eligible employees, the employer will receive an incentive payment of $400 per month. If two new employees are added to the payroll, the reimbursement will not increase but will remain at $400.

Will companies in border states that employ Kentuckians be eligible?
No, a company must be located in Kentucky and meet all other eligibility requirements.

What is “healthy lifestyle” and what discount will be available?
The discount criteria and amount will be developed by the insurers and may vary.

How will the monthly incentive checks be paid?
The monthly health care incentive payments will be issued directly to the employer of the eligible small group once the Office of Insurance has received proof of premium payment from the insurer. Checks are scheduled to be sent at the end of each month.

Does the plan cover part-time employees or dependents?
Employees who are eligible for coverage under an employer-sponsored health benefit plan are defined in the contract with the insurer. If part-time employees are included under the contract and the employer meets other eligibility requirements, the company will receive incentive payments for those workers. If covered under the contract, dependents could also receive health insurance but would not be eligible for a health care incentive payment. For purposes of participation in the ICARE program, an “eligible employee” cannot be someone who is 65 or older, is eligible for Medicare, or who does not meet eligibility as outlined in the contract between the employer and the insurer.


Updated: July 13, 2007

The Kentucky Office of Insurance does not discriminate based on race, color, religion, sex, national origin, sexual orientation or gender identity, ancestry, age, disability or veteran status. The cabinet provides, on request, reasonable accommodations necessary to afford an individual with a disability an equal opportunity to participate in all services, programs and activities.