Know whether ICHRA wins before you change
An Individual Coverage Health Reimbursement Arrangement (ICHRA) lets employers fund employees' individual market coverage with a defined, tax-advantaged contribution. It is a strong option for some employers — and the wrong one for others. We help you tell the difference before you change a thing.
Five factors that decide whether ICHRA wins
Explore each factor to think through whether ICHRA fits your workforce. This is an informational framework — it does not store anything you read and it is not a legal determination.
Who are you covering, and how diverse are their needs?
ICHRA tends to fit best when a workforce spans different life stages, geographies, or coverage needs — and less well when everyone wants the same plan.
- A workforce with varied ages, family sizes, or health needs can benefit from individual choice.
- A workforce that prefers one shared plan and network may prefer a traditional group plan.
- Federal rules allow certain employee classes — including full-time, part-time, seasonal, salaried or hourly, and employees in the same rating area — subject to class-size and other requirements.
This framework is informational and does not store anything you read. It is not a legal determination or a recommendation to adopt ICHRA. Whether ICHRA fits depends on your specific workforce, budget, and market. Request a feasibility review for guidance tailored to your circumstances.
Traditional group plan vs ICHRA
A concise comparison across the dimensions that matter most. Neither path is universally better — the right choice depends on your workforce and goals.
Cost structure
- Traditional group plan
- Defined benefit; employer and often employees share a negotiated premium.
- ICHRA
- Defined contribution; employer sets a fixed, tax-advantaged amount per employee.
Annual cost movement
- Traditional group plan
- Premiums are renegotiated each year and can rise with claims experience.
- ICHRA
- Contributions are set by the employer and held to a budget you control.
Employee choice
- Traditional group plan
- Employees select from the plans the employer offers — usually one or two.
- ICHRA
- Employees use the contribution to shop the individual market for the plan that fits them.
Network & providers
- Traditional group plan
- Network is fixed by the chosen group plan; breadth depends on the carrier.
- ICHRA
- Network depends on the individual plan each employee selects on the marketplace.
Administration
- Traditional group plan
- Carrier handles eligibility, enrollment, and claims; employer manages renewals.
- ICHRA
- Employer coordinates an ICHRA administrator for reimbursements and compliance.
Best suited for
- Traditional group plan
- Workforces that want one shared plan and a carrier-managed experience.
- ICHRA
- Workforces with varied needs across a strong individual market that value choice.
An ICHRA comparison that changed the renewal math
One employer faced approximately a 25% traditional renewal increase. SSGI completed a plan comparison and the resulting outcome showed approximately $520,000 in combined annual savings — including approximately $57,000 in direct employer savings — compared with the incumbent renewal.
- ~25%Traditional renewal increase the client faced
- ~$520,000Combined annual savings in the completed comparison
- ~$57,000Direct employer savings versus the incumbent renewal
Figures based on a client-specific plan comparison, rounded, and compared with the incumbent renewal. Results vary and are not guaranteed. Client name, industry, geography, workforce size, carriers, and plan details withheld.
Want to know whether an ICHRA comparison could change your renewal math? Request a benefits review and we'll start with your numbers.
Request a Benefits ReviewHow an ICHRA review moves forward
A compact path from the first fit question through launch and ongoing support — with licensed people accountable at every step.
- Evaluate fit
- Design contributions
- Confirm requirements
- Coordinate partners
- Launch & support
SSGI coordinates with the ICHRA administration partner and your carriers. We are not the reimbursement administrator ourselves — licensed people stay accountable for every recommendation and decision throughout your review.
Where to verify ICHRA rules
ICHRA is governed by federal rules set by the IRS, the U.S. Department of Labor, and CMS. These are the official resources to confirm how ICHRA works.
Sources
- IRS — Health Reimbursement Arrangements (HRAs)Internal Revenue Service newsroom page on HRAs, including ICHRA.
- DOL — Individual Coverage Model NoticeU.S. Department of Labor individual coverage model notice for employers.
- CMS — Health Reimbursement ArrangementsCenters for Medicare & Medicaid Services page on health reimbursement arrangements.
This page is informational and does not constitute legal, tax, or actuarial advice. ICHRA design and compliance depend on your specific circumstances. Consult qualified counsel and a tax advisor before adopting or modifying any health reimbursement arrangement. For more employer-facing background, browse the Employer Benefits Resource Center.
Request an ICHRA Feasibility Review
We'll show you where ICHRA fits, where it does not, and what the numbers mean for your workforce.