Employees want more control over their health plan. Are ICHRAs the answer?

Key insight: Discover how ICHRAs convert volatile health benefits into targeted, employee-choice compensation.
What's at stake: Misaligned benefits risk losing talent and escalating total compensation costs.
Expert quote: Hooper - Letting employees buy their own plans turns benefits into recruiting and retention leverage.
Source: Bullets generated by AI with editorial review

When it comes to a solution for more personalized healthcare plans, individual coverage health reimbursement arrangements are on everyone's lips, but what does the transition to offering them actually look like?

Over half (51%) of employees said they should control their health plan choices, and 49% said they'd prefer to receive money from their employer and shop for their own coverage, rather than go on a company plan, according to a survey from health benefits tech company and individual coverage health reimbursement arrangement (ICHRA) provider Take Command. 

In addition to picking a plan that better meets their needs, cost concern was a main reason workers see value in shifting from a group to an individual option: 73.5% of respondents reported the price of health insurance "increased somewhat or significantly for 2026," but those with individual insurance were more likely to say their costs remained stable.

"American workers want the freedom to choose their own healthcare. Employers who give employees money to choose an individual plan turn health benefits from a volatile expense into a valuable asset for attracting skilled employees and retaining top talent," Jack Hooper, CEO of Take Command, said in a release. 

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How to approach a potential shift

Benefit leaders and advisers should prioritize understanding how these plans work to determine whether they'd be a good fit for the employees and businesses they serve, said Hooper. ICHRAs have been around since 2020, and while still relatively new to the benefits space, leaders can move beyond whether or not they work in general to "does it work for us," he explained. 

For example, Take Command broke its survey results down by industry and found that while 66% of respondents in IT jobs would prefer to receive employer money to purchase their own plan, only 36% of government and policy employees said the same. 

"The reality is ICHRA isn't a solution for everyone, but what we're starting to see is that for targeted industries and targeted markets, it is superior to other options," Hooper said. "This is where, as an employer, it's good to get educated. Talking to [an ICHRA provider], or reading some of the industry guidance … can be really crucial, because if you're a hospitality group or a home health company and you're not doing this, you're behind your competitors, and you're not delivering what your employees are wanting."

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Hooper encourages benefit leaders to request a side-by-side comparison of their current plan, the level-funded alternative and an ICHRA option from their broker. They should also consider key factors that might signal a great fit for ICHRA, such as if group plan renewal costs are a risk or are outpacing inflation, whether their workforce is dispersed or whether they have a mix of full and part-time employees, he said. 

"For distributed workforces, for example, getting a national group PPO plan is like a peanut butter spread — you're buying something with no cost containment, and it's going to be really great for some employees in one location, and terrible for employees and another. That's where we'd say you should look at ICHRA and let everyone buy in their local market," Hooper said.  

Benefit leaders can evaluate different coverage scenarios, including adding ICHRAs to their offerings while keeping a group plan option if they each make sense for different populations, he added. 

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Hooper pointed out that close to 95% of Take Command's survey respondents said healthcare was an important part of their decision to stay or leave a job — evidence that benefit leaders who align their offerings with what employees value most will come out ahead. 

"There are so many things competing for benefit managers' attention right now, but you can't take your eye off the ball here, because it can either be a weapon for you to recruit and retain employees, or it can be a drain."