Some U.S. employers are shifting from traditional group health plans to Individual Coverage Health Reimbursement Arrangements (ICHRAs), giving employees a set amount of money to buy their own insurance on the individual market. Supporters argue this offers more choice and cost control, however critics say it shifts the complex task of selecting insurance to employees and may lead to less comprehensive coverage, especially for older or sicker workers. Despite these concerns, ICHRAs are gaining popularity and could disrupt the traditional employer-sponsored insurance model.
President and CEO James Rodriguez provides industry insight regarding the change in the TexHealth blog :
“I agree that ICHRA is a viable option for some employers but there are a couple drawbacks besides the ones stated in the article. One obvious drawback is the lack of knowledge on the part of most employees when they are deciding which plan to enroll in. While new tools are beneficial in most cases I am slightly concerned about the impact this may have on employer sponsored health insurance. I would not want employers to jump in without working with a knowledgeable insurance agent who can help guide them through the process.”