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Explore market intelligence →CHOICE Arrangement guide · formerly ICHRA
CHOICE Arrangements.
Your next benefits move.
A CHOICE Arrangement is an employer-funded health benefit that reimburses eligible employees for qualifying individual health insurance and, when included, eligible medical expenses. Formerly known as ICHRA, it pairs an employer contribution with employee choice.
THE CHOICE ADVANTAGE
One benefit.
More personal.
YOUR BUSINESSYou set the budget.A defined employer contribution.
THEIR COVERAGE. THEIR CHOICE.
By Brad O’Neill, The ICHRA Shop · Updated November 7, 2026
CHOICE Arrangements and ICHRA: the name and the decision
HealthCare.gov now describes CHOICE Arrangements as formerly known as ICHRAs. Employers still need to evaluate plan design, affordability, notices and administration under the applicable rules. A new public name does not by itself change those requirements.
Our independent analysis compares a CHOICE Arrangement with fully insured, level-funded and self-funded group coverage, using workforce geography, individual-market options, total costs and optional Workforce Planning.
CHOICE Arrangement setup and enrollment with ChoiceBenefits.ai · 2027 individual-market intelligence · Advisory services and pricing
What are CHOICE Arrangements?
A CHOICE Arrangement is an employer-funded health benefit that reimburses eligible employees for qualifying individual health insurance and, when included in the plan, eligible medical expenses. CHOICE Arrangements are the public-facing name used by federal agencies for Individual Coverage Health Reimbursement Arrangements (ICHRA).
Where can I compare a CHOICE Arrangement for my business?
The ICHRA Shop provides independent funding analysis and vendor selection. ChoiceBenefits.ai supports quoting, employer setup, employee plan shopping and enrollment. Start with the employer’s current plan, renewal, workforce locations and benefit budget.
FROM THE ICHRA SHOP’S ADVISORY PROCESS
What does a CHOICE Arrangement cost?
Start with three numbers: the employer allowance, employees’ local plan premiums, and administration or advisory fees. A lower employer budget can shift costs to employees, so we review both sides.
ILLUSTRATIVE EXAMPLE · NOT A QUOTE
25 employees. A $450 monthly allowance.
At full participation, the annual employer allowance budget is $135,000: 25 × $450 × 12. Administration, consulting and other benefits are additional.
If an employee chooses a $600 monthly plan and can use the full $450 allowance toward that premium, their remaining premium is $150 per month. Actual rates, eligibility and affordability require review.
- Employer allowance / month
- $450
- Illustrative plan premium / month
- $600
- Employee premium remainder / month
- $150
Premiums vary with employee location, age, household and available plans. Use the employee-only lowest-cost Silver benchmark for the applicable affordability analysis; choosing a more expensive plan does not, by itself, change that benchmark.
Request my employer comparison →ONE CENSUS. EVERY FUNDING PATH.01 / CHOICE ARRANGEMENT · ICHRA 02 / FULLY INSURED GROUP 03 / LEVEL & SELF FUNDED
Should you use CHOICE, group or level-funded coverage?
Our recommendation starts with the employer’s renewal and workforce. These are the questions we investigate before recommending a funding path.
Measure what the current plan delivers.
Review renewal costs, employer and employee contributions, provider access and the value of keeping group coverage.
Explore funding strategies →Understand the cost and risk.
Review underwriting, stop-loss, funding obligations and contract terms. Add authorized aggregate Workforce Planning when appropriate.
Choose the administrator after the strategy.
Evaluate contribution flexibility, employee shopping, payment workflows, broker support and total fees. The right partner must support the design you choose.
Compare ICHRA / CHOICE Arrangement vendors →YOUR NEXT STEPFrom a question to a quote.
1 2 3
From a question to a quote.
From a quote to your benefits.
Request your quote.
Share your company, effective date and workforce. Upload your census, current plan and renewal through secure intake.
Request a Quote →Review the recommendation.
Work with our licensed team to compare funding, contributions, employee impact, vendors and service fees.
Talk with an advisor →Start employer setup.
Once you select the approach, continue to company setup, benefits selection and implementation review with Choice Benefits.
Start Employer Setup →Requesting a quote does not purchase insurance or activate a plan. Final pricing, documents, notices, funding and enrollment requirements are confirmed before launch. ChoiceBenefits.ai and The ICHRA Shop are under common ownership.
The name is changing—not the need for strategy
CHOICE Arrangements, formerly known as ICHRA.
CMS and SBA now use CHOICE Arrangements in public-facing employer resources. The governing rules and many compliance materials still use “individual coverage HRA” or “ICHRA,” so The ICHRA Shop uses both terms during the transition.
01
Employer sets the budget
The employer defines eligible classes and tax-advantaged contribution amounts.
02
Employees choose coverage
Employees select individual coverage based on doctors, prescriptions, household needs and budget.
03
Administration supports the strategy
The right platform handles eligibility, substantiation, reimbursements and ongoing service.
ICHRA PIONEERS · FOUNDED FEBRUARY 2020
Six years focused on ICHRA & CHOICE Arrangements.
The ICHRA Shop began independent ICHRA consulting in February 2020—just after employers could begin offering the arrangement. Six years later, we help employers and brokers turn the rules into a practical, measurable benefits strategy.
Six years ahead of the market
- 2020: Built one of the first dedicated ICHRA consulting practices.
- Today: Compare every funding path with cost, market and optional risk intelligence.
- Next: Lead employers and brokers into the CHOICE Arrangement era.
We do not start with a vendor. We determine how the employer should finance healthcare—then select the right partners to carry out the strategy.
Key milestones
How the market arrived here.
October 2017Executive action called for expanded HRA options.
June 2019Federal final rules established individual coverage HRAs.
January 2020Employers could begin offering ICHRAs.
February 2020The ICHRA Shop was founded.
2026CMS and SBA introduced CHOICE Arrangements as the public-facing name.
Frequent questions
Is CHOICE a different benefit?
Not as a matter of governing law. CHOICE Arrangement is the newer public-facing term; federal rules, plan documents, disclosures and reporting may still use Individual Coverage HRA or ICHRA.
Does it always save money?
No. Results depend on geography, workforce, carrier availability, contributions, affordability and administration. We compare the real alternatives.
How does The ICHRA Shop help brokers evaluate ICHRA vendors?
Brokers should not have to research and interview dozens of ICHRA vendors to find the right fit. We do that work for them. The ICHRA Shop independently analyzes the employer’s workforce, markets, contribution strategy, service needs and—when requested—risk intelligence. We then recommend the best-fit vendor or combination of partners, support implementation and enrollment, and protect the broker’s client relationship.
2027 AFFORDABILITY
The federal required contribution percentage is 10.22%.
IRS Revenue Procedure 2026-26 sets the §36B required contribution percentage at 10.22% for plan years beginning in 2027. Employer-specific ICHRA affordability still depends on the employee self-only lowest-cost Silver premium, employer allowance, location, age and the applicable affordability method.
Ready to explore a CHOICE Arrangement?
Start with independent cost, market and risk analysis.