A new report from the HRA Council indicates that the number of employees in the United States offered insurance through an Individual Coverage Health Reimbursement Arrangement (ICHRA) tripled between 2022 and 2023; those offered a Qualified Small Employer HRA (QSEHRA) at organizations with fewer than 50 employees doubled during the same time period.
"ICHRAs and QSEHRAs cover workers with quality ACA [Affordable Care Act] health insurance they select based on their own health needs," HRA Council Executive Director Robin Paoli said in a statement. "Employers empower employees to secure the coverage and care they need, with predictable budgets for health benefits. Choosing their own health coverage enables employees to stay with trusted providers and be secure in the ACA-compliant insurance that protects them from discriminatory practices such as pre-existing conditions and gender-based premiums."
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The report, titled "Growth Trends for ICHRA and QSEHRA: 2022 to 2023," adds more detail and context to the rise in popularity of HRAs, which the council describes as "401ks for health coverage." It also includes details on their effectiveness as a viable benefits solution and the role they play in shaping bipartisan health policy to help create a more accessible and affordable health care system. Additionally, the report breaks down HRA myths and facts.
According to the HRA Council, small businesses with fewer than 20 employees comprise 88% of employers offering ICHRAs and QSEHRAs, and the report also emphasizes how HRAs help small and mid-size businesses — which historically have struggled to offer or afford robust health benefits — attract and retain talent in a competitive job market.
That said, ICHRAs are not strictly for small companies. As the council notes, ICHRA adoption among applicable large employers — those with at least 50 full-time employees — more than doubled between 2022 and 2023, and has grown by 2,468% since 2020.
Other highlights of the five-page report include:
- More than 60% of employees offered an ICHRA are younger than 44.
- Plan choices are nearly evenly split between Gold, Silver and Bronze tiers, with employees selecting the coverage that's best for them and their families.
- HRA Council members report HRAs are an on-ramp to benefits for businesses that have never been able to offer health insurance.
- Since 2020, when ICHRAs became available, uptake has increased by 588% for ICHRAs and 72% for QSEHRAs.
Related: House passes ICHRA bill to give (small) employers a 'cash-for-coverage' option
"QSEHRAs and ICHRAs are a bipartisan success to advance health equity and connect more American workers with ACA plans offering access to mental, behavioral, and physical care," Paoli added. "HRAs deliver on the choice and portability that American workers deserve while giving employers a well-regulated, modern solution to cover more workers — including remote, hybrid, part-time, seasonal, and employees in diverse American regions."
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