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Employer-sponsored individual coverage health reimbursement arrangement plans might finally be showing up in health coverage enrollment statistics, four years after the start of the COVID-19 pandemic ruined their original debut.
Analysts at Mark Farrah Associates, a health coverage enrollment tracking firm, believe that ICHRA enrollees may now account for a noticeable fraction of the 24.3 million Americans who had individual or family major medical coverage March 31, 2024.
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Individual health enrollment was up sharply from 21.2 million a year earlier, in spite of some insurers' moves to shut down or reduce their level of participation in the individual market.
One reason for the increase may be from employers' ICHRA programs, according to the Mark Farrah analysts.
"Anecdotal data suggests that interest in and usage of ICHRAs are increasing," the analysts write.
Another sign that some of the new individual enrollment could be ICHRA enrollment is that individual enrollment increased by 3.2 million during a year when the labor market was strong but reported enrollment in employer-sponsored group health plans fell by 1.5 million, according to Mark Farrah data.
The history
Employers and their benefits brokers and plan administrators dreamed offered cash-for-coverage plans for decades.
Starting in the 1990s, offering cash-for-coverage plans became difficult. Most states let health insurers reject applicants with health problems and charge higher premiums for enrollees with health problems.
Medical underwriting clashed with employee benefits antidiscrimination laws and killed the old cash-for-coverage plans.
The new cash-for-coverage plans
The birth of the Affordable Care Act system cleared away the medical underwriting barriers to cash-for-coverage plans in 2014.
Workers can now buy individual major medical coverage on a guaranteed-issue basis. Preexisting conditions have no effect on the workers' access to coverage or premiums.
Congress used the ACA framework to create one cash-for-coverage program, the qualified small employer health reimbursement arrangement, in the 21st Century Cures Act of 2016.
In 2019, during the Trump administration, federal agencies created another cash-for-coverage option, the ICHRA, which is available to large employers as well as small employers.
Health insurers and plan administrators were originally hoping 2020 would be the year of the ICHRA and QSEHERA.
COVID-19 changed things. In 2025, now that COVID has become part of the background noise, ICHRA and QSEHRA may get a new chance to capture employers' attention.
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Allison Bell
Allison Bell, a senior reporter at ThinkAdvisor and BenefitsPRO, previously was an associate editor at National Underwriter Life & Health. She has a bachelor's degree in economics from Washington University in St. Louis and a master's degree in journalism from the Medill School of Journalism at Northwestern University. She can be reached through X at @Think_Allison.
