The ICHRA Shop included some ICHRA and QSEHRA enrollment estimates in an ICHRA market report the firm posted on LinkedIn earlier this week.

Related: ICHRA adoption surges 29% in 2024

For years, information about just how many people were using employer cash to pay for individual coverage was scarce, but O'Neill said via email that he thinks the growth curve for ICHRAs is now comparable to the early growth curves for adoption of health savings accounts and Affordable Care Act public exchange plan coverage.

Now, "the ICHRA wave is indeed gaining momentum," O'Neill said.

The history: Employers in most states once had a hard time offering cash-for-coverage programs.

Federal anti-discrimination laws and employee morale considerations pushed employers to offer similar coverage to all employees in a given location or a given business unit.

Most states let health insurers use medical underwriting in the individual major medical market. An insurer could reject applicants with serious health problems or require insureds with health problems to pay higher premiums.

Congress made offering cash-for-coverage programs much easier by putting a ban on medical underwriting in the individual market in the Affordable Care Act. The prohibition began to apply in 2014.

Kevin Kuhlman, a representative from the National Federation of Independent Business, reported at a Senate Small Business and Entrepreneurship Committee hearing in 2016 that 16% of the small businesses it surveyed in 2015 were helping employees pay for individual health coverage, even though no federal laws or regulations let small businesses do that.

Congress created the QSEHRA program, which is available to small employers, through a provision in the 21st Century Cures Act of 2016.

The Trump administration completed the regulations that created the ICHRA program, which is open to employers of all sizes in 2019.

After the U.S. Treasury Department and other departments completed the ICHRA regulations, regulation impact analysts predicted that 800,000 employers would eventually offer ICHRA arrangements to 11 million workers and dependents.

ICHRA program organizers were hoping to make 2020 their launch year. Then the COVID-19 pandemic hit and diverted all creative benefits energy to projects other than ICHRAs.

Since then, cash-for-coverage program organizers have kept moving forward, but information about the number of people using employer cash to pay for individual coverage has been hard to find.

The numbers: O'Neill said the cash-for-coverage program access estimate comes from an ICHRA market snapshot produced by Deft Research, the agency's own observations and other sources.

The agency now has a team combing through employers' Form 5500 benefit plan filings for more ICHRA and QSEHRA data, such as data on what types of firms are administering the programs.

The HRA Council, a group for firms in the HRA program market, has estimated that program use has increased by 29%, without publishing actual usage numbers, and it has suggested that adoption of ICHRAs at large employers has increased by 84%.

"The question of how many of these are 'compliant ICHRAs' remains unanswered," O'Neill said, alluding to the possibility that some employers are giving workers cash for individual coverage outside of any government-approved framework.

The future: Deft found signs of the existence of a big, untapped market for cash-for-coverage plans. Only 13% of the 624 people without full-time staff jobs had heard of ICHRAs, and 74% thought a hypothetical ICHRA package sounded at least moderately appealing.

O'Neill said he thinks the ICHRA market will grow faster once brokers understand how to analyze ICHRA arrangements better, the ACA public exchange programs do more to shut down sketchy exchange plan agents, and ICHRA administrators add more multilingual enrollment support.

Multilingual support is necessary because, today, "many who are not accepting the ICHRA offer are Spanish speakers," O'Neill said.