Content Summary
report facing unsustainably-high cost pressures, and more than half exceeded their 2024 budgets by an average of 4.5 percentage points (WTW 2025 Best Practices in Healthcare Survey). Employers are looking not just for relief, but for structural change.
The Individual Coverage Health Reimbursement Arrangement (ICHRA), introduced in 2020, ICHRAs allow employers to simultaneously satisfy the ACA employer-shared responsibility requirements and provide a defined contribution subsidy that employees use to purchase individual health insurance.
Overall adoption is modest so far—ICHRAs currently cover roughly 1 million lives—but employer participation has grown more than 1,000% since 2020 (HRA Council; Becker’s Payer Issues). Even more telling: adoption by employers with more than 50 employees is up 34% from 2024 to 2025, while adoption by employers with fewer than 50 employees is up 52%. (Becker’s Payer Issues)
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