Summary
One in three businesses currently offering health benefits reported likely ICHRA adoption in the next two years, yet knowledge gaps and reported hesitations suggest reported demand may outpace actual uptake.
- Employers with 100+ employees expressed the greatest interest in ICHRAs, with 62% likely to adopt in the next two years. Interest was highest among businesses with 500–9,999 employees; nearly 50% of businesses this size reported familiarity with ICHRAs as well as consideration of and a likelihood of adopting them in the next two years.
- Among small businesses not offering coverage today, one in four indicated a preference for an ICHRA over a traditional group plan. However, awareness remains a major gap — 55% were unaware that an ICHRA is an option to them today.
- The primary advantages of ICHRAs were consistent across employer sizes: Flexibility of benefits, increased employee choice, and affordability to employers were highest rated.
- Hesitancy to adopt ICHRAs was driven largely by marketplace concerns, across all business sizes. Among employers offering coverage today, perceived employee preferences for a group plan were also a top reason for not adopting an ICHRA.
- Employers would be more likely to adopt an ICHRA if they could guarantee the same quality of network and choice as a group plan (85%) and if their broker (77%) or peer (76%) were to recommend or adopt an ICHRA.
- Policy changes could also further drive adoption, especially through a stable, high-quality, and affordable individual marketplace; tax credits could also accelerate adoption.