How does an individual coverage health reimbursement arrangement work?

An individual coverage health reimbursement arrangement (ICHRA), now known as the CHOICE Arrangement, is an employer-funded benefit that lets employers provide tax-free contributions toward employees’ individual health plan premiums. Employers set contribution amounts based on their healthcare budget, eligible employees select qualifying individual coverage, and use their employer-provided contributions to cover the cost.

Who is eligible for an ICHRA?

Employers of any size can offer an ICHRA to eligible employees. Employees must have qualifying individual health insurance coverage to participate. For greater flexibility, employers can vary contribution amounts by job-based employee classes, age, or family status.

Can employees choose their own health insurance policies with an ICHRA?

Yes. Employees choose individual health insurance plans that fit their healthcare needs, preferred provider networks, and budget. To use the benefit, they must enroll in qualifying coverage, such as ACA Marketplace health plans, certain student coverage, and eligible Medicare policies, like Medicare Parts A and B together or Part C.

How are ICHRA premiums paid?

Premium payment arrangements depend on the employer’s benefit administration process. Some organizations provide their employees with tax-free reimbursements, up to their contribution limit, after they pay for their monthly premiums. With Remodel Health, Autopay coordinates funding and automates premium payments directly to insurance carriers on time.

Does an ICHRA satisfy the ACA employer mandate?

An employer can satisfy the Affordable Care Act’s employer mandate for applicable large employers (ALEs) if their group coverage provides MEC, meets minimum value standards, and is affordable. With an ICHRA (now a CHOICE Arrangement), employers only need to offer an affordable contribution to at least 95% of their full-time employees and dependents. Employers should review their ICHRA benefits annually to ensure their contributions meet ACA regulatory requirements.

Chat With Us Today | Remodel Health

CHOICE Arrangement

CHOICE Arrangement FAQs

Nov 5, 2026, 9:14:35 AM 8 min read

HSA

Remodel Health and Lively bring HSAs into the CHOICE Arrangement experience

Nov 3, 2026, 8:33:29 AM 8 min read

Health Benefits

How does ICHRA work?

Oct 27, 2026, 2:15:00 PM 6 min read

Remodel Health is a financial technology company, not an FDIC insured depository institution. Banking services provided by Bangor Savings Bank, Member FDIC. FDIC insurance coverage protects against the failure of an FDIC insured depository institution. Pass through FDIC insurance coverage is subject to certain conditions. The Remodel Health Mastercard® Debit Card is issued by Bangor Savings Bank, Member FDIC, pursuant to license by Mastercard International Incorporated. Mastercard is a registered trademark, and the circle design is a trademark of Mastercard International Incorporated.

Interested in learning more?

Expert insights at your fingertips.

CHOICE Arrangement FAQs

Remodel Health and Lively bring HSAs into the CHOICE Arrangement experience

How does ICHRA work?

Earning Accolades in Health Innovation

Remodel Health
601 S. Meridian St.
Indianapolis, IN 46225

Interested in learning more?

Expert insights at your fingertips.

CHOICE Arrangement FAQs

Remodel Health and Lively bring HSAs into the CHOICE Arrangement experience

How does ICHRA work?

Earning Accolades in Health Innovation

Remodel Health601 S. Meridian St.Indianapolis, IN 46225

Remodel Health
601 S. Meridian St.
Indianapolis, IN 46225