How ICHRA can elevate employee satisfaction

Health benefits are among the top factors influencing employee satisfaction and retention. Yet, traditional group health insurance often falls short, offering limited choice, rising annual costs, and one-size-fits-all plans that don’t reflect the diverse needs of modern teams.

That’s where the individual coverage health reimbursement arrangement (ICHRA) comes in. By shifting from a group-based model to an individualized, employee-first approach, ICHRA empowers both employers and their teams.

In this article, we’ll explain how ICHRAs can enhance employee satisfaction, encouraging them to stay with your company long term.

In this blog post, you’ll learn:

• How ICHRA works.
• How ICHRA can strengthen your employee benefits package.
• How Remodel Health can help you or your clients offer ICHRA.

Employee satisfaction starts with better health benefits

Aside from a competitive salary, employee benefits are the next best thing you can offer. But not all employee benefits are created equal. Health benefits outrank retirement plans, dental insurance, and vision insurance. According to PeopleKeep by Remodel Health’s 2024 Employee Benefits Survey, 92% of employees consider health benefits important, making it the most sought-after perk you can provide.

Now, you could offer an outdated, traditional group health plan. But there’s a modern alternative that offers more advantages, and many employers are taking notice. According to the HRA Council¹, there was a 34% increase in ICHRA adoption among large employers from 2024 to 2025.

Let’s review four ways ICHRAs outperform group insurance plans.

1. Autonomy and choice

The cornerstone of ICHRA is freedom of choice. Instead of being locked into a single group plan, employees can choose the health coverage that fits their individual needs, location, and family situation.

For example:

• A young professional might choose a lower-premium, high-deductible plan paired with an HSA.
• A parent might prioritize a plan with robust pediatric care.
• A team member focused on chronic illness management might opt for a plan with specific specialist coverage.
• An employee may choose a plan that offers more comprehensive mental health coverage.

When employees can choose the plans that work best for them, it creates a sense of ownership and empowerment. These are two key drivers of employee engagement and job satisfaction.

2. Cost efficiency and transparency

ICHRAs provide tax-free health coverage for employees. The benefit is also tax-deductible for employers. That means employees get more value out of every dollar their employer contributes.

Here’s how it works:

• You set a monthly allowance for your employees to spend on health insurance coverage.
• They use that money to purchase individual health plans. If the plans they pick cost more than the allowance you offer, they pay the difference.

Even better, the individual market often offers more transparent pricing and a wider range of options than traditional group insurance. Employees can shop for plans that balance cost and coverage according to their own priorities. This not only enhances job satisfaction but can also reduce stress related to healthcare costs, which is a major factor in overall employee well-being.

3. Simplified healthcare navigation

Health insurance can be confusing, but ICHRA simplifies the experience. Since employees purchase their own coverage through the individual marketplace, they often have access to AI-powered tools, clear plan comparisons, and ongoing support from licensed advisors. In many cases, they can also keep their preferred doctors and clinics since they can compare carrier networks, thereby reducing the frustration of network restrictions.

4. Greater sense of appreciation

Providing a flexible, modern health benefit, such as an ICHRA, demonstrates that your organization is forward-thinking and genuinely cares about the people behind the work. You see them as unique individuals. This can foster a greater sense of appreciation among your employees, ultimately boosting job satisfaction and morale.

Elevate employee satisfaction with Remodel Health

Offering an ICHRA instead of traditional group plans can improve your employees’ job satisfaction. But the ICHRA administrator you choose can significantly impact your benefit’s success. As a leading ICHRA provider, Remodel Health helps organizations of all sizes design and manage customized ICHRA solutions that meet their people where they are.

Our experts handle:

• Onboarding and support
• Plan design
• Legal plan documents
• Autopay for employee individual health insurance premiums
• Required ICHRA plan notices
• Providing necessary data and instructions for compliance filings

Our ICHRA+ platform integrates with more than 200 payroll and HRIS systems, simplifying administration while delivering a seamless experience for your team. Your employees can also shop for health insurance plans directly from their Remodel Health account.

Conclusion

Employees want flexibility, personalization, and transparency in every aspect of their employment, including health benefits. ICHRA delivers exactly that. By giving employees more choice, cost control, and confidence in their healthcare, employers can create benefits packages that boosts job satisfaction.