Pairing a CHOICE Arrangement with direct primary care

Healthcare benefits often don’t fit into a traditional model, and many times employers have to combine them with other benefits to provide employees with enough value. As employers look for ways to make coverage more affordable while giving employees better access to care, some are integrating a CHOICE Arrangement, formerly known as an individual coverage health reimbursement arrangement (ICHRA), with direct primary care (DPC)¹.

A CHOICE Arrangement provides employees with a defined employer contribution they can use toward qualified individual health insurance coverage. In contrast, a DPC provides more direct access to primary care at a predictable price. Together, they can help you design a comprehensive benefits strategy that gives your employees access to routine medical services and protection against larger, unexpected medical expenses.

In this blog post, you’ll learn:

• How direct primary care works and why it can be beneficial.
• How employers can pair a CHOICE Arrangement with direct primary care.
• How Remodel Health can help employers create a CHOICE Arrangement strategy to coordinate direct primary care.

Watch TJ Witham, VP of Broker Sales at Remodel Health, speak with Brian Garcia, VP of Strategic Alliances at Nexus Health Connect, about how direct primary care and ICHRA can work together on Remodel Health’s podcast.

How does direct primary care help individuals access affordable healthcare?

Direct primary care (DPC) is a membership-based model in which individuals pay a fixed, recurring fee directly to a primary care practice in exchange for a defined set of medical services. Because DPC practices rely on membership, the patient-physician relationship is often stronger and built on trust, which can result in greater patient satisfaction.

DPC memberships commonly include primary and preventive care, longer medical office visits, care coordination, and easier access to a doctor. DPC practices typically don't bill an insurance company for services. Instead, they usually charge a monthly, quarterly, or annual fee that allows patients to schedule in-person and virtual office visits as needed.

DPC isn't a replacement for health insurance as it focuses on routine and preventive care. While this makes DPC beneficial for maintaining your health, it also means it doesn't cover major expenses such as hospital stays, surgery, specialty services, or other catastrophic care. These major medical services and treatments can be costly, so pairing DPC with comprehensive individual health coverage can be useful.

Can you pair a CHOICE Arrangement alongside a direct primary care membership?

Yes. Employers can pair a CHOICE Arrangement with a DPC membership program. In fact, the two benefits complement each other. The CHOICE Arrangement allows employees to use their tax-free employer contributions to purchase qualified individual health insurance and cover major medical expenses, while DPC provides an additional way to access routine primary care.

On Remodel Health's ICHRA Exclusive podcast, Brian Garcia, VP of Strategic Alliances at Nexus Health Connect, described the relationship as separating everyday care from financial protection for more significant medical events.

“The ICHRA in this case would be like the financial protection for those catastrophic events,” said Garcia. “DPC is your day-to-day stuff.”

Instead of relying on a single health benefit to meet every employee's needs, using a CHOICE Arrangement and a DPC together helps employees cover more healthcare services at an affordable price.

The advantage for employers remains the same: they can provide a flexible, comprehensive health benefit that eliminates the need for costly traditional group coverage, controls their budgets through defined contributions, and gives employees more choice in how they receive medical care.

How can employees use a CHOICE Arrangement and direct primary care together?

When designing their CHOICE Arrangement benefit, employers determine a CHOICE Arrangement contribution amount that employees can put toward qualifying individual health plans. Employees can choose the plan that works best for them and decide whether to sign up for a DPC membership in addition to their chosen health coverage.

Then employees can do the following:

• Go to a DPC provider for primary care. Employees can use their DPC membership for eligible primary care services, routine visits, preventive care, and ongoing care coordination.
• Use their individual health insurance for broader coverage. The employee uses their CHOICE Arrangement contribution to pay for their individual health plan premiums and, if their benefit plan allows, medical services that DPC doesn’t cover. Employers offering a qualified medical expense HRA (QME HRA) alongside a CHOICE Arrangement with Remodel Health can reimburse employees for out-of-pocket costs the individual plan doesn’t fully cover, including hospitalization, specialist care, and other qualified expenses. Employees simply submit a request and a receipt or an explanation of benefits (EOB) that shows their health plan processed the expense.

Garcia likened individual health coverage through a CHOICE Arrangement to car insurance, and DPC to coverage for the everyday expenses that keep a vehicle (or, in this case, your employees) running.

“When you buy an automobile, you insure it, but you have to buy gas, tires, and oil changes for it,” said Garcia. “You’re paying cash for those day-to-day activities with that vehicle. That’s your direct primary care right there. The auto insurance that you have on your cars for the catastrophic events, like any accidents you get into, that’s the ICHRA and the financial protection on that side.”

Recent changes to health savings account (HSA) rules have made combining DPC with HSA-eligible health coverage even more attractive. As of January 1, 2026, individuals enrolled in qualifying direct primary care service arrangements (DPCSAs) are eligible to contribute to an HSA, as long as the arrangement meets IRS requirements².

The change also allows employees with an HSA-eligible health plan to use tax-advantaged HSA funds to pay for DPCSA membership fees, as long as the total doesn’t exceed $150 per month for an individual or $300 per month for a family.

Here’s what that benefits strategy could look like:

1. An employee enrolls in an HSA-eligible individual health plan.
1. This is an HSA-eligible high deductible health plan, including all on-exchange Bronze or catastrophic plans, and the same off-exchange versions of those plans.
2. They use their CHOICE Arrangement contribution to help pay the premium for an HSA-eligible plan.
3. They and their employer can contribute funds to the HSA tax-free.
4. The employee can withdraw HSA funds to pay for qualifying DPCSA membership fees (up to the monthly limit) and other qualified out-of-pocket costs.
5. Depending on plan design, the employee can use their CHOICE Arrangement benefit to pay for eligible healthcare costs their DPCSA arrangement doesn’t cover.

“Direct primary care is like advanced primary care for the masses, and I think that the ICHRA framework and the new HSA legislation is hopefully going to open up direct primary care for more and more and more people,” said TJ Witham, VP of Broker Sales, Remodel Health.

How Remodel Health can help employers offer a personalized CHOICE Arrangement that leverages direct primary care

Coupling DPC with an existing CHOICE Arrangement doesn't mean employers need to completely start from scratch. Instead, you can add DPC to your defined contribution strategy, with the CHOICE Arrangement providing the foundation for health coverage.

Remodel Health can help employers design and administer the CHOICE Arrangement portion of that strategy to align with their budget, workforce, and benefits goals. Employers can work with us to determine contribution amounts and employee classes so that employees can buy individual coverage on their local market. We can also help you establish a QME HRA for out-of-pocket expenses.

Whether you’re switching to a CHOICE Arrangement for the first time or you already have one in place, Remodel Health can help employers create a CHOICE Arrangement that complements the additional DPC component and focuses on expanded access, flexibility, and financial predictability.

With Remodel Health, employers can:

• Develop contribution amounts and employee classes based on your workforce, budget, and benefits goals rather than using a one-size-fits-all approach.
• Give employees the freedom to select individual health insurance that fits their healthcare needs, location, and preferred providers.
• Experience our ClearChoice benefits transformation model. Employees with complex medical situations can access Remodel Health's licensed Benefits Advisors for help comparing individual health plans and understanding their coverage options. Launch Coordinators and Customer Success teams provide additional support throughout implementation and beyond.
• Add DPC options as a complementary component of their overall benefits strategy, giving employees greater access to predictable primary care. At the same time, the CHOICE Arrangement provides financial security for more complex medical procedures.

Like with any other changes to your benefits strategy, the key is having the right plan design. Our team will work with you to analyze your workforce, local individual markets, DPC availability, and budget, so you have the right combination of benefits in place for your company.

Conclusion

Pairing a CHOICE Arrangement with DPC arrangements gives employers another way to shape a personalized benefits strategy that delivers both everyday access and protection against major healthcare costs. DPC can provide a more direct path to primary care, while a CHOICE Arrangement gives employees the flexibility to choose individual health coverage that protects them beyond routine medical services. This combination gives employees total control over their medical care and finances so they can worry less about the future.

Ready to see whether a CHOICE Arrangement paired with DPC could work for your organization? Schedule a call with the Remodel Health team to learn more!

References

1. CMS - CHOICE Arrangements: A Guide for Employers
2. IRS Notice 2026-05