ICHRA for Healthcare Organizations

The smarter way to offer cost-effective health benefits your clinical staff will actually value

Whether you or your clients are running a dental practice, therapy clinic, physician group, or another healthcare organization, the people keeping your practice running expect competitive health benefits. But the cost of traditional group health insurance keeps growing more expensive and harder to manage.

An individual coverage health reimbursement arrangement (ICHRA) flips the model. Instead of one-size-fits-all coverage that can come with double-digit rate increases, ICHRA allows employers to offer a tax-free contribution without the unpredictability of annual premium increases. Employees choose the individual plans that work best for them.

Remodel Health has helped thousands of employers, including healthcare organizations and hospitals, make the switch. We make implementing and managing ICHRA simple, helping healthcare organizations provide meaningful benefits while reducing administrative burden and controlling health insurance costs.

Understanding ICHRA for healthcare organizations

An individual coverage health reimbursement arrangement (ICHRA) is an employer-funded health benefit. It allows organizations to give employees tax-free contributions for individual health insurance premiums and, if added in the plan design, qualified medical expenses.

Instead of offering a group insurance plan, employers using an ICHRA set a fixed monthly contribution for each employee. Employees then use that allowance to purchase their own individual health insurance policy. They can enroll in a policy right from Remodel Health’s ICHRA+® platform.

Here’s how it works:

The employer sets a monthly contribution. The employer determines eligibility and contributions by employee class, such as part-time or full-time employees, or by geographic location, like a rating area. They can either offer a dollar amount or a contribution percentage based on a benchmark plan. Remodel Health will help you design a compliant ICHRA contribution strategy. Healthcare organizations offered an average self-only ICHRA contribution of $579 with Remodel Health in 2025.
Employees choose their own health plan. Each employee shops for and enrolls in an individual health insurance plan that fits their needs and budget. They're not lumped into a one-size-fits-all group health plan. Our ICHRA+ platform allows employees to filter plans by providers and medications to help them choose the plan that fits their needs. Those with complex medical situations can meet one-on-one with a licensed Benefits Advisor.
ICHRA contributions go toward employee premiums. Rather than reimbursing employees for their premium costs, our platform supports automated premium payments directly to insurance carriers.

With Remodel Health as your benefits administrator, we streamline this process through guided plan design and enrollment, compliance support, and white-glove customer service.

Why healthcare organizations are turning to ICHRA

Healthcare organizations face a unique challenge. While delivering care to patients every day, they're also dealing with rapidly rising healthcare costs of their own. Mercer found that employer healthcare costs will increase by 6.7% in 2026, the highest growth rate in 15 years.

As specialty drug spending continues to surge and workforce pressures create additional financial strain, many medical practices are exploring alternative coverage options.

If you’re running a healthcare organization, you already know that shifting Medicaid and Medicare payments don’t keep pace with your actual costs. When these payments get cut or frozen, your operating budget absorbs the cost, and benefits are often the first line item that takes a hit. ICHRA provides another option. By moving to a defined contribution model, you set your budget for the year.

"Healthcare facilities face challenges similar to other employers, but they also encounter additional pressure from changes to Medicaid & Medicare spending that impact their bottom line. In an ever-changing economy, ICHRA can provide certainty & stability that traditional coverage cannot, while ensuring access to fully insured, community-rated policies."

Kelsey Frizzell

Territory Sales Lead, Remodel Health

Key benefits of ICHRA for healthcare organizations

By replacing group health plans with a defined contribution model, ICHRAs give employers greater cost predictability while empowering employees to choose the health coverage that best meets their needs.

Control your benefit costs

Group health insurance premiums rise year after year. The ICHRA gives you greater control over your benefits budget by allowing you to set a defined monthly allowance for employees.

Instead of absorbing unpredictable monthly premium increases or the risk of self-funded plans, you decide how much to contribute and can adjust your strategy as your organization grows.

Tax advantages

ICHRA offers tax benefits for both employers and employees. ICHRA contributions are tax-deductible and aren't subject to payroll taxes for employers. Contributions for qualified medical expenses are also tax-free for employees. They don't increase their taxable income.

Some states also offer tax credits for small businesses that can further reduce the cost of offering health coverage through arrangements like ICHRA.

Give employees more choice

Healthcare professionals understand the importance of quality healthcare coverage. They often have strong preferences about the plans they want. With ICHRA, employees aren't forced into the same group health plan. They can choose the individual health coverage that fits their unique circumstances.

Support a distributed workforce

Many healthcare organizations have staff across multiple offices, clinics, or service areas. Traditional group health coverage can create network limitations and administrative complexity across locations. ICHRA allows employees to pick individual plans available where they live and work.

Improve recruitment and retention

Competitive health benefits remain one of the most important factors candidates consider when evaluating job opportunities. According to PeopleKeep by Remodel Health's Employee Benefits Survey, 92% of employees consider health benefits important.

By offering a modern health benefit like an ICHRA, healthcare organizations can:

Compete for top clinical talent
Improve employee satisfaction
Reduce turnover

Employees appreciate having greater control over their healthcare coverage while still receiving valuable employer support.

Simplify benefits administration

Managing a group health plan can be time-consuming, especially for growing healthcare practices and organizations. When you offer an ICHRA, employers can streamline benefits administration by eliminating group health plan renewals and participation requirements.

Comply with federal regulations

For applicable large employers (ALEs) with 50 or more full-time equivalent employees (FTEs), ICHRA can also help meet the Affordable Care Act's (ACA) employer mandate. When designed to be affordable and provide minimum essential coverage, an ICHRA can satisfy employer shared responsibility requirements while giving employers greater budget predictability.

What makes Remodel Health different

Implementing an individual coverage health reimbursement arrangement (ICHRA) doesn't have to be complicated. For more than a decade, Remodel Health has helped organizations transition to personalized health benefits. Our platform and dedicated support team simplify every step of the process.

Technology can’t solve the realities of delivering ICHRA on its own. That’s why we pair technology with expert guidance, trust, and support.

When you partner with Remodel Health, you receive:

Healthcare-focused expertise. We understand the unique workforce, compliance, and benefits challenges facing medical practices, clinics, provider groups, and other healthcare organizations.
Technology that simplifies administration. Our ICHRA+ platform integrates with more than 200 payroll and HRIS systems to reduce manual work and improve operational efficiency.
White-glove service. We guide employees through plan selection, enrollment, and the reimbursement process to maximize participation and satisfaction.
Results you can trust. With a 95% customer retention rate, Remodel Health has a proven history of helping organizations control costs while delivering better benefits experiences.

"Healthcare can be a highly competitive field, and ensuring your benefits retain top talent is key. I believe Remodel Health's highly skilled team & technology set us apart and ensure a smooth benefits rollout. With years of supporting healthcare organizations, we're able to tailor the experience to what your employees expect: shiftwork, leadership dynamics."

Kelsey Frizzell

Territory Sales Lead, Remodel Health

ICHRA for healthcare organizations

Understanding ICHRA for healthcare organizations

Why healthcare organizations are turning to ICHRA