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ICHRA in Texas

Texas is becoming one of the best states for implementing individual coverage health reimbursement arrangements (ICHRAs). With a large workforce and an increasingly competitive individual market, Texas employers are looking for more flexible ways to offer personalized health insurance benefits.

Remodel Health helps Texas businesses design and administer ICHRAs so they can better control costs while employees choose their own health insurance plans and providers.

ICHRA Texas

Why traditional group health insurance isn’t working for Texas employers

Like many other states, Texas employers are experiencing rising healthcare costs and limited flexibility in traditional group health plans. In 2026, many businesses are seeing increases of up to 30%1. For Texas employers with businesses statewide, these costs can vary significantly, making it difficult to budget and plan a long-term benefits strategy.

Group plans also don’t do enough to support the needs of a diverse or spread-out workforce. Texas employers with remote teams or workers in multiple cities tend to have limited or varying group plan options that may not meet every employee’s needs. Due to these challenges, Texas employers are starting to consider alternative benefit options that have greater flexibility, cost control, and personalization.

“Fully insured and self-funded group plans are becoming harder to sustain, especially for mid-sized employers. They’re too large for small-group simplicity, but don’t have the scale to effectively manage self-funding risk. These employers are looking for a way out, and ICHRA is increasingly the answer.”
Ben Whitehead_Remodel

Ben Whitehead

Territory Sales Lead, Remodel Health

Chapter 1: What is an ICHRA, and how does it work for Texas employers?
    
Chapter 1

What is an ICHRA, and how does it work for Texas employers?

An ICHRA is a flexible, employer-funded benefit that allows businesses to give their employees tax-free money to spend on individual health insurance premiums.

Instead of offering a one-size-fits-all group insurance plan, employers set a defined monthly contribution for their employees. These contributions can vary based on 11 job-based employee classes (such as full- or part-time employees and location), age, or family size, and have no annual limitations on the amount that you can offer.

To participate in the ICHRA, employees choose their own individual health insurance plans that meet minimum essential coverage (MEC) standards — either on a public or private exchange — that support their family’s goals and budgets. After enrolling, employees submit proof of qualified coverage, and they use their ICHRA employer contribution to pay for the monthly health insurance premiums.

With the ICHRA, employers can expect predictable costs and avoid premium rate hikes, while employees gain more choice and flexibility over their healthcare.

   
Chapter 2

Why does the ICHRA work so well in Texas?

Although the ICHRA can be ideal for many employers, regardless of size or geographic location, certain aspects of Texas make it a particularly successful benefit in the state.

Expanding provider networks across major carriers

Many Texas insurance providers are expanding their networks across the state, making switching to an ICHRA easier for employers. Carriers like Ambetter Health and Oscar Health are offering more plans across major metro areas and surrounding regions to better compete for larger employer groups entering the individual market after transitioning from traditional group insurance.

Having enough plan options for their employees is one of employers’ biggest concerns when moving away from group health coverage. With broader networks, employees can keep their preferred doctors, specialists, and hospital systems when selecting an individual health insurance plan, making the ICHRA more appealing and better utilized.

Competitive individual market rates

Texas stands out for its highly competitive individual health insurance market, driven by strong carrier participation and regional competition. Compared to many other large states, premiums in Texas are often better priced for employees, especially in densely populated rating areas where there are multiple carriers.

Better plan prices help employers' ICHRA contributions go further, making it easier to offer a valuable employee benefit without going over their budget. It also gives employees more plan choices at affordable prices, which they can then put their tax-free contribution toward to save even more money.

Increased market for ICHRA-specific plans

Texas has become one of the leading states for ICHRA-focused plans, as more carriers in the state are designing products tailored specifically to pair well with the ICHRA.

For example, Wellpoint (part of Elevance) introduced new “Essential ICHRA” plans in Texas for 2026, aimed at supporting larger employer groups transitioning from traditional coverage2. These plans are built with network design, pricing, and coverage structured specifically for the ICHRA, so the policies and the benefit compliment each other.

For Texas employers and insurance brokers, this new change means better plan quality, more predictable pricing, and smoother implementation of the ICHRA for employees.

Flexible plan designs with geographic employee classes

Texas’s size makes the ICHRA’s flexibility a big advantage. Healthcare costs can vary significantly between cities like Houston, Dallas, and Amarillo, making offering a single contribution amount an inefficient strategy.

With the ICHRA, employers can create geographic employee classes based on Texas’s 27 rating areas, allowing them to tailor contributions to local market conditions. Even better, geographic employee classes have no minimum requirement if you only offer an ICHRA, meaning employers can create a custom contribution amount even if they only have one employee in a certain rating area.

However, if you choose to offer an ICHRA and group health insurance to different classes of employees, minimum class size rules may apply.

This flexibility enables employers to control costs while ensuring employees receive contributions that work best for their geographic location.

“Texas has become one of the most compelling markets in the country for ICHRAs. Texas has more employers in the 50–1,000 employee segment than any state except California, more employers are quoting ICHRA in Texas than in any other state, and the state has one of the largest broker populations in the country. And perhaps most importantly, Texas leads the nation in the number of individual carriers offering plans. The ingredients for ICHRA success are all concentrated in one place.”
Ben Whitehead_Remodel

Ben Whitehead

Territory Sales Lead, Remodel Health

  
Chapter 3

Texas individual market carriers and health plans for 2026

Texas’s health insurance market has grown over the past several years to support the needs of employers, individual consumers, and new health benefits. With a wide range of carriers offering diverse plan options, Texans have more choices than ever when choosing health insurance coverage.

The following is a list of health insurance carriers offering individual plans in 2026:

Insurance Company
On- or off-exchange
Access to Care Health Plan
Off-exchange plans
Ambetter
On- and off-exchange plans
Baylor Scott & White Insurance Company
Off-exchange plans. Please note that Baylor Scott & White is leaving the individual market at the end of 2026.
Blue Cross Blue Shield of Texas
On- and off-exchange plans
CHRISTUS Health Plan
On- and off-exchange plans
Cigna HealthCare of Texas, Inc.
On- and off-exchange plans. Please note that Cigna is leaving the individual market at the end of 2026.
Community First Insurance Plans
On- and off-exchange plans
Community Health Choice
On- and off-exchange plans
Harbor Health
On- and off-exchange plans
Imperial Insurance Companies Inc.
On- and off-exchange plans
Moda Health Plan, Inc.
On- and off-exchange plans
Molina Healthcare of Texas, Inc.
On- and off-exchange plans
Oscar Insurance Company
On- and off-exchange plans
Scott and White Health Plan
On- and off-exchange plans
Sendero Health Plans, Inc.
On- and off-exchange plans
Superior Health Plan
On-exchange plans
UnitedHealthcare of Texas, Inc.
On- and off-exchange plans
Wellpoint Insurance Company
On- and off-exchange plans

 All table data from HealthCare.gov’s rate review3 and Ideon’s Planwatch4. See footnotes for Baylor Scott & White5 and Cigna information6. 

  
Chapter 4

ICHRA growth in Texas

ICHRA Texas2

ICHRA adoption is rising in Texas as employers seek more flexible alternatives to traditional group health insurance plans.

Here are some key data points showcasing the ICHRA’s growth:

  • According to the HRA Council, ICHRA adoption among applicable large employers with 50 or more employees grew 34% from 2024 to 2025. Some groups saw substantial growth of up to 49%7.
  • Small employer ICHRA adoption increased by 52% from 2024 to 2025.
  • Overall, employer adoption of the ICHRA rose 29% from 2023 to 2024 nationwide.
  • 292.7% year-over-year growth in ICHRA quoting via Ideon from 2024 to 2025.8
  • 83% of employers offering ICHRA in 2025 hadn’t previously offered health benefits.
  
Chapter 5

Why should Texas business owners work with Remodel Health?

Remodel Health is the largest and most experienced ICHRA administrator in the nation, meaning our team has the right tools to successfully transition employers of any size from traditional group insurance plans to personalized health benefits.

In a growing health benefits market like Texas, having the right ICHRA partner is crucial. Our ICHRA+® solution simplifies the process of designing and managing an ICHRA so you and your employees have the best experience possible.

What our ICHRA+ solution includes:

  • We’ll help you build a customized contribution strategy based on your workforce demographics, locations, and budget goals.
  • Our team provides hands-on support to help your employees understand their ICHRA so they can get the most out of their benefits.
  • During Open Enrollment or a special enrollment period, employees shop for individual health coverage through the Remodel Health platform, where they can filter by providers and compare plans. Those with complex medical situations have access to one-on-one guidance from Benefit Advisors. This helps them successfully enroll in a policy that fits their doctors, prescriptions, and budget.
  • We handle complex ICHRA requirements, including drafting plan documents and required employee notices, and supporting ongoing compliance management.
  • Our administrative platform automates the day-to-day management of your tax-free benefit, such as reviewing claim documentation, so you can focus on running your business.
  • Employers and brokers receive year-round assistance from our support team, who understand both ICHRA and the Texas market.

For smaller employers, Remodel Health’s PeopleKeep solution makes offering a qualified small employer HRA (QSHERA) or an ICHRA easy to manage with minimal administrative burden. And if you eventually grow to the size of an applicable large employer, our ICHRA+ solution is ready for you so you can have even more flexibility and hands-on customer service.

“ICHRA offers a model that is scalable, predictable, and employee-centric. And when paired with a full-service administration platform like Remodel Health, it becomes viable and compelling. When you combine high employer demand, a dense and active broker community, and the most robust individual carrier market in the country, you get a perfect environment for the ICHRA to thrive. And if the current trends hold, Texas will be the ICHRA market to watch.”
Ben Whitehead_Remodel

Ben Whitehead

Territory Sales Lead, Remodel Health

   
Chapter 6

Texas employers succeed with ICHRA thanks to Remodel Health

Employers across Texas are seeing the advantages of switching to an ICHRA. From improved cost control to better employee satisfaction, businesses of all sizes are turning toward the ICHRA as a more flexible and sustainable solution compared to traditional group plans.

Below are our case studies from Texas-based employers who have chosen Remodel Health as their ICHRA administrator and achieved success.

Remodel-Health-Staff-2025

Let’s talk through your ICHRA questions.

Navigating the health benefits landscape doesn’t have to be complicated. We’re here to guide you and your business every step of the way.

Contributors:

Elizabeth W staff photo

Elizabeth Walker

Content Marketing Specialist

Sources: