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Survey: 20% of Large Employers Interested in ICHRAs

Analysis  |  By Melanie Blackman  
   November 16, 2020

The Willis Towers Watson survey also found 15% of employers are planning to offer employees individual coverage health reimbursement arrangements (ICHRAs) "in 2022 or later."

Willis Towers Watson (WTW) released data from two surveys Monday morning which found employers have a strong interest in individual coverage health reimbursement arrangements (ICHRAs).

This new benefit can help employers "keep their costs fixed by giving employees the opportunity to manage their own health care benefit choices and spend,” the report stated.

The WTW 2020 Health Care Delivery Survey found 15% of employers are "planning to offer or considering offering ICHRAs to at least some portion of its employees” in 2022 or later.

Due to a 2019 IRS ruling, employers have the availability to offer ICHRAs this year. According to WTW, employers can decide where medical benefit dollars are spent by “purchasing individual insurance coverage and then receiving a reimbursement through an employer-sponsored health reimbursement arrangement."

One-fifth of large employers were planning to “offer or considering offering ICHRAs” to at least some portion of their employee base.

Similarly, the forthcoming WTW 2020 Health Care CFO Survey found one-third of CFOs "are considering ICHRAs” for some portion of their employee base as well.

The survey found nearly 30% of employers in the public sector and education, and 22% of educators in wholesale and retail employers "are planning to offer or considering offering ICHRAs” in 2022 or later.

"Not surprisingly, relatively few employers adopted ICHRAs this year, as the pandemic diverted much of their attention to other critical benefit matters," John Barkett, senior director of policy affairs, benefits delivery and administration for WTW, said in a press release. "However, we expect to see interest grow as companies learn more about ICHRAs and the market for individual health plans continues to grow more robust each year … As more employers adopt the ICHRA approach, employees could find relief from the burden of having to change plans whenever they change jobs."

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Melanie Blackman is the strategy editor at HealthLeaders, an HCPro brand.

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