CHOICE Arrangements (formerly called ICHRA), can give your team a set amount each month to purchase their own health plans. We’ll run the numbers for you against a traditional group plan, so you can see both sides before you decide.
CHOICE Arrangements (formerly called ICHRA), can give your team a set amount each month to purchase their own health plans. We’ll run the numbers for you against a traditional group plan, so you can see both sides before you decide.
A CHOICE Arrangement is the new name for an ICHRA (Individual Coverage Health Reimbursement Arrangement). In September of 2026, the federal government began calling it a Custom Health Option and Individual Care Expense Arrangement. The rules stay the same, the only change is the name.
Simply put, instead of picking out one group plan for your team, you can set up a monthly dollar amount for each individual employee. They’ll buy their own individual health insurance plan, and then you reimburse them up to that amount. The reimbursements can cover their monthly premiums and even any out of pocket medical expenses too, if you choose.
Think of it like a monthly allowance for health care. One employee might want to have a high deductible plan with a lower premium, while another might want more coverage for their growing family. The decision sits with them, not with HR.
And with employer coverage, the reimbursements are tax-free for employees and tax-deductible for the business.
Already have an ICHRA? No need to do anything! Your plan, payroll setup, and communications with employees still apply.
We’ll say it upfront: Utah has a pretty strong group health market. For a lot of employers across the Wasatch Front, a traditional group health plan still comes out ahead based on value. A CHOICE Arrangement isn’t automatically the cheaper path.
But we’ve noticed that for some businesses, the math has shifted. Enhanced marketplace subsidies from COVID ended after 2025, so some people who buy their own health coverage are paying more for it now. If you have employees in that position right now, a CHOICE Arrangement could give you a way to help without committing to a full group plan.
It also solves a few problems that traditional group plans can’t:
We don’t guess which structure fits. We compare them side by side. Here’s how it goes:
You decide the dollar amount. They decide the plan.
Employees can enroll through the marketplace or directly with a carrier. Buying off the marketplace lets them pay any amount above your allowance with pre-tax payroll dollars, which is why many setups go that route.
Restaurants, hotels, and other businesses that struggle to meet group plan participation requirements
Employers with teams spread across Utah and other states
Businesses that want a flat monthly cost, no matter what premiums do
Employers who want to help employees who lost subsidized coverage, without waiting for open enrollment
Let’s schedule an appointment or jump on a call.
Q: Is a CHOICE Arrangement the same thing as an ICHRA?
A: Yes, CHOICE Arrangement is the new name for an Individual Coverage Health Reimbursement Arrangement (ICHRA), which was announced in September 2026. The eligibility and contribution rules are the same, and existing ICHRAs keep running as they are.
Q: Will a CHOICE Arrangement save my business money?
A: It’s possible. Everything depends on your group’s size, your employees’ ages and incomes, and whether they’d qualify for a marketplace subsidy otherwise. We’ll compare the group and CHOICE numbers before you decide.
Q: Is a CHOICE Arrangement (ICHRA) a better fit than a group plan in Utah?
A: Not by default. Utah’s group market is strong enough that many local employers still do well with a traditional plan. A CHOICE Arrangement tends to fit specific situations: multi-state teams, high-turnover industries, or businesses that can’t meet group participation minimums.
Q: How many employees do I need to offer a CHOICE Arrangement?
A: Businesses of any size can offer one, as long as there’s at least one employee who isn’t an owner or an owner’s spouse. Owners themselves can’t use it for their own coverage.
Q: What’s the difference between an ICHRA and a QSEHRA?
A: A QSEHRA is built for small employers with fewer than 50 full-time employees, and it has annual contribution limits. With a QSEHRA, an employee may still get a reduced premium tax credit. With a CHOICE Arrangement, there are no contribution limits, and employees can’t combine it with a premium tax credit. If the CHOICE offer isn’t affordable, they can turn it down and use the credit instead.
Q: Can employees on Medicare use a CHOICE Arrangement?
A: Yes. Medicare Parts A and B, or Part C, count as qualifying coverage, so employees on Medicare can be reimbursed for eligible premiums.
Q: When can we start a CHOICE Arrangement?
A: Any time of year. A January 1 start lines up with individual Open Enrollment. A mid-year start usually gives your employees a Special Enrollment Period to pick a plan.
Q: Does Ark handle compliance for a CHOICE Arrangement?
A: We handle the insurance side: quotes, plan design, and coordinating with your administrator. For payroll filings or ACA reporting, we bring in specialized partners, and we’ll point you to a CPA for tax-specific questions.
Q: How do we get started?
A: Send us a census of your team. We’ll run the numbers both ways, group and CHOICE, then sit down with you and walk through what makes sense.
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