Updated August 26, 2026 · current for the 2026-2027 plan year
A group plan prices your whole company as one risk and renews at whatever the carrier decides. An ICHRA gives each employee a tax-free monthly allowance to buy their own plan, and your cost is exactly the number you set. See both, side by side, for your headcount.
We never sell your information. By submitting you agree a licensed VS Health Benefits advisor may contact you about coverage.
Price is where owners start, but it is rarely where the decision lands. These are the things that make one option workable and the other one not.
A group plan renews at whatever the carrier quotes, and Florida small group renewals commonly land 8 to 15 percent higher year over year. An ICHRA allowance is a number you set. It moves when you decide it moves.
Most carriers will not issue a small group plan unless about 70 percent of eligible employees enroll and you cover at least half the premium. If some of your team is on a spouse’s plan, that math can fail. An ICHRA has no minimum size and no participation requirement at all.
An employee who accepts an ICHRA gives up their premium tax credit for those months. In a lower-wage workforce where many people qualify for large subsidies on their own, that can leave employees worse off even when the allowance looks generous. In a higher-wage one it costs them nothing.
A group plan gives everyone the same one or two options and one renewal meeting. An ICHRA means each employee picks their own plan, keeps their own doctors, and takes it with them if they leave. That is either the main benefit or the main headache, depending on your team.
Often, but not always, and the honest answer is that the real difference is control rather than price. With a group plan your cost is whatever the carrier renews at. With an ICHRA your cost is exactly what you budget, and it does not move unless you move it. Whether it is cheaper on day one depends entirely on the allowance you set versus the premium your group would be quoted.
No. Federal rules set no minimum company size and no minimum participation rate, so a business with two employees can offer one. Small group coverage is different: carriers commonly require 70 percent or more of eligible employees to enroll, plus at least 50 percent employer contribution, before they will issue the plan at all.
If they accept it, yes. An employee who takes an ICHRA is treated as having minimum essential coverage and cannot claim a premium tax credit for any month it covers. They may turn the ICHRA down and keep the subsidy if the allowance fails the federal affordability test. This is the single most important thing to check before switching a lower-wage team.
Yes, within rules. You may vary by age and by number of dependents covered, and you may set different allowances for defined classes such as full time, part time, salaried, hourly, or by location. Age variation is capped at three to one, so your oldest employee’s allowance can be at most three times your youngest employee’s.
Yes, but not to the same class. You cannot offer one employee a choice between the group plan and an ICHRA. You can, for example, put full-time employees on the group plan and part-time employees on an ICHRA, as long as the classes are defined properly. Getting the class definitions wrong is the most common way these arrangements fail an audit.
Because this comparison uses regional averages, and the number that decides it is your actual group quote, which only a carrier can produce. A licensed advisor can pull real rates for your census and tell you which way the math falls for your specific team. Your email is optional, and there is no cost or obligation.