If you’ve been talking to employers about Individual Coverage Health Reimbursement Arrangements (ICHRAs), there’s a new name you need to know: CHOICE Arrangements.
On September 3, 2026, the Centers for Medicare & Medicaid Services (CMS) and the Small Business Administration (SBA) officially began referring to ICHRAs as CHOICE Arrangements, short for Custom Health Option and Individual Care Expense Arrangement.
The name may be new, but the underlying concept is not.
For agents already familiar with ICHRAs, this is primarily a new name and a new opportunity to bring the model into employer conversations.
From ICHRA to CHOICE: A Quick History
The benefits model was first created following an executive order signed by President Donald Trump in October 2017, with the ICHRA model ultimately going live in 2020.
Since then, ICHRA has become an increasingly important alternative for employers looking to provide health benefits without sponsoring a traditional group health plan.
There have also been efforts to move ICHRA from its regulatory foundation into federal statute under the CHOICE name.
Those efforts included legislation considered by Congress in 2025 and 2026. Provisions that would have renamed and expanded ICHRAs as CHOICE Arrangements were ultimately not included in the version of H.R. 1 signed into law in July 2025. Later legislation again sought to codify the model and use the CHOICE name.
Now, however, CMS and SBA have officially adopted CHOICE Arrangements as the federal terminology for what was previously known as ICHRA.
That makes this an important terminology update for agents who work with individual health insurance and employer benefits.
What Is a CHOICE Arrangement?
At its core, a CHOICE Arrangement works much like the ICHRA model agents already know.
An employer provides employees with a defined contribution that can be used toward qualifying individual health coverage and certain medical expenses, subject to federal requirements.
Instead of the employer selecting a traditional group health plan for everyone, employees can choose individual coverage that better fits their own needs.
The employer establishes the contribution, while employees have more control over the coverage they select.
That flexibility is at the heart of the CHOICE name.
That can be particularly valuable for small businesses, employers with geographically diverse workforces and companies struggling with the cost or complexity of traditional group insurance.
What Does This Mean for Agents?
This is where the name change becomes especially important.
CHOICE Arrangements create another opportunity for agents to bring their individual-market expertise into the employer benefits conversation.
Consider the business owner who says:
“We want to offer health insurance, but traditional group coverage is too expensive.”
That conversation doesn’t necessarily have to end there.
Agents can introduce another approach:
“What if you could provide your employees with a defined contribution and let each employee choose individual coverage that works for them?”
That’s the conversation CHOICE is designed to facilitate.
Stay Ahead With Agility
The health insurance market continues to evolve, and new opportunities can emerge from regulatory changes, product innovation and changing employer needs.
At Agility Insurance Services, we’re committed to helping agents understand those changes and turn them into opportunities.
The Agility Difference
With the ongoing evolution of the insurance market, Agility empowers you to identify your defining characteristic through our team’s expertise, positioning you for growth. With Agility, you also get dedicated Producer Support at (866) 590-9771 or support@enrollinsurance.com to answer any insurance questions and direct you to our ACA, Medicare, and ancillary experts.
They can also add you to our weekly email list for tips and updates. Let Agility empower you to evolve your capabilities and capture the opportunities in 2026!
