Contrary to popular opinion, ICHRAs are not the cavalry coming to solve your company’s health care problems.
SureCo recently released its State of ICHRA Report for 2026, marking the first time ICHRA implementation crossed from an early experiment to a mainstream benefits strategy. While ICHRAs might look like a viable short-term option for some companies — particularly those with a remote, distributed workforce — they are not a real solution.
According to the study, 56% of brokers are now actively recommending ICHRAs, and for three consecutive years, more than 91% of adopting companies said it was the right decision.
But was it?
Simply put, ICHRAs are not the long-term, silver-bullet solution that will fix your clients’ health care dilemma. They may appear attractive, but a closer look reveals fatal economic chinks in their armor.
First, ICHRAs do nothing to address the root issue of rising costs. The fundamental premise of an ICHRA is a sleight of hand: converting a defined health benefit into a defined financial contribution. It doesn’t take Nostradamus to predict what happens as underlying health care costs continue to skyrocket. If an employer’s contribution is capped, who absorbs the increase? Your employees do. It represents the ultimate cost-shifting maneuver.
But the danger goes far beyond cost-shifting. While businesses might be able to slough off their headaches in the near term with an ICHRA, they are actively contributing to a longer-term macroeconomic disaster.
This brings us to a glaring disconnect in the industry. On one hand, companies with the absolute highest health care costs are desperately using ICHRAs as an exit ramp to dump their sickest employees onto the individual marketplace. On the other hand, ICHRA providers frequently boast that their enrolled populations are younger and healthier, claiming their specific risk pools are better.
If ICHRA vendors are actually achieving this, they are practicing “selection” in reverse. By cherry-picking the healthy and siphoning them out of traditional risk pools, they are artificially engineering their own short-term success. This is a mathematically unsustainable gimmick. Insurance relies on a balanced pool. By extracting the healthy, ICHRAs heavily concentrate the remaining high-cost risk onto everyone else.
Between employers dumping their sickest workers and vendors skimming the healthiest, this severe adverse selection guarantees that the public exchanges will inevitably blow up under the weight of concentrated risk.
And when those public exchanges collapse, the problem will fall right back into your clients’ lap. Employees facing astronomical marketplace premiums will demand massive wage increases to bridge the gap, or they will simply quit.
And when employers are eventually forced to bring health care back in-house to survive, your clients will be completely behind the eight ball. By retreating to an ICHRA, you forfeit the most powerful levers you have. You surrender access to your own claims data and lose all institutional experience in managing supply chain costs. Your clients will be forced to re-enter the self-funded market completely blind.
An ICHRA signals to your clients’employees: “Health care is too expensive, so you’re on your own.” A true strategic approach tells them: “Health care is too expensive, so we built a better system.”
Financial predictability and high-quality care come from building a real health plan, one where you control the economics instead of surrendering them. Self-fund, demand transparency and manage your supply chain.
Everything else — including ICHRAs — is just an illusion.