March 10, 2026

This piece is sponsored by Sanford Health.

Here’s your comprehensive guide to understanding the differences between an individual coverage health reimbursement arrangement, or ICHRA, and other health plans and accounts.

To fully appreciate the unique position of ICHRA, it’s helpful to compare it with other common health benefit arrangements. Each option serves different purposes and is suited for different employer and employee needs.

ICHRA vs. traditional group health plans

This is the most direct comparison as ICHRA often serves as an alternative to a traditional group health plan. Unlike group plans, ICHRA shifts the choice and responsibility for plan selection to the employee, while the employer controls the contribution amount. Group plans offer a pre-selected benefit with shared risk.

ICHRA vs. QSEHRA, or qualified small employer health reimbursement arrangement

QSEHRA is another type of health reimbursement arrangement, specifically for small employers. These allow employers to reimburse employees for health expenses. However, these plans come with strict allowance limits and broad employee offering requirements. Unlike QSEHRA, ICHRA is for any size employer, offers greater flexibility in allowance amounts/employee classes and has different rules regarding premium tax credits.

ICHRA vs. HRA, or general health reimbursement arrangement

It’s important to clarify that ICHRA is a type of HRA, and HRAs are a broad category of employer-funded accounts that reimburse employees for medical expenses. However, ICHRA has a primary focus on reimbursing individual health insurance premiums.

ICHRA vs. HSA, or health savings account

HSAs are employee-owned savings accounts for health care expenses, often paired with high-deductible health plans, offering long-term savings potential. ICHRA is an employer-funded reimbursement arrangement for premiums and expenses. It’s important to note that an employee with an ICHRA can choose an HDHP and open an HSA, using the ICHRA to cover premiums and the HSA for out-of-pocket costs, making them complementary.

For information about ICHRA or to walk through your health plan options, call Sanford Health Plan at 888-844-5809 or TTY at 711.