CMS, SBA, and Georgia recognize Innovative Choice Arrangements as major win for small businesses

The following information was released by the Centers for Medicare & Medicaid Services (CMS):

Trump Administration Initiative Expands Resources for Health Insurance Affordability, Choice, and Coverage Options for Small Businesses and Workers

The Centers for Medicare and Medicaid Services (CMS) and the U.S. Small Business Administration (SBA) are raising awareness of CHOICE Arrangements - a proven tool that enables some small employers to offer health benefits at a fraction of the cost of traditional group insurance. Formerly known as Individual Coverage Health Reimbursement Arrangements (ICHRAs), CHOICE Arrangements allow businesses to set a predictable monthly budget for health benefits instead of absorbing the rising, unpredictable premiums of traditional group insurance plans.

At an event earlier this month in Indiana, CMS Administrator Dr. Mehmet Oz and SBA Administrator Kelly Loeffler unveiled the rebranded program and new resources to help employers understand potential cost savings and how to get started.

Building on that momentum, Administrator Oz joined Georgia Insurance and Safety Fire Commissioner John F. King and others in Atlanta to launch Georgia Access For Business, an innovative program that lets employers offer health benefits to their employees.

"CHOICE Arrangements let workers choose coverage that meets their unique healthcare needs, which can often offer better options than traditional employer plans," said CMS Administrator Dr. Mehmet Oz. "I'm excited to partner with Administrator Loeffler to promote this underused option that combines many of the tax benefits of traditional group plans with the flexibility of purchasing coverage independently. And I urge small business owners across the country to take advantage of the resources we're unveiling to determine whether a CHOICE Arrangement is the right fit for their workforce."

"The strong leadership of President Trump, Secretary Kennedy, and Dr. Oz has resulted in more affordable health insurance alternatives for America's small businesses through CHOICE Arrangements," said SBA Administrator Kelly Loeffler. "For too long, small employers, which are also America's most effective job creators, have been priced out of a health insurance market where prices only go up, and coverage goes down. These plans can change that. Employers set a monthly contribution level, and employees pick the qualifying plan that suits their families; it's a win-win. This flexible model gives employers greater control over healthcare costs and American workers more freedom to choose coverage that works for them and their families. The SBA is proud to partner with CMS to connect small businesses across the country with this powerful cost-saving tool."

Established under President Trump's first Administration, ICHRAs created a new alternative to the traditional group health insurance model by allowing employers to provide tax-favored contributions that employees can use to purchase qualifying health coverage. Employees can select qualifying coverage that fits their family's needs and includes their preferred doctors, rather than being locked into a one-size-fits-all plan.

Under the new CHOICE Arrangements branding, CMS is providing employers with new educational resources and tools designed to make them easier to evaluate and implement, including information to help small businesses understand costs, contribution structures, and third-party administration options.

For small businesses, the benefits of CHOICE Arrangements include:

Predictable costs.The plans offer a more flexible, predictable approach to providing health benefits by allowing employers to set their contribution while employees select individual coverage that meets their needs.

Tax advantages.Employer contributions to CHOICE Arrangements are generally deductible as a business expense, while reimbursements formonthly premiums and qualified medical care expenses are generally tax-free to employees.

Lower administrative burden. The model can be especially valuable for small employers seeking an alternative to traditional, complex group coverage, including those looking to offer benefits for the first time while remaining competitive with larger employers.

Scalability.Employers of any size with at least one W-2 employee can establish CHOICE Arrangements.

The Administration is pairing greater coverage choice with concrete action to lower healthcare costs and expand access. President Trump's Great Healthcare Planadvances lower prescription-drug prices, reduces insurance premiums, provides stronger insurer accountability, and enhanced price transparency. TrumpRx.gov hasdelivered savings on more than $700 million in medications, while the Working Families Tax Cut legislationcreated the historic $50 billion Rural Health Transformation Program through CMS to protect and expand access to care for rural communities. Together, these policies are giving America's small businesses, workers, and families more choice, lower costs, and better access to care.

To learn more, visitwww.cms.gov/choicearrangements,www.sba.gov/about-sba/priorities/sba-initiatives/healthcare-options-for-small-businesses-choice-arrangements/, or https://georgiaaccess.gov/georgia-access-for-business/.