More employers are giving workers money to buy their own health insurance
A growing trend is changing how many Americans get health insurance: more employers are offering employer health insurance stipends instead of traditional group coverage. Rather than managing a group plan, employers give workers a monthly stipend to purchase their own individual coverage. Here’s how it works and what it means for Arizona workers and small business owners.
What Is an Employer Health Insurance Stipend?
An employer health insurance stipend — sometimes called a Health Reimbursement Arrangement (HRA) or Individual Coverage HRA (ICHRA) — lets employers give workers a set monthly amount to buy their own health insurance on the individual market. Workers choose their own plan, and the employer reimburses them up to the stipend amount.
According to the Department of Labor, Individual Coverage HRAs have made it easier for employers of all sizes to offer health benefits without managing a group plan.
Why More Employers Are Switching to Health Insurance Stipends
- Cost control: Employers set a fixed budget — no surprise premium spikes
- Administrative simplicity: No group plan to manage or renew annually
- Worker flexibility: Employees choose coverage that fits their doctors and needs
- Small business access: Even very small employers can offer meaningful health benefits
What Workers Should Know About Employer Health Insurance Stipends
If your employer offers an employer health insurance stipend, you’ll need to shop for individual coverage on your own. Key things to consider:
- You can use the stipend toward ACA marketplace plans or off-exchange PPO plans
- Your income may qualify you for additional ACA subsidies on top of the stipend
- Choosing the right plan matters — network access, deductibles, and prescription coverage vary significantly
- An independent broker can help you compare plans at no extra cost
Help Choosing Individual Coverage in Arizona
I’m Andy Orlikoff, an independent health insurance broker in Surprise, AZ. If your employer offers an employer health insurance stipend, I can help you find the right individual plan — ACA marketplace, off-exchange PPO, or short-term coverage — that maximizes your benefit.
Call or text: (623) 742-3878
Fill out the contact form →
Serving Surprise, Phoenix, Peoria, Glendale, Goodyear, Scottsdale, Mesa, Chandler, Gilbert, and all of Arizona.
American Insurance Benefits | 14955 W Bell Rd #8031, Surprise, AZ 85374 | Licensed Arizona Insurance Broker since 2004