As a broker, you’re breathing a sigh of relief that open enrollment has ended. But many of your clients now feel the pain of buyer’s remorse. After yet another year of high group rate increases, they had to make tough decisions about their employee benefits. These choices came at a cost—either to their budget, employees, or both.
Your clients may have had to:
- Absorb the cost of the group plan increases to continue offering affordable health insurance to their employees
- Decrease the portion of the health insurance premium they covered to afford to continue offering the group benefit
- Offer a less appealing plan with a narrower network or higher deductible to offer an option that was affordable to both them and their employees
- Cut ancillary benefits, like vision or spousal life insurance, to be able to fund health insurance premiums at the same level
- Eliminate incentive programs, like smoking cessation, weight loss, or fitness rewards, to be able to fund health insurance premiums at the same level
Now, either your client is unhappy because they’ve realized their business can’t withstand the additional costs they absorbed, or they’re afraid of employee turnover because of how dissatisfied employees are with the benefit changes.
You have a couple of choices:
Does a midyear switch make sense for your clients?
Defined contribution plans like ICHRAs are antidotes to group plan regret
Fortunately, Individual Coverage Health Reimbursement Arrangements (ICHRAs) can remedy your clients’ group health plan challenges.
Unlike traditional group plans (a defined benefit approach), ICHRAs are a defined contribution approach that allows employers to reimburse employees tax-free for their individual health insurance premiums. Employees use their monthly contribution from their employer to purchase an individual health insurance policy of their choice (and, in some cases, can use any remainder to pay for ancillary benefits, too).
And here’s the kicker: employers can switch to an ICHRA health insurance plan anytime during the year because offering one creates a special enrollment period (SEP) for employees. This SEP allows employees to shop for and choose an individual policy outside the annual enrollment window.
That pain your clients are experiencing from their group health plan? You can help them solve it now.
3 compelling reasons to switch to an ICHRA now
You might think it would be a hard sell to convince your client to go through open enrollment again. However, switching to a defined contribution health plan, such as an ICHRA, has several significant advantages that make the switch worth it for most employers:
- Enables cost control: With a defined contribution health plan, employers have complete control over setting their health benefits budget. Employers set their budget by defining exactly how much they will contribute to employees each month—no more surprises from annual group rate renewals.
- Provides an opportunity to offer additional benefits: Employers can use the savings gained from switching to an ICHRA to introduce (or reintroduce) additional benefits employees will value, like vision, dental, life insurance, a dependent care FSA, or incentive programs like smoking cessation. Using a payment technology that enables seamless payments across benefits products can make this defined contribution approach even more appealing.
- Delivers increased employee choice and satisfaction: With an ICHRA, employees get the freedom to choose whichever individual policy best fits their unique needs from the individual marketplaces in their area. In 2025, states have an average of 9 insurers offering policies in the individual marketplaces—giving employees access to a much broader range of coverage options than a typical group plan. This choice is important— with employees regularly reiterating how much choice in their benefits matters.
These three benefits are the ones your clients will feel most immediately, but ICHRA offers additional benefits for the long term. For example, ICHRAs:
- Get employers out of the business of picking which plan(s) are best for their employees and handling annual renewals
- Create new opportunities to offer part-time and seasonal employees access to employer-provided benefits
- Offer tax advantages to both employers and employees
- Have none of the participation requirements that create the lack of breadth and depth in group coverage
- Provide coverage portability, meaning employees can keep their coverage even if they leave the company
ICHRAs as a strategy to retain clients and commissions
The reality is that the pain of group health benefits is becoming too severe for many employers. Something has to give. If you don’t present ICHRA as an option to them first, your clients will likely hear about the option elsewhere and make the switch without you.
The good news is that ICHRAs aren’t just compelling for employers. They make sense for you, too.
When you move your client to an ICHRA plan and use Nexben as your payment technology, you can:
- Retain your status as the agent of record and earn a commission on any individual policies purchased by employees
- Choose to send your client to one of Nexben’s enrollment partners or distribution partners if you would rather not be responsible for helping employees enroll in individual policies. In these scenarios, the partner assumes the agent of record, helps employees shop for coverage, and will compensate you based on their referral or advisory fee structure.
Don’t let your clients feel trapped in a system that isn’t working for them. Step up to help them alleviate their financial and employee retention concerns with a defined contribution approach to benefits. A change like this will help your clients thrive, deepening their trust in your expertise and counsel.
About Nexben
Nexben is a financial technology company that helps users reap all of the advantages of defined contribution benefits. Get in touch if you’d like to learn more about how offering Nexben can help you deliver the best options to your employer clients and their employees.