Portable Benefits Gain Traction As Employers Rethink Health Coverage Models

Portable benefits are moving from policy discussion to workforce expectation. Employees increasingly want coverage they can keep when switching jobs, pushing employers to rethink how benefits are structured and delivered.

Robin Paoli, Executive Director of the HRA Council, a non-partisan advocacy group focused on health reimbursement arrangements and employer-sponsored coverage, says portability reflects a shift toward benefits that function more like consumer products. "One of the trends is self-owned, portable benefits that travel with us in the same way our cell phone numbers do. More people want that for their benefits," she says.

Employer-sponsored coverage still dominates the U.S., but rising costs erode participation among smaller firms and shift more expenses onto workers. As workforce mobility increases, employers are rethinking whether tying coverage to a single job remains sustainable, helping explain why portability and employee-controlled benefits are gaining traction.

• Unlocking ownership: Individual Coverage Health Reimbursement Arrangements give employees control over their health coverage while providing employers flexibility. Companies contribute a tax-free amount that workers use to purchase insurance through ACA marketplaces, shifting benefits from a fixed plan to personal choice. Paoli highlights a 3,500-employee company that struggled with low participation and high costs under a traditional group plan and solved the issue with ICHRA. "When people pick their own insurance, it stays with them even if they leave. When you own your benefits and know you will not lose them, you gain the ability to make decisions about your own future," she says.

• Crossing the aisle: For large employers, a key question is whether ICHRAs will endure. The model has persisted through multiple administrations, showing resilience and bipartisan support. Codifying it into law provides long-term certainty and simplifies workforce transitions. Paoli says, "It's good, bipartisan public policy that meets objectives both Democrats and Republicans have."

ICHRA adoption relies on a coordinated support network. Success depends on brokers trained in ICHRA rules, third-party administrators who manage compliance efficiently, and partners who understand the full process. Employers who assemble the right ecosystem can smooth implementation, reduce administrative risk, and ensure employees fully benefit from the flexibility of the model.

• Back to business: Running traditional group plans diverts HR resources from core priorities, but ICHRAs let employees manage their own coverage. This frees HR to focus on talent retention, workforce planning, and broader strategic initiatives. "My number one piece of advice is to choose partners who will support your journey," Paoli says.

• Courting the consumer: "A sea change is coming for carriers. They are shifting from negotiating with bulk purchasers to meeting the needs of consumers. Instead of one person negotiating for 3,500 lives, multiple insurers are now competing for the business of 3,500 individuals," Paoli says. Insurers such as Ambetter and Oscar are adapting plan designs to respond, showing how individual choice is reshaping competition and benefits structure.

Misunderstandings about ACA-compliant individual plans continue to shape employer decisions, but Paoli says the perception of inferiority doesn’t hold. Wider adoption depends on companies and employees rethinking what quality in coverage means. When benefits are evaluated for fit rather than hierarchy, employers can expand options without sacrificing protection. "If it's an ACA-compliant plan, it provides good coverage. It's just a matter of what kind of good you need," she says.

*The views expressed in this article are those of Robin Paoli and do not reflect the official positions of any organization.