ICHRA is now the CHOICE Arrangement. What actually changed?

Did your broker just send you something about a "CHOICE Arrangement"?

It's the ICHRA. Same benefit, new name, as of September 3, 2026.

Why it matters: CMS and the SBA renamed the Individual Coverage Health Reimbursement Arrangement to the Custom Health Option and Individual Care Expense Arrangement. Nothing about how it works changed. Plenty of vendor copy this month is blurring that line.

What is actually true today:

• The rules did not move. Eligibility classes, affordability tests and the underlying 2019 regulations are unchanged.
• The IRS still says ICHRA. No document-amendment deadline has been announced. Your existing plan documents remain valid.
• Both names will be in use for a while. Carriers, brokers, contracts and Google searches still say ICHRA.
• The tax credit did not pass. Bills in Congress proposed a small-employer credit, a 60-day notice window instead of 90, and pre-tax cafeteria-plan premiums, all under the CHOICE name. None of that is law. If someone is selling you on those, ask them to cite the statute.

What to do: leave the technical terminology in your plan documents until your administrator or counsel updates it. Change your marketing and your conversations now, because "employee choice" explains the model better than an acronym nobody can pronounce.

The mechanism is unchanged either way. You fund a fixed monthly amount, employees buy their own individual coverage, and an unpredictable renewal becomes a budget line you set. Typically 8 to 15% below group cost, and it can start any month.

If you have been putting this off because the name was confusing, the name is now the easiest part of it.

When did you last compare what your group plan costs per employee against a fixed allowance you control?

Sources: https://www.cms.gov/marketplace/employer-initiatives https://www.sba.gov/about-sba/priorities/sba-initiatives/healthcare-options-for-small-businesses-choice-arrangements/