Halfway through our dry run, we paused in the boardroom of a national health insurance company. Talking points refined. Slides polished. Empty chairs at empty tables, staring back at us. I didn’t linger on the silence then. Now, as a medical student, I cannot escape it. Because empty chairs look different here. Perhaps, they reflect the same fracture that plagues the reality of patients, providers, employers, and payors caught within the U.S. health system.
One year ago, Americans reckoned with the passage of the One Big Beautiful Bill Act (OBBBA). The landmark legislation cut Medicaid spending by $911 billion over 10 years. Then, critics lamented its failure to extend enhanced premium tax credits for individuals that purchase their insurance on the exchange. Even more disturbing is a drop in enrollment altogether. These important topics reflect a broader theme that occupies policy’s center stage: health care affordability.
Affordability, however, demands a finer scalpel than Medicaid alone. Recent KFF analysis found that employer-sponsored insurance (ESI) remains the cornerstone of U.S. coverage. Approximately 48 percent of the U.S. receives insurance from their employer. The OBBBA cut Medicaid in spades, but its inquisition into U.S. health care should have focused on health care’s undeniable ace: ESI.
Advocates of ESI have long touted its benefits. Historically, ESI has been characterized as less expensive than individually purchased coverage because it combines healthier and sicker patients into one risk pool and benefits from special tax treatment. Recent data from Mark Farrah Associates may indicate otherwise: in 2024, the average individual market premium ($540) was lower than ESI’s ($587).
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Furthermore, ESI confines employees to a one-size-fits-all model. Most employers, particularly smaller ones, cannot offer unlimited plan options. In fact, 66 percent of employers offered only one type of health plan in 2025. Unlike their choice in car insurance, cellphone provider, or Uber driver, employees cannot shop for insurance that meets their needs. This model doesn’t simply hurt employees. The burden of ESI is borne by employers and payors alike.
Imagine two employees at your local small business: Jason, a 26-year-old healthy shift leader and Sylvia, a 62-year-old manager with severe hypertension. Both are enrolled in the same plan. Jason pays for coverage he’ll never use. When Sylvia’s health takes a turn for the worse in July, the costs only mount higher. Sylvia takes out another mortgage, and out of necessity, the payor raises premiums. Jason, priced out, takes a job somewhere else.
Sylvia’s chair, like so many, now sits empty.
Employers cannot design a single plan that aligns the needs of two of their employees, much less 100. Payors are not motivated to provide longitudinal preventive health due to attrition in employment. This is not a failure of bad actors. The only consistent winner of employer-sponsored insurance is the cycle itself: rising costs, shrinking options, and empty chairs at tables that cannot afford to lose anyone else.
But there is a solution: incentivizing Individualized Coverage Health Reimbursement Arrangements (ICHRA) as the next generation for employer-sponsored health benefits. What on earth does this mean? Let’s break it down.
The Individualized Coverage Health Reimbursement Arrangement allows employers to provide a tax-free allowance to employees to purchase individual health insurance and pay qualifying medical expenses. Unlike Health Savings Accounts, ICHRAs can cover both premiums and cost-sharing. ICHRAs allow employees to keep the same plan when changing jobs, thereby improving continuity of care and enabling payors to manage care longitudinally.
Critics cite low ICHRA uptake from 2020 onward and fear employers might offload risk to the individual market. However, this has largely been limited by the restriction against employers offering ICHRAs alongside traditional group plans in the 2019 ICHRA Final Rule. So, ICHRAs remain foreign to employers not looking to risk bucking the status quo.
ICHRAs represent a new frontier where payors compete, employers control expenditures, and patients choose plans that fit their needs. ICHRAs solve two limitations of ESI: offering more choice for employees to select the plan that best suits their needs, and aligning incentives for payors to provide preventive care and population-health management longitudinally.
Congress and HHS must modernize the 2019 ICHRA Final Rule to allow employers of all sizes to offer ICHRAs alongside traditional group plans. They should reward employers that decouple health coverage from the ESI monolith. This would encourage employers to pilot next-generation ICHRA designs that permit employees to select plans that fit their needs. And, ICHRAs boast bipartisan support with origins in both the Obama administration and the Trump administration.
I have seen this fractured system from the boardroom and the bedside. ICHRAs offer a reform that would benefit both rooms. It is time to dispel the illusion of employer-sponsored health insurance. The question is how much longer we can afford it, before another chair at America’s table sits empty.
Evan C. Wells is a medical student.
