Options for employers
Small-group and SHOP plans
Small businesses (generally 1–50 full-time equivalent employees, up to 100 in some states) can buy ACA-compliant group health plans, including through SHOP. These plans cover essential health benefits and pre-existing conditions. Some small employers may qualify for the Small Business Health Care Tax Credit. See our small business page for details.
Health reimbursement arrangements (HRAs)
- Individual coverage HRA (ICHRA). In September 2026 CMS and the SBA began calling these "CHOICE Arrangements." The employer sets a monthly amount, and employees use it toward an individual health plan they choose, including Marketplace plans. Employers of any size can offer one. If the offer counts as "affordable" under IRS rules, the employee can't get a premium tax credit instead.
- QSEHRA. For small employers (fewer than 50 full-time employees) that don't offer a group health plan. The employer reimburses employees, up to yearly IRS limits, for health costs including individual premiums.
HRA rules are detailed. Talk with your tax professional or benefits advisor before you set one up.
Membership and association programs
Some companies sell "memberships" to individuals. Membership may come with discounts, services like telehealth, and sometimes a limited insurance policy. These can be useful when you know exactly what you're getting. But they are usually not ACA-compliant health insurance.
A few facts to know:
- Association health plans. A 2018 federal rule that widened these plans was mostly struck down by a court in 2019, and the Department of Labor rescinded it in 2024. Health insurance sold through an association is generally treated as individual or employer coverage under the usual rules.
- Bundled products. A membership may combine a discount card with a fixed indemnity or accident policy. The discount part isn't insurance. The insurance part is limited. Neither is comprehensive coverage.
- Regulators have taken action against some sellers that told people limited plans or discount memberships were comprehensive health insurance. Ask questions before you pay.
When a membership program can be the right choice
- You already have health coverage and want the specific discounts or services the membership offers.
- You understand exactly which parts are insurance, what they pay, and what you'll pay each month.
When an ACA or group plan is the better fit
- You need coverage for doctor visits, hospital stays, prescriptions, or a health condition.
- You might qualify for premium tax credits on an ACA plan.
- Your employer offers a group plan.
Questions to ask about any membership program
1. Which parts are insurance, and which insurance company issues them? 2. Is the insurance company licensed in my state? 3. What exactly does each part pay, and what are the limits? 4. Is this an ACA-compliant health plan? (If not, it doesn't have to cover pre-existing conditions or essential health benefits.) 5. What's the total monthly cost, and how much is the membership fee versus the insurance premium? 6. How do I cancel, and do I get a refund?
If something is offered as health coverage by a group that isn't a licensed insurance company, check with your state insurance department before you join.
How it compares to an ACA plan
| Small-group / SHOP plan | ICHRA / QSEHRA | Membership program | |
|---|---|---|---|
| ACA-compliant health coverage | Yes | Funds an individual plan, which can be ACA-compliant | Usually not |
| Covers pre-existing conditions | Yes | Through the individual plan | Usually not, if it includes insurance |
| Minimum essential coverage | Yes | The individual plan can be | Usually not |
Costs and how it's priced
Small-group premiums depend on employees' ages, location, the plan you pick, and how much the employer contributes. With an HRA, the employer chooses the amount. Membership program prices vary. Ask for the cost of each part separately.
How to get started with a licensed agent
1. Employers: tell us your number of employees, location, and budget. We'll compare group, SHOP and HRA options. 2. Individuals: tell us what coverage you have now. If you're looking at a membership program, we'll explain what's insurance and what isn't. 3. Review each option's costs and limits before you decide.
Frequently asked questions
Is a membership program the same as health insurance?
Usually not. Many membership programs combine discounts with limited benefits. Ask which parts are insurance and whether any part is an ACA-compliant health plan.
Can my small business offer health insurance?
Yes. Small businesses can buy small-group or SHOP plans, or offer an HRA that helps employees buy their own plans.
What is a CHOICE Arrangement?
It's the new name CMS uses for an individual coverage HRA (ICHRA). The employer gives employees a set amount toward an individual health plan.
Can I still get a premium tax credit if my employer offers an HRA?
It depends. If the HRA offer is "affordable" under IRS rules, you can't get a premium tax credit. Ask your agent or tax professional.
Are association health plans available?
The expanded federal rule from 2018 is no longer in effect. Coverage sold through an association generally follows the same rules as other individual or employer coverage.
Important information
Group coverage is underwritten by the insurance companies we represent. Some membership programs include a discount card, which is not insurance, or a limited-benefit insurance policy, which is not comprehensive health insurance. If a program includes both a membership and insurance, you are buying a membership and, separately, an insurance policy. We describe tax treatment only in general terms; ask a tax professional about your situation.
Offered by First Health Solution, LLC d/b/a Health Enrollment, a licensed insurance agency (NPN 17718619). Not a government agency. Not available in all states.
Last reviewed October 2026. Not available in all states. This page is general information; see the policy for complete terms.