A decisive moment for employers’ health benefits: how the “Big Beautiful Bill” could transform health care for employers

On May 13, 2025, the American way and means committee presented a bill to extend the 2017 tax reductions. The reconciliation bill, currently under study at Congress, included several fascinating provisions for health care sponsored by the employer who positioned consumers at the center.

The “One Big Beautiful Bill” would codify the health reimbursement agreements of individual coverage (ICHRA) – the personalized insurance model which has transformed the way employers offer health services – in law as provisions of choice, or personalized health option and individual care expenses agreements.

The proposed change represents a step towards more personalized and flexible health benefits that respond to today’s workforce. Although the fundamental concept remains the same – the reimbursement funded by employers for individual coverage – the bill suggests improvements, including a period of rationalized notice and the possibility of bonus payments before taxes on the stock market.

These provisions could inaugurate a new era where employees have greater control over their health care choices, and employers can offer quality advantages in a more profitable and effective way.

Benefits of small high -level businesses

According to the Chamber of Commerce of the United States, small businesses employ almost half of the American workforce and represent 43.5% of American GDP. However, only 30% of small businesses offer health insurance – down 47% in 2000 – with costs that push many small employers to lower their health services.

The proposed bill has a new tax credit to prevent small businesses from being safe from health services. Companies of less than 50 full -time employees who adopt choice agreements may receive a two -year tax credit of $ 100 per month per employee registered ($ 50 per month in the second year).

We have already seen tax incentives on small businesses working in Indiana, and other states are considering similar legislation. We think, and hope, this will create more opportunities for small businesses to support their employees.

Increased affordability, reduction in administrative burden

The only major bill proposes to authorize payment before tax for individual health insurance premiums purchased on the scholarship – something currently available with Medicare or Off -Change via a cafeteria plan. This is a significant change, which represents real savings for employees.

By authorizing before tax payments, the effective cost of health insurance premiums would decrease for employees, increasing the appeal and affordability of stock market coverage. Employers would benefit from the drop in payroll taxes and more attractive advantages to help recruit and keep talents.

The bill could also see the notice period of the employer reduced from 90 to 60 days. The notice period is the number of days before the start of the plan according to which employees should receive information on the HRA, including the amount in dollars and if the offer extends to dependents. A rationalized opinion could facilitate administrative charges and would be greeted by employers who consider the requirement of 90 days as a point of pain.

Feed health savings accounts

The bill includes fascinating provisions for health savings accounts (HSAS) – The insurance model that combines a high health insurance scheme (HDHP) with a tax savings account. By redefining HDHP to include any bronze or catastrophic plan on the individual market, the Medicare part and certain direct primary care agreements (DPC), the number of HSA compatible plans could multiply.

The only large invoice also widens what HSA funds can pay, with sports expenses such as gym subscriptions and potentially refundable home fitness equipment. Since the list of qualified medical expenses is the same for HSA and ICHRA, employees of an ICHRA covering reimbursements for eligible expenses also benefit from it.

Encourageing the American public to stay healthy is a common sense stage towards cost control for individuals, employers and the health system as a whole – something that we can all be late.

What is the next step for the only big nice bill?

Health insurance is only a much higher aspect of the invoice considered. We know that this is a partisan bill; However, it’s just in the fairway for Ichra and ACA. ARH has been popular on both sides of the aisle since their introduction. They bring more lives to the individual market – an important objective for Democrats – and offer a choice and flexibility of consumers – things that the Republicans are behind. The evolution of the ICHRA in the provisions of choice promises to create a health system where patients have more agency, where providers are encouraged to provide high -value care centered on the patient and where services are better coordinated to meet the individual needs of each consumer.

Although there are still many details that are still in the air and a long trip to a signature in the oval office, I keep my eye on this. Employers, employees and legislators on both sides of the aisle recognize the advantages of enlargement of access to HRA. Whether Big Beautiful Bill adopts or not in its current form, Congress should not transmit this opportunity to codify the Ichras in law and provide each American with a real choice with regard to his health care.

Photo of Jabin Botsford / The Washington Post via Getty Images

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