ICHRA Renewal Checklist - How to Use Final ACA Rates to Confirm Your Client’s Strategy

Contents

A due-diligence guide to help benefits consultants support ICHRA (now known as CHOICE Arrangements) renewals and upcoming implementations.

Every fall, final individual-market rates give benefits consultants an opportunity to bring their clients’ renewal and implementation planning into focus. Carriers submit preliminary rate filings in the spring and summer,¹ followed by regulatory review and final approvals. Once final rates are available, you can compare them with the projections used to develop the client’s contribution strategy.

For 2027, cost pressures affect both individual and employer coverage, while final approved rates vary by state and carrier.^1-3 Reviewing the client’s available options helps you assess how the planned contributions support their budget, employee affordability and coverage goals.

This guide provides a structured checklist to support that due diligence, document your findings and identify helpful next steps. It centers on one question for each client: Does the projected strategy still work?

From projections to final rates: Validating your client’s ICHRA strategy

Final approved premiums give benefits consultants a clearer basis for comparing the client’s original projections with the coverage costs available to their workforce. Reviewing those premiums alongside planned allowances helps you confirm whether the strategy continues to support the client’s budget, affordability and coverage goals, and identify where refinements or additional support may help.

2027 ACA rate trends: How do other coverage markets compare?

These trends provide context for your client’s review, including how cost pressures compare across coverage markets and where individual plan choice may offer flexibility.

Individual-market proposals moderated overall, with variation by market. KFF’s nationwide analysis found a median proposed premium increase of 15% for 2027, compared with 18% proposed for 2026. These figures reflect insurers’ requests rather than final approved rates. Some carriers proposed substantially higher increases, reinforcing the importance of reviewing final premiums for the specific plans and locations relevant to your client’s workforce.¹
Small-group coverage faces similar cost pressures. KFF found a median proposed increase of 14% among small-group insurers for 2027, close to the individual market’s 15%. Rising medical prices, prescription drug costs and utilization are contributing to increases across both markets.^1,2
Cost pressures extend to larger employer plans. WTW’s September survey projects 11.1% growth in employer healthcare costs for 2027 before plan changes. Although employer cost projections and insurer premium increases measure different things, both point to broader healthcare affordability challenges.³
Individual plan choice creates options at renewal. With an ICHRA, employees can reassess their plan and carrier during Open Enrollment. If their current plan has a substantial premium increase, they can explore other eligible individual plans available in their area and apply their employer’s allowance toward the coverage they select. Take Command’s licensed advisors can help employees compare premiums, benefits, provider networks and prescription coverage to understand their options.
Client-specific comparisons guide the review. Compare final premiums and available plans with the original projections and planned allowances. National medians provide context, but this review shows how the contribution strategy supports the client’s workforce and where additional guidance or adjustments may help.

Why final approved rates differ from proposed rates

State regulators review insurers’ proposed rates and supporting information to assess whether the requested changes are justified. Insurers may also revise their requests as additional data becomes available. Final approved increases can therefore be lower than, higher than or close to the initial requests.^4,5

For 2027 coverage, CMS’s timeline calls for public posting of final rate information by October 30, 2026, ahead of Open Enrollment beginning November 1. States may publish earlier, so final rates can become available at different points in the planning cycle.⁶

For strategies modeled earlier in the year, final rates provide a checkpoint for comparing approved premiums with the original projections. The following state averages illustrate how proposed and approved increases can differ; individual employees’ results will depend on their carrier, plan, age and location:

New York approved an average individual-market increase of 6.0% after insurers requested 20.6%⁴
Connecticut approved 11.3% for the individual market against a requested 16.2%⁵
Oregon approved a 21.6% individual-market increase, which came in above the 17.5% initial request⁵
Washington approved 22.2%, close to the 22.4% requested⁵

Carrier participation can also shift. For 2027, Ambetter is leaving Delaware’s ACA market,5 and Medica is leaving the individual marketplace in Iowa, Oklahoma and the Kansas City area of Kansas, affecting about 13,000 enrollees.⁷ Where a carrier exits, review the remaining options and identify affected employees who may need additional enrollment guidance. Take Command’s licensed advisors can help those employees compare available plans and understand differences in premiums, benefits and provider networks.

Whether the client’s contribution strategy was modeled using preliminary filings or an assumed rate increase, final premiums provide the next checkpoint. Compare them with the original projections to confirm how the planned allowances support the client’s goals and identify any contribution refinements or employee support needed.

How final rates affect an ICHRA contribution strategy

Reviewing final premiums alongside planned allowances helps benefits consultants assess four areas: affordability, employee premium costs, the employer’s contribution budget and differences across the workforce.

Affordability

For applicable large employers (ALEs), assessing ICHRA affordability is part of evaluating compliance with the ACA’s employer mandate. Smaller employers are not subject to that mandate, although ICHRA affordability can still affect employees’ eligibility for premium tax credits.^8,9

Final rates may change the allowance an ALE needs to meet the affordability standard. That assessment generally uses the lowest-cost silver premium for self-only coverage available to the employee, based on their age and the rating area where they live, unless an applicable safe harbor is used. If that benchmark premium is higher than projected, the planned allowance may need to increase; if it is lower, the allowance may already meet the standard. Review the calculation using the affordability percentage and employee information applicable to the new plan year.^8-10

For more background on how affordability is calculated, see Take Command’s guide to Understanding ICHRA affordability rules.

How the look-back-month safe harbor supports earlier planning. For a calendar-year 2027 ICHRA, applicable large employers may use January 2026 lowest-cost silver premiums to assess employer mandate affordability, subject to the safe harbor’s requirements. The calculation still uses the applicable employee age and location for 2027, the planned allowance and the 2027 affordability percentage of 10.22%. This allows employers to establish contributions before new premiums are available.^9,10

When this safe harbor is properly applied, newly published premiums do not require employers to switch to the 2027 premium benchmark. As part of the review, confirm that the planned allowances meet the affordability standard using the applicable employee information. Document the safe harbors used and apply them consistently as required. These provisions support employer mandate compliance; employee premium tax credit eligibility is assessed separately.⁹

Final rates still provide an important view of the employee experience. Compare actual 2027 premiums with planned allowances to understand what employees may pay and how that varies across locations, ages and employee classes. Even when the employer meets the affordability standard, this review can identify where contribution refinements or additional enrollment guidance would better support the client’s workforce and coverage goals.

Employee net cost

Final rates show how employees’ expected premium contributions compare with the original projections. Even when an ICHRA meets the applicable affordability standard, employees’ actual premium costs depend on the plans they select and the allowance available to them. Where final premiums leave employees paying more than anticipated, help HR prepare clear communications and ensure employees know how to access Take Command’s licensed advisors for help understanding their coverage choices and costs.

Employer budget

An ICHRA gives employers control over their contribution budget. Higher individual premiums do not automatically raise the allowance the employer has committed to provide. Final rates help determine whether that allowance still supports affordability and employee coverage goals, and whether an adjustment is appropriate. Review the maximum allowance budget separately from projected contributions, which depend on enrollment and eligible expenses.

Geographic and age variation

Final rates may affect how far planned allowances go for employees of different ages and in different locations. For clients with employees in several states or metro areas compare updated employee premium costs with the original projections by location and age, taking any differences in allowances into account. This helps identify where the contribution strategy continues to support the workforce and where targeted refinements or additional enrollment guidance may help.

The final-rates due-diligence checklist

Use this checklist to compare final rates with each client’s projected ICHRA strategy and guide next steps for renewal or implementation. Coordinate the review with the client’s enrollment and implementation calendar.

Step 1: Update projections with final rates

Update employee cost projections with final approved premiums for the relevant rating areas. For employer mandate affordability calculations, use the applicable premium benchmark and documented safe-harbor methodology.^8,9
Confirm employee census data is current, including home ZIP codes, ages and dependent coverage status. Include primary work locations when using the location safe harbor.
For plan years beginning in 2027, use the required contribution percentage of 10.22% when assessing affordability.¹⁰

Step 2: Compare updated results with the original projections

Compare original and updated results at the employer, employee class and location level.
Calculate changes in the maximum allowance budget, projected contributions and employee net premium costs
Identify whether differences reflect premiums, census changes, allowance changes or a combination.
Highlight findings that warrant a discussion about planned allowances or employee costs.

Step 3: Identify where employees may need additional support

Compare employees’ projected net premium costs with the original estimates to identify those facing the largest changes.
Identify rating areas where final premiums differ substantially from the assumptions used.
Review results by age and location, taking differences in allowances into account.
Check whether carrier exits or new market entrants change available options, and identify employees who may need help selecting a different plan.

Step 4: Confirm affordability for applicable large employers

Assess affordability for each employee using the applicable premium benchmark and the employer’s documented safe-harbor methodology.^8,9
Identify where planned allowances may need adjustment to meet the affordability standard.
Help the client understand any potential employer mandate implications and evaluate appropriate next steps.
Document the results and safe harbors used. Separately, review final premiums to understand employees’ expected coverage costs.

Step 5: Confirm the strategy still aligns with employer’s goals

Revisit the client’s original objectives, such as cost control, recruiting, retention or ACA compliance
Review whether planned allowances continue to support those objectives at final rates.
Identify whether any contribution adjustments would better support particular employee classes or locations.
Recommend maintaining the strategy or making targeted refinements. Review applicable requirements and implementation timing before changing allowances, employee classes or other plan terms.

Step 6: Prepare leadership and employee communications

Summarize findings for HR and finance leaders, distinguishing the allowance budget, projected contributions and employee premium costs. Include affordability results where applicable and recommended next steps.
Confirm that required notices were provided within applicable deadlines. If the review leads to changes in allowances or other plan terms, determine what amendments, updated notices or employee communications are required before implementation.¹¹
Help HR explain to employees how the allowance applies to coverage and what they can do if their selected plan costs more than expected.
Include clear instructions in employer and employee communications on how to access Take Command’s support team and licensed advisors for enrollment questions and plan selection.

Supporting renewing groups for the next plan year.

Clients with an ICHRA already in place have enrollment and allowance-utilization experience to inform the next plan year. Use those insights alongside final rates to assess how the contribution strategy is working for the employer and its employees.

Use current enrollment to anticipate renewal support needs. Review how final premiums and next year’s planned allowances may affect employees in their current plans. Use those insights to help HR prepare for questions about changing costs and ensure employees know where to get help exploring their coverage options.
Apply lessons from the current plan year. Review employee questions and feedback about choosing coverage, understanding allowances and navigating enrollment. Use recurring themes to help HR anticipate support needs and improve communications for the upcoming renewal.
Compare the employer contributions used toward eligible premiums and expenses with the allowances available to employees. Understand why any amounts went unused, and use those findings to refine spending projections for the upcoming plan year.
Review how workforce changes affect the strategy. Consider whether changes in hiring, locations or employee roles and job status warrant a closer look at the existing class structure and allowances. Review applicable requirements before recommending changes.

Bring these findings back to the client’s original goals. Together, enrollment experience and final rates help you explain what is working, where refinements may help and how the strategy can continue to support the workforce.

Supporting newly committed groups through implementation

For clients preparing for their first ICHRA plan year, final rates provide an opportunity to connect the original projections with implementation plans and employee guidance.

Review the projected outcomes. Compare final rates with the original model to assess how the planned contributions support the client’s budget, affordability and benefit goals.
Align leadership on next steps. Walk HR and leadership through any differences from the original projections and recommend refinements or support where helpful.
Confirm notice timing and implementation documents. Employers generally must provide an ICHRA notice at least 90 calendar days before the plan year begins. Employees who become eligible later, including eligible new hires, generally must receive notice by their eligibility date. That timing also applies to employers established less than 120 days before their first ICHRA plan year. Review any changes against notices already distributed and plan documents already prepared, and confirm required updates or employee communications before implementation.¹¹
Prepare clients for the employee transition. Help HR and leadership anticipate the guidance employees may need when choosing individual coverage and using an ICHRA for the first time. Make sure they know how to access Take Command’s licensed advisors and support team for help comparing plans, checking provider networks and understanding how the allowance applies to premiums.

When additional review or support may help

Your review may identify opportunities to refine the contribution strategy, explore local coverage options or provide additional employee support. The following findings can help guide that conversation with the client:

For an applicable large employer, planned allowances do not meet the affordability standard for one or more employees under the applicable methodology.
Final rates show that some employees would face substantially higher premium contributions than originally modeled, particularly within a specific location, age band or employee class.
A carrier exit leaves employees in a rating area with significantly fewer plan options
The updated projections no longer support the client’s original goals, such as affordability, recruiting or retention in a specific market.

These findings help focus the next steps in the renewal or implementation process. Depending on the client’s situation, that may include a closer review of local plan options, adjustments to the contribution strategy or additional employee guidance. The goal is to identify the support needed to keep the arrangement aligned with the employer’s objectives and help employees navigate their coverage choices with confidence.

Bringing it back to the core question

Does the projected strategy still work? Final rates help benefits consultants answer that question using current coverage costs, the client’s established contribution budget and the applicable affordability methodology. By completing this due diligence and translating the findings into clear recommendations, consultants demonstrate their value as trusted advisors. HR and leadership gain a documented assessment of the strategy and a partner who helps them put the findings into practice.

Key takeaways

Cost pressures affect individual and employer coverage, while final approved rates vary by market. Use national trends as context and evaluate the coverage options available to the client’s workforce.1-3
Update employee cost projections with final rates and current census data. Assess employer mandate affordability using the applicable benchmark, documented safe harbors and, for plan years beginning in 2027, the 10.22% affordability percentage.8
Compare updated results with the original projections by employee class and location to identify where refinements or additional support may help.
Review affordability findings with the client and help applicable large employers evaluate any contribution adjustments needed to support employer mandate compliance.
Document how the strategy supports the employer’s budget and workforce goals, with clear recommendations to guide renewal or implementation.
Use this final-rates due-diligence checklist to guide a documented review and support conversations with every renewing and newly committed client this season.

If you modeled your client’s ICHRA strategy with Take Command, our team is here to help you compare final rates with your original projections and confirm whether the planned contribution strategy continues to support your client’s budget, affordability and workforce goals. If you developed the strategy elsewhere, bring it to us for a closer look. We can help you evaluate the numbers, explore available options and identify opportunities to strengthen the approach for your client and their employees.

References

Peterson-KFF Health System Tracker. “How Much and Why ACA Marketplace Premiums Are Going Up in 2027.” https://www.healthsystemtracker.org/brief/how-much-and-why-aca-marketplace-premiums-are-going-up-in-2027/
Peterson–KFF Health System Tracker. “How Much and Why Premiums Are Going Up for Small Businesses in 2027.” August 6, 2026.https://www.healthsystemtracker.org/brief/how-much-and-why-premiums-are-going-up-for-small-businesses-in-2027/
WTW. “U.S. healthcare costs are projected to climb 11% by 2027. Is your strategy ready for what’s next?” September 18, 2026.https://www.wtwco.com/en-us/insights/2026/09/us-healthcare-costs-are-projected-to-climb-11-percent-by-2027-is-your-strategy-ready-for-whats-next
New York State Department of Financial Services. “Department of Financial Services Announces 2027 Health Insurance Premium Rates, Saving New Yorkers $1.6 Billion.” September 4, 2026. https://www.dfs.ny.gov/reports_and_publications/press_releases/pr20260904
Becker’s Payer Issues. “9 States Finalize 2027 ACA Rates.” https://www.beckerspayer.com/payer/aca/5-states-finalize-2027-aca-rates/
Centers for Medicare & Medicaid Services. “Timing of Submission of Rate Filing Justifications for the 2026 Filing Year for Single Risk Pool Coverage Effective on or after January 1, 2027.” February 23, 2026, pp. 3–4. https://www.cms.gov/files/document/2026-rate-review-timeline-bulletin.pdf
Becker’s Payer Issues. “Medica to Exit ACA Market in 3 States.” https://www.beckerspayer.com/payer/aca/medica-to-exit-aca-market-in-3-states/
Electronic Code of Federal Regulations. 26 CFR 1.36B-2, “Eligibility for premium tax credit,” paragraph (c)(5). https://www.ecfr.gov/current/title-26/chapter-I/subchapter-A/part-1/subject-group-ECFR3a4a3c6b4c3bb5c/section-1.36B-2
Internal Revenue Service. Internal Revenue Manual, §25.21.4.8, “Affordability Safe Harbors”; and Internal Revenue Bulletin 2019-42, REG-136401-18, “Application of the Employer Shared Responsibility Provisions and Certain Nondiscrimination Rules to Health Reimbursement Arrangements and Other Account-Based Group Health Plans Integrated With Individual Health Insurance Coverage.” https://www.irs.gov/irm/part25/irm_25-021-004 & https://www.irs.gov/irb/2019-42_IRB
Internal Revenue Service. Rev. Proc. 2026-26. https://www.irs.gov/pub/irs-drop/rp-26-26.pdf
Electronic Code of Federal Regulations. 29 CFR 2590.702-2, “Integration of Health Reimbursement Arrangements (HRAs) and other account-based group health plans with individual health insurance coverage or Medicare,” paragraph (c)(6). https://www.ecfr.gov/current/title-29/subtitle-B/chapter-XXV/subchapter-L/part-2590/subpart-B/section-2590.702-2