The Revenue Act of 1978 brought about significant change in the way employers assisted their employees with financial management, more importantly financial freedom, by a little-known provision at the time called 401k. In 1980, the 401k provision went into effect. However, it took almost a decade before employers moved almost entirely away from defined benefit pension plans to an approach to get their employees engaged in their retirement planning. Now, forty years later, most Americans are participating in a 401k type of retirement savings plan.  

We believe that ICHRA is the watershed regulatory change that will create the next forty year run in getting employees engaged in the financial management of their healthcare and their healthcare journey. Why do we believe this is going to become the 401k moment for healthcare? Just like the days before 401k, employees were not engaged in their financial management. Employers that offered a retirement plan offered a defined benefit pension plan. The employee received a percentage of their final three to five years of their compensation no matter how the financial markets were performing. Similar to traditional employee benefit plans today, the employees had no real say in the management nor the ability to really enhance their benefits without doing something outside of the employer program. ICHRA changes all of that, in the way 401k changed the way both the employer and employees manage individual retirement planning.