On-Exchange vs. Off-Exchange Plans: What's the Difference?

When shopping for an individual health plan to pair with your ICHRA, you'll choose between an “on-exchange” plan (purchased through your state's ACA Marketplace, like HealthCare.gov) or an “off-exchange” plan (purchased directly from an insurer or through a private broker).

The key difference: only on-exchange plans make you eligible for a Premium Tax Credit (PTC), a federal subsidy that lowers your monthly premium. Off-exchange plans never qualify for the PTC, no matter your income.

If your ICHRA offer is considered affordable under IRS rules, you're not PTC-eligible anyway — so this distinction may not affect you. If your offer is unaffordable, you'll need to choose: use your ICHRA reimbursement, or waive it and claim the PTC on an on-exchange plan. You can't do both.

Off-exchange plans sometimes offer additional carriers or plan designs not listed on the Marketplace, though pricing for identical plans is usually the same either way.

Bottom line: Check your ICHRA affordability first, then compare on- and off-exchange options in your area before enrolling. Your Gallagher Broker Team can walk you through both options.

Questions? Reach out to Gallagher at (833) 748-5277