This bill establishes "Custom Health Option and Individual Care Expense Arrangements" (CHOICE arrangements), which are employer-provided health reimbursement arrangements (HRAs) funded solely by employer contributions. These arrangements enable employees to receive payments or reimbursements for medical care, provided they are covered by individual health insurance or Medicare. To qualify, CHOICE arrangements must meet specific nondiscrimination requirements , ensuring employers offer the plan on the same terms to all employees within a designated class, and generally not offer other group health plans to that class. The arrangements also mandate substantiation procedures to verify participants maintain qualifying individual coverage and notice requirements to inform employees of their rights and obligations. The total amount of permitted benefits under a CHOICE arrangement must be reported on an employee's W-2 form. These provisions, along with allowing CHOICE participants to purchase exchange insurance through a cafeteria plan , are effective for plan years and taxable years beginning after December 31, 2025. Furthermore, the bill introduces a new employer tax credit for eligible employers who offer CHOICE arrangements. This credit provides $100 per month per enrolled employee for the first year and $50 per month for the second year, with inflation adjustments. The credit, available to employers not classified as "applicable large employers," is integrated into the general business credit and allowed against the alternative minimum tax.