An HRA is a more accessible alternative or supplement to group health insurance. Employers can set a monthly allowance that best fits their budget. Employees then request reimbursement for any qualified medical expenses they choose. Key features: ...
An HRA or a Health Reimbursement Arrangement is a group health plan funded by the employer that reimburses employees for their qualified medical expenses. These reimbursements are tax-free and typically have a fixed dollar amount per year. There are some types of HRA plans that can also reimburs...
Supporting Your Employees A Health Reimbursement Arrangement (HRA) compliments your group health plan, allowing you to design employer-paid reimbursement strategies to offset the rising costs of qualified medical expenses of your employees.HRA Advantages There are no annual contribution limits on HRAs. ...
With an HRA, employers contribute money for each employee to pay for eligible out-of-pocket medical costs. Employers can choose whether to allow the funds to be used for all qualified medical expenses approved by the IRS or a subset of eligible qualified expenses. When employees incur eligible...
Qualified medical expenses are defined by the IRS and may change at any time. You can reference IRS Publication 502 and IRS Publication 503 for the full list of expenses that are qualified, are not qualified, and may be qualified based on certain circumstances. Your employer may determine ...
Withdrawals for qualified medical expenses are tax-free, and accumulated interest is tax-deferred. Individuals or employers can open an HSA. Regardless of who opens it, the individual owns it—even if they leave your company. HRA disadvantages HSA disadvantages The federal government considers some...
An HRA allows employers to fund an account to pay employees’ medical expenses that are not covered by insurance such as deductibles, copays or coinsurance. An HRA can be offered alongside a Flexible Spending Account (FSA) to help employees offset qualified medical expenses. Additionally, ...
Qualified Small Employer HRA Available for employers NOT subject to the Employer Mandate and who DO NOT offer a group health plan Primarily used to reimburse individual health insurance premiums Can also include all 213(d) eligible medical expenses that include: ...
A health reimbursement arrangement (HRA) is an employer-funded plan that reimburses employees for qualified medical expenses and, in some cases, insurance premiums. Employers are allowed to claim a tax deduction for the reimbursements they make through these plans, and reimbursement dollars received ...
Amounts contributed to an employee's HRA are not covered in the employees' income and funds can be drawn back from the account on a pretax basis to pay for qualified medical expenses. Whereupon, COBRA premiums paid on a pretax basis from an HRA are considered as paid by the employer, ...