Health Reimbursement Arrangements (HRA)
Health reimbursement arrangements (HRAs), also called health reimbursement accounts, are accounts funded and owned by employers, which are used to reimburse employees for health expenses not covered by employer-sponsored plans. Unlike health savings accounts (HSA), they are paid into by the employer.
Employees are reimbursed (up to a fixed annual amount) after medical expenses are incurred, and reimbursements are tax free for employees who pay for qualified medical expenses. HRAs can also be used to cover medical expenses for spouses and dependents and may be offered alongside other employer-provided health benefits.
HRAs may either pay out until funds are gone, after which point the employee pays any remaining expenses, or they pay out once employees have already paid a certain amount for medical bills not covered by their plan.
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