Perfect Plan Solutions
Perfect Plan Solutions
HRAs
HRAs
Health Reimbursement Arrangements
Health Reimbursement Arrangements
Understanding The HRA Option
Understanding The HRA Option
Certain small employers—generally those with less than 50 employees that don’t offer a group health plan—can contribute to their employees’ health care costs through a Health Reimbursement Arrangement (HRA).
An HRA allows small employers to provide non-taxed reimbursement of certain health care expenses, like coinsurance, prescription costs, deductibles, etc. For some HRAs, the funds can be used to pay monthly premiums for a health plan purchased by the employee (reimbursements may or may not cover the employees' entire premium costs).
How HRAs Work
How HRAs Work
- With an HRA, small employers can decide what they'll contribute to their employees’ HRA accounts, up to the annual maximum.
- HRA funds can only be used towards an employee's medical expenses.
- Employees pay their medical provider or insurance company for their health care costs, then submit proof of payment to be reimbursed by the HRA account. Reimbursement is tax-free.
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