What is a Health Reimbursement Arrangement (HRA)?
An HRA is an employer-funded account that reimburses employees for qualified medical expenses and sometimes insurance premiums—offering flexibility and tax savings for both employers and employees.
Key Features:
Employer-Funded
Tax-Free Reimbursements
Flexible Plan Design
Pays for Premiums & Expenses
No Employee Contributions
Unused Funds May Roll Over
FAQ
Who can set up an HRA?
Only employers can establish and fund an HRA—employees cannot contribute their own money to the account.
What expenses are reimbursed?
Qualified expenses can include deductibles, copays, prescriptions, and sometimes health insurance premiums—check your plan documents for specifics.
Do HRA funds roll over year to year?
Employers may allow unused funds to roll over, but it’s not required. Each plan has its own rules regarding carryover.
Is an HRA taxable?
No, reimbursements for qualified medical expenses are generally tax-free for both employer and employee.