A Benefit Strategies Health Reimbursement Arrangement, or HRA, is an employer-sponsored and employer-funded plan. It reimburses employees for qualified medical expenses such as deductibles and co-insurance incurred under the employer’s medical plan that are not covered by their employer-sponsored group health plan.
The employer must offer group medical coverage to offer any HRA. Only HRAs providing coverage for dental or retiree coverage can be offered without offering group insurances.
An HRA can be a valuable tool to control spiraling medical plan costs while minimizing the impact on employees. These arrangements are preferred by many employers, who can limit their own cost of health care by establishing a limit on the contributions they will make for employees.