The Health Reimbursement Account (HRA)

The Health Reimbursement Account or HRA is a program in which the employer places money for the employee to use on routine medical care, including prescriptions. The plan also typically includes a Traditional Health Coverage (PPO) component, similar to a typical health plan, which protects employees from large expenses.

How the HRA plan works:

First, pay for routine care from the HRA. Employees use available dollars in their account to pay 100% of the cost for routine medical care, like office visits, tests and prescriptions. They can make the most of their dollars by visiting providers who participate in their health insurance plans network.

Use the plans Traditional Health Coverage when it is needed. The Traditional Health Coverage part of the plan pays a percentage of covered expenses after the employee satisfies a specified out-of-pocket expense. The employee will receive the highest level of coverage if they use doctors and hospitals that are in the health plans network. If they reach the plans annual out - of - pocket limit, all remaining covered expenses for the year are fully covered.

Advantages of the HRA Plan:

The employer gives the employee health care dollars to spend their way. The dollars that go into the HRA come from the employer, and the employee controls how they are spent.

Save dollars that arent used this year and use them to help reduce any out of -pocket expenses that might occur in future years.

Learn about:
The Health Savings Account (HSA)
The Flexible Spending Account (FSA)
The Section 125 Plan