| A Health Reimbursement Account (HRA) is an employee benefit plan designed to help offset unreimbursed medical expenses incurred by the employee (and dependents). The employer provides the funds to reimburse the employee by contributing funds to an HRA. After the expenses are incurred, the employee can submit a claim for reimbursement.
HRAs can vary greatly in design, but are developed basically for the same purpose—to reimburse the employee for expenses not covered by any other health plan. For example, one HRA can be designed to cover all or a portion of the deductible on a High Deductible Health Plan (HDHP), while another is designed to reimburse the employee for dental and vision expenses. It just depends on the employer's goals for providing employee benefits.
An HRA can be "linked" or "unlinked." A linked HRA is tied to an health plan; you have to participate in the health plan to be eligible for the HRA. An unlinked (or stand-alone) HRA is set up to pay certain expenses, such as dental or vision expenses, without any connection to an insurance policy.
It just depends on your goals in providing employee benefits.
TWO GOALS for an EMPLOYER
1. SAVE MONEY!!
2. MAINTAIN THE LEVEL OF BENEFITS FOR THEIR EMPLOYEES!!
With an HRA, both the Employer and Employee Benefit!! |
