Captain Contributor

HRA Overview


Your employer offers a Health Reimbursement Arrangement (HRA), and you need to find out what that means for you.

A Health Reimbursement Arrangement is an employer-sponsored benefit plan funded solely by the employer that allows employees to receive reimbursement for qualified expenses.

Plan Specifications

HRAs are owned and funded by the employer. Therefore, the employer works with a benefits administrator to set up plan design, which may vary from company to company. Employers must provide a Summary Plan Document (SPD) that outlines the plan details. There is NO healthcare plan requirement for an HRA, and if you leave the employer for any reason, the funds in your HRA are no longer available to you.

Contribution Limits

Each employer decides how much to contribute to their employees’ HRAs; therefore, funding may vary. It’s important to remember that funding cannot be deducted from the employee’s paycheck. Each employee should receive the same benefit amount, though the plan may allow a difference for single workers versus those with families.

Need to Know!

  • Qualified expenses vary by employer and can include prescriptions, dental and vision expenses, copays, deductibles, and more. Refer to your Summary Plan Document (SPD).
  • Unused funds in an HRA may rollover each year, depending on plan design
  • Employers enjoy payroll tax benefits from contributions, while employees pay no taxes when the HRA is used for eligible expenses
  • An HRA is considered a notional account, in that the employee must incur a qualified medical expense before any funds are reimbursed

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