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Health Reimbursement Arrangement (HRA)

Health Reimbursement Arrangement

A Health Reimbursement Arrangement, or HRA, is an employer-sponsored and employer-funded health insurance plan that reimburses employees for qualified medical expenses not covered by their employer-sponsored group health plan. 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, funds contributed to an HRA are the property of the employer, and unused contributions cannot be moved when an employee moves to a new employer.

An HRA can be a valuable tool to control spiraling medical plan costs and minimize the impact on employees. A major benefit for businesses is the tax savings employers realize on claims paid. Another advantage is that there is no requirement to set aside funds until a claim is made. Under this employer self-insurance strategy, the employer may elect medical insurance plans with higher deductibles, and redirect the savings they realize to employees' ear-marked accounts. Premium savings realized may be as much as 20%-50%, leaving funds available to help employees pay for these higher deductibles. Another key benefit of HRA accounts is that unused amounts can be rolled over to future years.

Administering an HRA is a full-time job

HRAs involve complex federal regulations, a wide variety of plan choices, decisions about what items to reimburse, crucial employee education and time-intensive reimbursement tracking. Benefit Strategies, LLC will manage all aspects of your HRA plan and guide you through the pros and cons of key decision points necessary to establish your plan.

Our comprehensive HRAs include:

  • Creating your plan documents and summary plan descriptions
  • Administering non-discrimination testing
  • Assisting with employee communications
  • Collecting employees' Evidence of Benefits (EOBs) for eligible expenses
  • Verifying eligibility and reimbursing the employee only when they meet your criteria

Benefit Strategies, LLC has developed direct claim feed relationships with the following carriers specializing in participant and provider pay:

  • Anthem Blue Cross Blue Shield of Maine
  • Anthem Blue Cross Blue Shield of New Hampshire
  • Blue Cross Blue Shield of Massachusetts
  • Blue Cross Blue Shield of Rhode Island
  • Harvard Pilgrim Health Care
  • Neighborhood Health Plan
  • Tufts Health Plan