What is an HRA?

An HRA can be used in conjunction with a high-deductible health plan to curb premium costs or with a Flexible Spending Account (FSA) to help cover out-of-pocket expenses.

Health Reimbursement Arrangements (HRAs) are employer-designed and employer-funded plans that reimburse employees for out-of-pocket medical expenses not covered by a health insurance plan. HRAs are a major part of the growing trend toward greater consumer health care responsibility. An HRA can be used in conjunction with a high-deductible health plan to curb premium costs or with a Flexible Spending Account (FSA) to help cover out-of-pocket expenses. If the HRA is used to cover medical expenses, it must follow applicable rules requiring integration with a medical plan.