HRA

Health Reimbursement Arrangement

HEALTHCARE

Employer-funded plan

An HRA is the right choice for employers who want to provide maximum employee healthcare benefits in conjunction with a high-deductible health plan (HDHP). Employers allocate a set dollar amount for employee medical expenses, and employees pay for healthcare expenses with tax-free, employer-provided funds.

TASC offers multiple HRA Plans that you can choose from to create a tax-free benefit that works for your organization. Our standard HRA Plan offers three plan design options to fit types of expenses covered. Plus, our unique funding arrangement allows claim payment to employees before full plan funding has been received. Our standard HRA Plan offers:

Customized plan options for businesses of any size and type.
Industry-leading, fast, and accurate reimbursements.
Individual participant accounts; fixed annual amount funded by employer.

Health Reimbursement Arrangement (HRA)

Employer reimburses participant for qualified medical, dental, and vision expenses. Expenses are determined by the employer, typically medical deductible/coinsurance.

Participant Benefits

TAX ADVANTAGED

Employer Benefits

Integrated Funded HRA (IFHRA)

Available to employees who choose the group health insurance plan, this account supplements their coverage by helping with out-of-pocket healthcare costs. The covered expenses, typically including medical deductibles and coinsurance, are determined by the employer.

TAX ADVANTAGED

Participant Benefits

Employer Benefits

Individual Coverage HRA (ICHRA)

Allows employee to enroll in an individual health plan. Allows employer to offer a Healthcare FSA. Employer determines expenses, which can include health insurance premiums along with out-of-pocket medical, dental, and vision expenses.

Participant Benefits

Employer Benefits

TAX ADVANTAGED

Retiree Funded HRA

Enables retired employees to use funds to pay for premiums and expenses during retirement. Expenses are determined by the employer and typically cover out-of-pocket medical, dental, and vision expenses.

Participant Benefits

TAX ADVANTAGED

Employer Benefits

Wellness Reimbursement Arrangement

Employer reimburses participants for qualified wellness-related expenses. The specific expenses, determined by the employer, may include health risk assessments, gym or health club memberships, and programs for weight loss or smoking cessation.

Participant Benefits

TAX ADVANTAGED

Employer Benefits

Emergency Expense HRA

Employer reimburses participant for medical expenses as a result of a public healthcare crisis. Expenses include: out of pocket medical, dental and vision expenses.

Participant Benefits

TAX ADVANTAGED

Employer Benefits

Qualified Small Employer HRA (QSEHRA)

Enables small employers (with fewer than 50 full-time or full-time equivalent employees) to reimburse their employees for eligible medical expenses. These expenses, typically defined by the employer, often include out-of-pocket costs for medical, dental, and vision care, as well as insurance premiums.

Participant Benefits

TAX ADVANTAGED

Employer Benefits

Excepted Benefit HRA

Employers of any size can reimburse employees for medical, dental, and vision out-of-pocket costs, as well as premiums for dental, vision, and COBRA, even if they aren’t enrolled in the Group Health Plan (GHP).

Participant Benefits

TAX ADVANTAGED

Employer Benefits

Medicare HRA

Employer reimburses participant for Medicare Part B or D premiums for excepted benefits. * Expenses are Medicare supplemental premiums.

Participant Benefits

TAX ADVANTAGED

Employer Benefits

* not included in a traditional health insurance plan.

Spousal Incentive HRA

Employer incentivizes the participant to enroll in their spouse’s group health plan. Expenses, defined by the employer, usually include out-of-pocket costs for medical, dental, and vision care.

Participant Benefits

TAX ADVANTAGED

Employer Benefits

Healthcare Premium (NESP) Account

Allows employees to contribute funds into an account that pays health insurance premiums. Eligible expenses typically include premiums for health, dental, and vision insurance.

Participant Benefits

TAX ADVANTAGED

Employer Benefits

Why TASC HRA benefits?

HRA toolbox
customize to win

Offering HRAs is like having your own financial toolbox. You have the flexibility to customize health benefits to different needs while controlling costs.

When you can customize, employees have more control over their healthcare costs which improves financial well-being and loyalty, which can translate into a stronger bottom line.

Flexible Design

TASC offers a multitude of plan design options including first dollar, second dollar and percentage.

Carrier Agnostic

Thinking of changing a carrier at renewal? Having TASC as an independent HRA partner enables you to do so seamlessly without an impact to the employee.

Customize & Control

Employers set a fixed contribution amount, leading to predictable budgeting and managing costs and our extensive HRA options allow you to design them for specific employee groups or needs.

Health Reimbursement Arrangement

Tax advantaged benefit account

A Health Reimbursement Arrangement (HRA) is a tax-advantaged benefit that allows both employees and employers to save on the cost of healthcare.

HRA plans are employer-funded medical reimbursement plans. The employer sets aside a specific amount of pre-tax dollars for employees to pay for health care expenses on an annual basis. Based on the plan design, HRAs can generate significant savings in overall health benefits.

The primary requirements for an HRA are that (1) the plan must be funded solely by the employer and cannot be funded by salary reduction, and (2) the plan may provide benefits for substantiated medical expenses only.

HRAs may be designed in many fashions to suit the specific needs of employer and employees alike. It is one of the most flexible types of employee benefits plans, making it very attractive to most employers.

Benefits to the Employer

Most importantly, all employer contributions to the plan are 100% tax deductible to the employer, and tax-free to the employee.

Studies show that only 20-50% of employees actually use their healthcare coverage, meaning employers often pay health insurance premiums for employees who are not utilizing the coverage. An HRA allows employers to determine the best type of coverage for their employees based on the demographics of their employee group.

HRA plans may also cover retired employees (and their spouses and tax dependents). Employers may wish to consider an HRA as an alternative to more expensive traditional retiree healthcare.

Employee benefits, like an HRA, enable employers to recruit and retain quality employees. With an HRA in place, the employer is perceived in a positive light by current and prospective employees because a benefits package is being provided with the employee’s interest in mind.

Benefits to the Employee

Depending on the plan design, expenses that may be reimbursed from the HRA include the following: deductibles, co-payments, co-insurance, prescription medications, vision expenses, dental expenses, and other out-of-pocket health-related expenses.

HRA funds are contributed to employees on a pre-tax basis; therefore, the funds are not taxable to the employee. As such, employees need not claim an income tax deduction for an expense that has been reimbursed under the HRA.

Plan designs

HRAs are very flexible, allowing the employer to design their plan to meet the unique needs of the company and the employees. Common plan designs include the following:

Deductible, Co-pay, and Co-insurance

All medical expenses that are applicable to the health plan’s deductible, a co-pay amount, or a co-insurance amount qualify for reimbursement. Qualified expenses are those incurred by the employee or the employee’s family. An Explanation of Benefits (EOB) statement (provided by the employee’s health insurance provider) showing evidence that the expense is applicable to the insurance deductible, is typically required for substantiation of requests for reimbursement.

Deductible

All medical expenses that are applicable to the health plan’s deductible qualify for reimbursement. This plan design does not include co-pays or co-insurance amounts. Qualified expenses are those incurred by the employee or the employee’s family. An EOB statement is also typically required for substantiation of requests for reimbursement.

All Uninsured Medical Expenses

All out-of-pocket medical expenses not covered by insurance (uninsured) are eligible, such as deductibles, co-pays, co-insurance, dental, vision, prescriptions, and other out-of-pocket medical costs. These expenses may be incurred by the employee or their family. Typically, an EOB statement, or a copy of receipt or bill showing the date, amount, and provider’s name are required to substantiate reimbursement requests.

Specific Expenses Only

Plans may be designed to cover dental expenses only, orthodontia expenses only, vision expenses only, prescription medical expenses only, and/or other specified expenses. A copy of a receipt or copy of a bill identifying the date of service, amount of service, and the name of the service provider are typically used to substantiate requests for reimbursement.

Frequently Asked Questions

What is a Health Reimbursement Arrangement (HRA) and how does it compare to an FSA or HSA?

A Health Reimbursement Arrangement (HRA) is an employer-funded benefit that reimburses employees for qualified medical expenses. Unlike FSAs or HSAs, HRAs are funded solely by the employer and do not involve employee contributions. Employers determine the amount of money available in the HRA, and employees submit eligible expenses for reimbursement. Unused funds may or may not roll over from year to year, depending on the employer’s plan design. HRAs can be used to cover a wide range of medical expenses, including deductibles, co-payments, and certain out-of-pocket costs not covered by insurance.

What types of HRAs are available and which one suits our workforce best?

Employers need to understand the different types of HRAs, such as the Qualified Small Employer HRA (QSEHRA), Individual Coverage HRA (ICHRA), and Excepted Benefit HRA (EBHRA), and determine which type aligns best with their business size, budget, and employee needs.

Will unused HRA funds roll over from year to year?

Employers must decide whether unused HRA funds will roll over to the next year or be forfeited at the end of the plan year.