Health Reimbursement Account (HRA)
What is a Health Reimbursement Account (HRA)?
How Does a Health Reimbursement Account (HRA) Work?
A company establishes an HRA as a separate discretionary account that it funds on a periodic basis. These contributions are tax deductible for the firm, and the balance of the account may be used toward reimbursing employees for health expenses that the company's healthcare provider does not cover.
For example, if a company employee must pay for a massage therapy treatment that is not covered but has been specifically prescribed by an orthopedic surgeon, the company may reimburse that employee for the cost of the massage using an HRA.
Why Does a Health Reimbursement Account (HRA) Matter?
An HRA is a discretionary account unrelated to a company's healthcare plan. Companies are under no obligation to maintain an HRA as part of their employee benefits and are free to cut such a provision without notice. It is important that employees are aware of this, though companies are generally less likely to forego HRAs in an environment of rising healthcare costs.
Personalized Financial Plans for an Uncertain Market
In today’s uncertain market, investors are looking for answers to help them grow and protect their savings. So we partnered with Vanguard Advisers -- one of the most trusted names in finance -- to offer you a financial plan built to withstand a variety of market and economic conditions. A Vanguard advisor will craft your customized plan and then manage your savings, giving you more confidence to help you meet your goals. Click here to get started.