Overview: A Health Reimbursement Account or Arrangement (HRA) is an employer funded benefit plan used to reimburse employees for approved medical expenses, typically on a pay-as-you-go basis. The employer contributes on behalf of all eligible employees. No employee contributions are allowed.
HRAs have advantages for both the employer and the employee. Advantages for the employer include:
Some advantages for employees include:
Unlike health savings accounts (HSAs), an HRA is owned and operated by the employer. As a result, it is the employer's responsibility to ensure that the HRA is used only for qualified medical services.
Tracy Morley, SPHR, Legal Editor
Employment glossary definition of HRA (Health Reimbursement Arrangement).
HR guidance on the benefits of Health Reimbursement Accounts (HRAs) for employees and employers.