Health Reimbursement Account (HRA)*

One way the government has responded to rising healthcare costs is by creating tax-free Health Reimbursement Accounts, or Arrangements. These allow employers to reimburse employees for eligible medical expenses not covered by the company's health insurance policy.

As with a Flexible Spending Account (FSA), an HRA can lower employer and employee taxes. Unlike an FSA however, HRA funds may be rolled over to the next plan year if the employer chooses.

Compare Healthcare Accounts

For a direct comparison between an HRA, FSA, and a Health Savings Account (HSA), see the chart below, or call a licensed Paychex Insurance Agency Representative at 877-393-8868.

Direct Comparison Between an HRA, FSA, and HSA
  HRA FSA HSA
Can be funded by anyone

Employer funded only

Can be funded by employer or employee

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Can be used with any type of health plan

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A qualifying high-deductible health planEnrollment in a Qualified High-Deductible Health Plan is required in order to make deposits into a Health Savings Account (HSA). For a high-deductible health insurance policy to qualify, the deductible and annual out-of-pocket expenses must meet specific IRS guidelines.

For more about high-deductable health plans, speak with a licensed Paychex Insurance Agency Representative at 877-393-8868. is required in order to contribute to an HSA.
Qualified expenses

Employers may configure account to reimburse all or some un-reimbursed expenses as defined under section 213(d) of the Internal Revenue Code. Exceptions apply.

For general information about qualified expenses, call us at 877-393-8868.

Medical, dental and dependent care expenses: including co-payments, deductibles, and some over-the-counter medications.

For general information about qualified expenses, call us at 877-393-8868.

Any otherwise un-reimbursed expenses are qualified as defined under section 213(d) of the Internal Revenue Code. Exceptions apply.

For general information about qualified expenses, call us at 877-393-8868.
Unused amount carries over to the following year

Employer may configure the HRA to allow unused funds to be carried over.

Does not carry over, but employer can add a 2.5 month grace period to the end of the plan year.

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Account is portable between employers    

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Tax savings tool

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Employer contributions are tax free. There are no employee contributions.

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Employer and employee contributions are tax free.

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Employer and employee salary reductions are tax free in conjunction with a section 125 plan. If contributions are made outside of a section 125 plan, the individual generally can take a deduction on their personal taxes at the end of the year.
Can have unlimited contribution amounts

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Any restrictions are determined by the employer.

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Any restrictions are determined by the employer. Dependent Care Assistance Expenses are restricted by IRS Guidelines

Contributions are restricted by IRS guidelines2010
$3,050 for single coverage
$6,150 for family coverage.
Catch-up contributions allowed for older workers    

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Can be integrated with other accounts

An HRA can be integrated with an FSA, and within certain limitations, an HSA.

Call us at 877-393-8868 for details.

A healthcare FSA can be integrated with an HRA, and within certain limitations, an HSA.

Call us at 877-393-8868 for details.

An HSA can be integrated with an HRA or FSA within certain limitations.

Call us at 877-393-8868 for details.
 

* Offered through Zane Benefits, Inc.

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