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Glossary
A health reimbursement arrangement (HRA) is an account with pre-tax contributions from an employer that employees can use to pay for medical expenses.
A health reimbursement arrangement (HRA) is a fund set up by an employer. The employer puts aside a certain amount of pre-tax money each year for employees to use on medical expenses like deductibles (opens in new tab), copays (opens in new tab), or coinsurance (opens in new tab) that aren’t covered by a health insurance plan.
Word to the wise: Only an employer can put money into a HRA – employees can’t contribute directly, as they would with a FSA (opens in new tab) or HSA (opens in new tab). Additionally, these contributions lapse at the end of each calendar year, so it’s important to put the right amount of money in.
Some small businesses have the option to provide pre-tax money to employees through a qualified small employer health reimbursement arrangement (QSEHRA). You can learn more about QSEHRA eligibility from your insurance broker.