What Is a Health Reimbursement Arrangement (HRA)?

A Health Reimbursement Arrangement (HRA) is an employer-funded benefit that reimburses employees for qualified medical expenses and, in some cases, insurance premiums. Unlike an HSA or FSA, the money comes entirely from your employer — you never contribute your own paycheck dollars.

How an HRA Works

Your employer sets aside a specific dollar amount each year and decides what expenses qualify. You pay for care out of pocket (or use a card tied to the account), submit a claim, and get reimbursed up to your allowance. Unused funds may or may not roll over, depending on your employer's plan design.

HRA vs. HSA vs. FSA

• HRA: 100% employer-funded, employer controls the rules, no portability — you lose it when you leave the job
• HSA: funded by you (and optionally your employer), fully portable, requires a high-deductible health plan, triple tax advantage
• FSA: mostly employee-funded via payroll deduction, use-it-or-lose-it, tied to your current employer

Common Types of HRAs

• Qualified Small Employer HRA (QSEHRA): lets small businesses (under 50 employees) reimburse employees for individual health insurance premiums and medical costs
• Individual Coverage HRA (ICHRA): available to employers of any size, reimburses premiums for individual market health plans
• Excepted Benefit HRA: a smaller add-on account alongside a traditional group health plan