The Issue: Can an employer offer employees a health reimbursement account (HRA) under the Affordable Care Act?
The Solution: Maybe. As a general rule, employers may only offer an HRA if it is integrated with a group health plan (not individual insurance).
Analysis: HRAs are employer-funded accounts designed to reimburse employees for out-of-pocket medical expenses. Employees are not permitted to contribute their own funds, so they are unlike flexible spending accounts or health savings accounts, in which an employee defers a portion of his or her wages into the plan to be used to reimburse co-pays or the employee’s portion of insurance premiums. Because they are employer-funded, HRAs are considered to be group health plans.
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Contact Steven G. Cosby, MHSA with questions or to request more information and to schedule a healthcare plan evaluation, savings analysis or group plan solution for your company.
