As health care costs increase, more of the cost burden is being shared with consumers. A Clarity Health Reimbursement Arrangements Plan (HRAs) is an easy way of helping employers control health insurance costs while helping consumers pay for additional medical expenses.
What It Is
A Health Reimbursement Arrangement is an employer-paid health reimbursement plan. Any employer can decide to offer it to their employees. It helps employees save money by paying for different types of out-of-pocket expenses (deductibles, copays, etc.). Employers save money by shifting to consumer-driven healthcare. They pay directly for various expenses instead of through increased premiums from an insurance company. HRA Plan funds used by employees are tax deductible to the employer and employee.
HRA Plan Administration: How It Works
HRA’s are funded solely by the employer. They set aside a given amount of pre-tax dollars in an account to pay for expenses not reimbursed by the employer’s health insurance. Employees get help with their day-to-day expenses, and Employers set the rules for how and when they can use those funds.