A Health Reimbursement Arrangement (HRA) is a type of account that employers can use to reimburse employees for their medical expenses. HRAs are tax-advantaged, meaning that employees can save money on their taxes by participating in an HRA.

How do HRAs work?

Employers contribute money to an HRA on behalf of their employees. Employees can then use the money in their HRA to reimburse themselves for qualified medical expenses, such as copays, deductibles, coinsurance, and prescription drugs.

Types of HRAs

There are two main types of HRAs:

• Integrated HRAs: Integrated HRAs are linked to a group health insurance plan. Employees must be enrolled in the group health insurance plan in order to participate in an integrated HRA.

• Stand-alone HRAs: Stand-alone HRAs are not linked to a group health insurance plan. Employees can participate in a stand-alone HRA even if they are not enrolled in a group health insurance plan.

Benefits of HRAs for Employers

There are a number of benefits for employers to offer HRAs to their employees, including:

• Reduced healthcare costs: HRAs can help employers to reduce their healthcare costs by shifting some of the cost of healthcare to employees.

• Attracted and retained top talent: Employees value HRAs as part of their compensation package.

• Improved employee morale: Employees who have access to HRAs are more likely to be satisfied with their job and more likely to be productive.

Benefits of HRAs for Employees

There are also a number of benefits for employees to participate in HRAs, including:

• Tax savings: Employees can save money on their taxes by participating in an HRA.

• Flexibility: Employees can use the money in their HRA to reimburse themselves for a wide range of qualified medical expenses.

• Portability: If an employee leaves their job, they can typically keep the money in their HRA.

How to Choose the Right HRA

When choosing an HRA, it is important to consider the following factors:

• The needs of your employees: Consider the age, health, and lifestyle of your employees when choosing an HRA. For example, if you have a young workforce with healthy employees, you may want to choose an HRA with a lower contribution limit.

• Your budget: The cost of an HRA will vary depending on the size of your workforce and the benefits that you choose to offer. It is important to set a budget before you start shopping for an HRA.

• Your carriers: Compare different HRAs from different carriers to find the plan that is right for you and your employees.

Deerfield Advisors Can Help You Choose the Right HRA

Deerfield Advisors is an independent insurance agency that can help you to choose the right HRA for you and your employees. We offer a variety of HRAs from different carriers. We can also help you to compare different HRAs and choose the plan that is right for your needs and budget.

Contact Deerfield Advisors Today for a Free HRA Quote

If you are an employer in Houston, TX, and you are interested in offering an HRA to your employees, contact Deerfield Advisors today. We can help you to choose the right plan for you and your employees, and we can walk you through the entire enrollment process.