A Health Reimbursement Arrangement (HRA) is a funding mechanism where the employer uses an amount of money to help fund employee medical expenses.  HRAs can be funded or unfunded, and the features and types of expenses covered by the arrangement can vary greatly based on the employer’s goals.

HRAs may allow an employer to lower their overall healthcare expense without lowering the benefits enjoyed by their employees.  A case specific analysis must be performed to determine the feasibility and risk/reward profile of this approach.

HRAs can act as a pathway to consumerism by introducing employees to the true cost of healthcare without increasing their actual costs.  HRAs can also act as a first step towards self insurance.

Progressive Benefit Solutions is very experienced with HRAs and we have used many types of approaches successfully with our clients.  We also recognize the importance of utilizing an experienced third party to administer the HRA and have identified the appropriate vendors to help our clients.