An employee medical reimbursement plan may cost savings to the employer and an increased choice and savings to employees. But with the sea of acronyms and terms it can be difficult to understand the different types of reimbursement plans.
This article gives an overview of four common types of employee medical reimbursement plans including health savings accounts (HSAs), health reimbursement (HRAs), health reimbursement plans (HRPs) and Health Flexible Spending Accounts (FSAs ).
health savings account (HSA)
HSAs are individual bank accounts of employees in the ownership, enables tax-free medical reimbursement. While HSAs are often offered as "employer benefits", they are more like IRAs really because people in and helping them adjust to their own. Since HSAs are owned by the employee, the account with the employees remain, even if they change jobs, retire, or to leave employment. An employer usually provides an HSA qualified high deductible health plan and an HSA.
Health Reimbursement Arrangement (HRA)
An HRA is an employer-funded, tax advantaged benefit employer health plan that employees be reimbursed out of pocket medical expenses. An HRA can make contributions to an employee's "account" and provide reimbursement for eligible expenditure by employers. HRAs are used in one of two ways. Either the employer provides an integrated HRA, coupled with a high deductible health insurance. Or has the employer used a stand-alone HRA to reimburse individual health insurance premiums. However, the health care reform restrictions on the use of stand-alone HRAs has provided for most employers. If an employer wants to be reimbursed for individual health insurance premiums, they often set up a limited purpose Healthcare reimbursement plan discussed next.
Healthcare Reimbursement Plan (HRP)
A HRP is a type of medical reimbursement plan designed for premium refund. An HRP is funded by the employer and heard. Employees can use their allowance to health insurance to reimburse for qualified individual and family premiums. HRPs are often the basis of a premium refund program or "pure" benefits can be post is shaping health with the health reform adhere new market reforms.
Flexible Spending Account (FSA)
Health FSAs offer a tax-free way for employees to save for qualified medical expenses during a year. FSAs can be paired with any health plan or used alone. Fund expire if not used by the plan at the end.
FAQ: How does health reform impact employees Medical Reimbursement Plans
The Affordable Care Act (known as ACA, Care or Health Reform) was signed in 2010 in a law and impacts many areas health care and health insurance, including employee medical reimbursement plans. For example, o ver-the-counter (OTC) drugs are no longer eligible for tax-free reimbursement unless with a medical prescription health FSA is restricted load limit at $ 2,500 per year, and many of the employer-funded medical reimbursement plans are now subject to the new market reforms of the ACA.
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