The Health Reimbursement Arrangement (HRA) is gaining popularity as an effective way for businesses to reduce health care costs. Through numerous meetings with employer groups, MedBen has developed an effective way to determine how employer groups can use the HRA to its best advantage. As a result, we believe our HRA option will provide optimal benefits to both you and your employees.

We're Experienced. MedBen was among the first to administer an HRA, beginning with the release of the IRS guidelines in June of 2004. Since that time, we have worked with employers to establish a variety of HRA plan designs. To apply what we’ve learned along the way, we provide personal consultation to employers considering an HRA and use our unique decision-support checklists to ensure important factors are considered. In this way, we can promote best practices and help you be as successful as possible.

The Choice Is Yours! An HRA is an employer-funded account in which the employer presets the amount of contribution and funds it with non-taxable dollars. This amount can be rolled over from year to year. HRA funds can be used for any substantiated Section 213 medical expense, including deductibles, coinsurance, copays and other cost sharing as defined by the IRS.

The HRA can be used for current employees, retirees, or both. Unlike an FSA, the HRA can allow mid-year enrollments, and reimbursements can cross calendar or plan years.

Employees Also Win! With an HRA, employees gain more control over the allocation of their benefit dollars. HRAs can be set up so employees may use residual benefit dollars from the HRA upon termination or retirement and apply them toward future medical expenses.

A Valuable Assessment. MedBen takes customary HRA administrative services and goes one step further. To help ensure the HRA will generate the savings desired, we offer an extensive HRA Value Assessment. This initial evaluation provides an employer with estimated plan year savings based on various benefit design options. Once complete, the employer is equipped with the information necessary to make the best benefit decision – one that delivers the anticipated return on investment.

Whether you decide to offer an HRA in tandem with a medical plan or all alone, plan design changes are probably warranted. You may need to shift a benefit from the basic health plan into the HRA, move benefit dollars from the health plan to the HRA through higher deductibles, or add a Flexible Spending Account (FSA) to your plan. (See our FSA section for more details!) Whatever you decide, MedBen can work with you on the best redesign for your individual situation.

Keeping It Simple. To keep HRA administration simple, MedBen provides on-line account tracking. In seconds, you can review current account activities, including balances and the status of claims. And, if an employer is linking the HRA to an FSA account, the on-line service provides account information for both.

Want to Learn More? MedBen continually hosts employer seminars on consumer-driven health plans (CDHPs) throughout the Midwest. Over the past few years, these free half-day programs have been delivered to hundreds of employers exploring the cost-saving advantages of CDHPs. Our programs are offered through MedBen University, our professional education division and feature speakers with 15 or more years of benefits experience and specific expertise in their respective topic. For more information on these popular seminars, contact marketing@medben.com.

For more information about HRAs, e-mail our marketing department at marketing@medben.com.