Heritage Options HRA
Not available for insured employers in Illinois or Virginia.
With Heritage Options HRA, members have a consumer-driven plan that includes a deductible and a Health Reimbursement Account (HRA) to help meet that deductible. That means members have a pool of money every year that can be used to pay for covered medical expenses up to a set amount.
Members can decide how much to use from the employer-funded HRA, and depending upon their specific plan, members may be able to roll-over the unspent portion until the following year.*
What is a Health Reimbursement Account (HRA)?
An HRA is a tax-advantaged account an employer establishes to reimburse employees for covered medical expenses up to a certain amount each year. HRAs are funded solely by the employer and the funds are not taxable.
What are the advantages of the Heritage Options HRA for employers?
- No pre-funding – No need to pre-fund the reimbursement accounts. Money is withdrawn from each employee’s HRA only as expenses are incurred.
- Choose who pays first – Determine who pays for medical expenses first under the deductible – the employer or the member through the HRA.
- Choose the amounts – Choose the maximum amount to be reimbursed and the amount that can be rolled over each year in the HRA.**
- Choose portability of funds – Employers can choose to retain ownership of any unused HRA balance when an employee leaves the job because the funds are not required by law to be portable.
- Choose a cap over time – Choose whether to place a cap on the amount that can be accumulated in the HRA over time, and if so, the amount of that cap.**
- Enjoy tax benefits – The HRA funds are not taxable and can be excluded from an employee’s gross income.
- Encourage wise health care choices – Help encourage employees to spend their health care dollars more wisely. By having more financial responsibility and awareness of medical costs, plan members may be more prudent in their spending choices, and this may help control premiums.
What are the advantages of the Heritage Options HRA for employees?
- Employer funded – The HRA is entirely funded by the employer with pre-tax dollars.
- Unused funds may carry over – Any HRA funds not used in a given year may be rolled over to the next year.* That amount is added to the HRA funding in subsequent years.
- Reimbursement for expenses – Plan members will be reimbursed for a wide range of medical expenses, which are those covered under the benefit plan.
- Preventive care not subject to deductible – Plan members can take comfort in the fact that routine preventive care provided in-network is not subject to the annual deductible. Members simply make the applicable copayments and those amounts are not taken from the HRA.
- Ability to add Flexible Spending Account (FSA) – If an FSA is part of the plan, employees can set aside pre-tax dollars to pay for covered health services as allowed by federal law. These reimbursements can be used to help satisfy their deductible requirement, make copayments, and more.
* The employer chooses the amount of the HRA and determines if and how much of the unused portion each year may be rolled over to the next year. Certain legal requirements also apply.
**Certain legal restrictions apply.