How do the HRA payments and reimbursements work?
A Health Reimbursement Arrangement (HRA) is a group benefits plan that allows employers to reimburse employees for qualified medical expenses. Individual health insurance policy premium is considered a qualified medical expense. Array manages all employee claims made against the HRA. The claims come from two sources. The first is from insurance carriers which send all employees’ health insurance policy invoices directly to Array. The second source is from employees who manually submit claims for qualified medical expenses. All payment for insurance premium must come from the employee. Individual health insurance policies are neither tax-exempt nor tax deductible for employees. Employee payments must therefore be made from net-pay. Each month Array sends the employer a report and invoice. The report states the amount of the employees’ premium due and all employer reimbursements for claims made against the HRA. The employer uses this report to collect the insurance premium from employees
