What is a Health Resources Account?

Question

My health insurance deductible will triple in October: Help!

I've been told to ask about an HRA or Health Resources Account to help offset this terrible increased cost. Anyone out there know how this works? Is there a tax break for the employer? I'm just sick over this, and may have to leave my employer of over 10 years because of this. Please advise.

Answer 1

First of all if you're not on an indiviudal plan try that as I find many people on a group plan because they think it's cheaper.  

Secondly an HRA allows you to apply corporate dollars to health expenses.  There's no real "account" to per se.  If you submit $500 of medical bills (for example) your employer would write you a check for it.

If you're self-employed you can't use it on yourself, but you could hire your spouse and use it on them.  BUT, before you go through that mess just consider an HSA which I think is better from the bottom up for the flexibility, the savings aspect, and the administration (you can look at my site to read up on an HSA).  

The only one company that really pushes the HRA and their plans should be avoided altogehter because they are very limited in scope.  Not to say an HRA is necessarily bad, but you need to consider the source.

Have your employer implement a plan so you (or they) can contribute to an HSA OR consider staying with the employer and moving to indiviudal coverage.  Most small employers have their employees just get their own coverage because it's generally about half the cost of group coverage (usually).

Hope that helps.

Jeff