The complete list of HRA eligible expenses

A Heath Reimbursement Arrangement, HRA, is a popular employee benefit plan that allows employees to use pre-tax dollars to pay for qualified medical expenses and individual insurance premiums. HRAs are a great way for employers and employees to save on healthcare costs. How they work is once an employer decides on an HRA type and plan design, employees submit for reimbursement on qualified medical expenses. This guide will show you how to get the most out of your HRA by knowing the ins and outs of eligible HRA expenses.

HRA Eligible Expenses

First, let’s understand the two most common types of HRAs and how they function.

QSEHRA: The Qualified Small Employer Health Reimbursement Arrangement is designed for employers with less than 50 full-time employees. An employer has the flexibility to design the plan to cover either certain qualified medical expenses and/or individual health insurance premiums.

ICHRA: The Individual Coverage Health Reimbursement Arrangement is for employees of any size; however, reimbursements must be used toward health insurance premiums purchased on the exchange. Depending on the employer, they may also opt to include certain qualified medical expenses for reimbursement in addition to the cost of premiums.

How are HRA Qualified Medical Expenses determined?

Qualified medical expenses for an HRA are those that would be eligible for reimbursement under a typical major medical plan. This includes deductibles, copayments, coinsurance, or out-of-pocket costs. In addition, qualified medical expenses for an HRA can also include dental and vision care expenses, as well as prescription drugs. The list of qualified medical expenses is determined by IRS; see IRS Publication 502.

Have questions?

What medical expenses can be reimbursed by an HRA?

Health Reimbursement Arrangements (HRAs) are designed to give employees more flexibility in managing their healthcare expenses. Understanding what is covered under an HRA is crucial for maximizing this benefit. Here’s a breakdown of the types of medical expenses typically eligible for reimbursement through an HRA.

Medical Care

HRAs typically cover various medical expenses, including visits to healthcare professionals, hospital services, lab tests, and preventive care. These expenses are considered HRA-eligible if necessary for disease diagnosis, cure, mitigation, treatment, or disease prevention. Expenses like doctor's visit co-pays are also covered under most HRAs, answering the common question, "Does HRA cover copay?" with a yes.

Dental Care

Dental care is another category frequently covered by HRAs, encompassing services like dental checkups, cleanings, fillings, extractions, dentures, and orthodontics. These services must primarily alleviate or prevent a dental ailment or disease. Cosmetic dental procedures, however, are typically not considered HRA-qualified expenses unless they are necessary to treat a medical condition.

Vision Care

Vision care is also commonly reimbursable through an HRA. This includes expenses related to eye exams, prescription eyewear, contact lenses, and even corrective procedures like LASIK. If you're wondering, "Can I use HRA for glasses?" the answer is generally yes, as long as a healthcare professional prescribes the glasses.

HRA Eligible Expenses: Comprehensive List

To expand upon the three primary categories above, here is a comprehensive list of HRA qualified expenses.

Procedures and Treatments:

HRA qualified expenses with a prescription or note from a doctor

Some qualified expenses need a prescription or a note from a doctor to be eligible for reimbursement.

Supplements and Nutritional Support:

Specialized Therapies and Treatments:

Medical Devices and Services:

Professional and Supportive Services:

Insurance Premiums

There are many different kinds of insurance premiums. The IRS has also listed which premiums qualify as medical expenses.

What medical expenses CANNOT be reimbursed?

The IRS also guides what can’t be deducted as an HRA qualified medical expense.