Definition

Health Reimbursement Arrangement (HRA)

An employer-funded arrangement that reimburses employees for qualified medical expenses.

Full definition

An HRA is an employer-funded group health plan that reimburses employees, tax-free, for qualified medical expenses. HRAs are funded from general assets and differ structurally from 401(h) accounts, which are pre-funded inside a qualified pension trust.

Related terms

401(h) Account

A separate sub-account inside a qualified pension or annuity plan used to pay certain retiree medical benefits.

VEBA (501(c)(9))

A voluntary employees' beneficiary association used to fund employee welfare benefits.

Availability, tax treatment, and plan design depend on the facts and circumstances of the employer, plan document, participant group, and applicable law. 401h.com provides general educational information only — not tax, legal, actuarial, investment, or ERISA advice. Consult qualified tax, legal, actuarial, and plan professionals.