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How can I use my HRA?

Who is this for?

Michigan Health Insurance – Customer Service – Health Spending Accounts

If you have a health reimbursement arrangment, or HRA, linked to your plan, this information can help you learn how to use it to pay for qualified medical expenses.

An HRA is a fund set up by your employer. It's a kind of health spending account used to pay for out-of-pocket costs not covered by your company's standard insurance plan. Your employer will decide with expenses are eligible, but HRAs typically cover:

  • Deductibles
  • Copays
  • Coinsurance
  • Other services

Unfortunately, you can't use an HRA to pay for monthly health insurance premiums.

How do I know if I have an HRA?

You have an HRA if you get your insurance through your employer and you have one of these plans:

How does my HRA work?

It's pretty simple. Your employer contributes a set amount of money to your HRA each year for your use. Unlike other health spending accounts, only your employer can put money into your HRA.

When you go to the doctor or hospital, the money in your HRA will cover eligible expenses, like your deductible for the service. You don't need a debit card, or have to worry about getting or submitting bills. They'll automatically get payment. You'll see the payment listed on your Explanation of Benefits, or EOBs, as well as on your online Personal Desktop.

If you use up all the funds in your HRA before the end of the year, you'll have to pay any additional out-of-pocket costs. If you have money left over, your employer may let it roll over to the next year.

What are the advantages of an HRA?

  • Affordability: Premiums for health insurance plans offered with an HRA are generally less per month than other plans.
  • Employer contributions: There is no cost to you. Your employer funds your HRA.
  • Tax benefits: Your HRA dollars are not taxed.

What happens to my HRA when I leave my employer?

You can’t take your HRA balance with you when your employment ends. However, you may be able to continue your plan coverage through COBRA.

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