4 Tips to Get the Most From Your HRA
4 min read •
30 sec brief
If you're enrolled in a Health Reimbursement Account (HRA), it’s vital to know the ins and outs of your plan to get maximum results.
If you’re enrolled in a Health Reimbursement Account (HRA), it’s vital to know the ins and outs of your plan to get maximum results. There are several HRA account types, so you’ll need to check your plan for the specifics.
Here are four things to keep in mind when dealing with your HRA account.
Know Who is Eligible
The IRS has very specific rules as to who is eligible for coverage. Your HRA covers qualified healthcare expenses for you and your eligible dependents including:
- Qualifying Dependents (qualifying children, qualifying relatives)
To find out if someone qualifies, check out IRS publication 969 (pg 18) and IRS publication 502 (pg 4) for detailed definitions of each type of dependent.
Know What is Covered
The next important piece of the puzzle is knowing what medical expenses your HRA covers. HRA qualified medical expenses are those that would generally qualify for the medical and dental expense deductions. Refer to IRS Publication 502 for a detailed listing.
Of note, non-prescription medicines (except for insulin) aren’t considered qualified medical expenses for HRA purposes. To qualify as a medical expense for an HRA, the medicine or drug must meet three criteria:
- Require a prescription
- Be available without a prescription (an over-the-counter medicine or drug) and you can get a prescription
Qualified medical expenses from your HRA include the following:
- Health insurance premiums
- Long-term care coverage
- Amounts that aren’t covered under another health plan
Keep Those Receipts
The IRS requires every expense be verified with a receipt for HRA reimbursement. There are five key pieces of information to be sure receipts include:
- Patient Name: Name of the person who received the service or item (may be excluded from retail store purchases).
- Provider Name: name of the provider or merchant who provided the service.
- Cost: the amount paid for the service or item and/or the portion not reimbursed through your insurance carrier.
- Date of service: date services took place or items were purchased
- Type of Service: a detailed description of the items purchased or service provided (a bag tag from the pharmacy is sufficient for prescriptions).
There are several ways to keep records, including keeping paper receipts or taking a photo of each receipt and storing the images on your computer or online. Many HRA providers have portals to keep track of your account online and upload receipt images for easy record keeping.
Keep an Eye on Your Account
Because an HRA requires a lot of record management on your part, you’ll want to keep a close eye on your account to make sure things are going smoothly. It’s easier to fix issues when you discover them sooner rather than later. Many companies provide some type of portal to be able to view your account easily online.
HRAs are another handy tool to use for healthcare expenses. Hopefully putting these tips to use will help you use your HRA to the fullest extent.
If you need more help with health account decisions, check out our blog. We will make you a healthcare benefits expert in no time, without any extra work or effort on your end.
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