Health Reimbursement Arrangement

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Health Reimbursement Arrangement

 

As a licensed Third Party Administrator (TPA), Xenium can help you establish and administer your Health Reimbursement Arrangement (HRA) plan for medical plan deductible reimbursement only.

What is a Health Reimbursement Arrangement? An HRA is an employer provided plan to pay or reimburse certain medical expenses, as determined by the employer, and not already covered by insurance.

The cost savings of providing an HRA in conjunction with a high deductible health plan can be significant due to the premium savings realized by increasing the deductible on the health plan design. It’s a win-win situation for both the employee and employer. Employees pay lower premiums and receive employer assistance with their deductible, while employers save cost on premiums.

HRA’s reimburse employees for qualified medical expenses, just as an insurance plan would reimburse covered individuals for the cost of services incurred. Employers qualify for preferential tax treatment of funds placed in a HRA in the same way that they qualify for tax advantages by funding an insurance plan. (Employers can deduct the cost of an insurance plan — and now a health reimbursement account — as a business expense under Internal Revenue Code Section 162.)

There are specific requirements for setting up an HRA. The HRA services Xenium offers are deductible plan reimbursement only. This means the program can only be used to reimburse deductible out of pocket costs incurred by the employee, his or her spouse, and qualified dependents. The HRA also must be totally funded by the employer. Xenium, as the plan administrator, must verify that all medical expenses qualify for reimbursement according to the established guidelines.

 

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HRA Services provided:

  • Tracking of deductible by participant in the plan
  • Notification of qualified expense to client for participant reimbursement
  • Model plan document, summary plan description, on-going plan amendments and summary of material modifications
  • Tracking of expense reimbursements request against the S125 plan if Xenium plan
  • Coordination of COBRA included if using Xenium sponsored Health Plan
  • Education for employee base on how the HRA works and how to submit forms

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