The document explains Health Reimbursement Arrangements (HRAs), which are employer-sponsored benefit plans allowing employees to be reimbursed for qualified health care expenses. It details the reimbursement process, types of eligible expenses, and the tax benefits of HRAs, while emphasizing the employer's control over funding and allowances. Additionally, it covers insurance shopping options during open enrollment and highlights important insurance terms.

1. How the HRA
works for employees
Disclaimer: The presentation provided is general in nature and does not apply to any specific U.S. state except where noted. Health insurance regulations differ in each state. See a licensed agent for detailed information on your state. PeopleKeep, Inc., does not sell health insurance.

2. Our story
At PeopleKeep, we’re passionate about helping small
businesses offer competitive benefits to their
employees at a price they can afford.
Our cloud-based benefits software automates
benefits compliance and employee support—
enabling businesses to manage their benefits in just
minutes per month.
Today, 3,000+ companies across the United States
trust PeopleKeep to successfully automate their
benefits.
PeopleKeep is located in scenic Salt Lake City, Utah.

3. What
we’ll cover
What expenses are reimbursable?
How an HRA works
What is an HRA?1
2
3
4
5 What is the reimbursement process?
Shopping for health insurance

4. Katie Allred, HRA Customer Support Specialist
As a customer support specialist, Katie has helped both admins and
end-users navigate and utilize their benefits for several years. When
she's not out to see a favorite band, or checking out new live music,
you’ll probably find her at home reading a good book.
About the presenter

5. What is an HRA?
Overview
Health reimbursement arrangements (HRAs) are
employer-sponsored benefit plans. Employers set
aside a specific amount of money for employees to be
reimbursed for qualified health care expenses.
HRA reimbursements are:
● tax-deductible to the employer
● tax-free to the employee

6. How an HRA works
4 easy steps
1. Employee is offered a monthly benefit allowance from employer
Employees have flexibility to create a benefits package to meet their needs.
2. Employee incur health care costs
Employees use their monthly allowance to pay for individual health insurance or out of
pocket costs.
3. Employee requests reimbursement for eligible medical expenses
Employee submits medical expense documentation for reimbursement. [PeopleKeep]
reviews the reimbursement request and informs company and employee of expense
verification.
4. Employee receives health care reimbursement from company
The company reimburses the employee for the expense up to the allowance amount.

7. How an HRA works
Whose money is it?
Unlike other types of employer-sponsored health care benefits, the employer finances the
HRA.
is for Arrangement not Account
● An HRA is not an insurance plan
● HRAs are notional arrangements,
they don’t need to be prefunded
● Employees cannot contribute to
their employer-funded HRA

8. How an HRA works
What is an allowance?
An HRA employee allowance is the amount of tax-free money that an employer has set for
each employee.
The HRA allowance amount depends on the:
● type of HRA
● decisions made by the employer

9. How an HRA works
Does an HRA allowance roll over?
HRAs do allow some allowance rollover. Depending on which HRA plan an employer
chooses, health reimbursement arrangement balances may roll forward from month
to month or from year to year.
● Generally, a monthly rollover is automatic and annual rollover is permitted based
on the employer's decision.

10. How an HRA works
What happens with the HRA money when the employee leaves?
The unused HRA allowance money stays with the company when an employee leaves
their job, retires, or is let go.
● However, there is usually a 90-day runout period during when employees can
submit reimbursement requests for expenses incurred during employment.

11. Shopping for health insurance
Where can I shop for an insurance plan?
Open enrollment is the one time employees shop for insurance. Employees can compare
and shop for an individual private health insurance plan that meets government standards
through a federal or state exchange/marketplace or off exchange.
Shopping Options
● Federal exchange.
www.healthcare.gov
● State exchange.
Limited state availability
● Off-exchange.
Contact insurance carrier directly
Or, contact a broker for help for all types
State Exchanges
States exchanges in blue.

12. Shopping for health insurance
When can I shop for insurance?
The 2020 Open Enrollment Period began
November 1, 2019, and ends December 15, 2019,
for most states.
Some states exchanges choose to extend their
Open Enrollment 2020 period.
● For individuals who have had certain life
events, including losing health coverage,
moving, getting married, having a baby, or
adopting a child— a Special Enrollment Period
(SEP) is available.
States With an Extended 2020 Open Enrollment Period
States With an Extended 2020 Open Enrollment Period

13. There are four levels or metal tiers
for health insurance plans:
1. Platinum
2. Gold
3. Silver
4. Bronze
The tier indicates the percentage of
health care expenses the plan will
pay.
Shopping for health insurance
Health coverage basics
Metal Tiers of
Coverage

14. Shopping for health insurance
Health insurance terms to know
To select the right health insurance plan for you, it’s important to understand key
insurance terms.
● Premium. The amount you pay to the insurance company for the plan, usually
monthly.
● Deductible. The amount paid for covered care before the insurer begins to pay.
● Copayment. A flat dollar amount paid to the health care provider for a covered
service.
● Coinsurance. The percentage of allowed charges for covered services you are
required to pay.
● Out-of-pocket maximum. The maximum amount of money you will pay for
covered services during a benefit period.

15. What expenses are reimbursable
Introduction to IRS Publication 502
HRAs can only be used for eligible health
care expenses are defined in IRS
Publication 502.
● Eligible expenses must be incurred by
the employee and their family
● Expenses must take place within the
HRA plan year

16. What expenses are reimbursable
Sample types of eligible expenses
HRA-eligible expenses include items such as:
● Individual health insurance premiums
● Individual dental or vision premiums
● Amounts paid toward a policy's
deductible
● Copays
● Office visits
● Prescription drugs
● Non-prescription drugs (with a doctor's
note)
● Mileage for travel to/from eligible
health care

17. What is the reimbursement process
What are the documentation requirements?
The PeopleKeep documentation team will review reimbursement documentation to verify the
expense(s) are eligible under the IRS Publication 502 regulations.
The documentation must include:
● the service or product
● the date of the service or sale
● and the amount incurred
The employer will only be informed of the verified expense amounts. They will not be given
access to any of the health care documentation submitted, regardless of eligibility verification.

18. What is the reimbursement process
How do I submit my expenses?
The submission process is simple.
Employee submits documentation
for reimbursement via upload to
PeopleKeep employee portal
Documentation
team reviews
Documentation team verifies
expense eligibility

19. What is the reimbursement process
How will I receive my reimbursements?
Once expenses are verified, PeopleKeep notifies
the company of the reimbursement amount for
each employee.
● Most companies include reimbursements
with employee payroll
● The unused allowance will roll over
month-to-month, for most plans
HRAs save employees
and companies an
average of 35 percent in
taxes compared with
wages while giving you
full control of your
benefits.
35%
average savings

20. Health reimbursement arrangement
Key takeaways
Because an HRA can reimburse medical expenses as well as premiums, it's a very valuable
benefit for employees in many insurance situations.
7 key takeaways
1. The business is in charge of the HRA— the A is for “arrangement,” and not “account.”
2. The business determines how much is contributed to the HRA.
3. Unused HRA money stays with the company.
4. HRAs can reimburse anything in IRS Publication 502.
5. HRA money can be used to pay for family medical expenses.
6. Open enrollment is the one time employees shop for insurance, unless SEP eligible.
7. Shop for insurance plans via Federal/state exchanges, or contact an insurance agent for help.

21. Thank you for joining us today.
Our next HRA series session is December 17th.
We hope you’ll join us!