What is the primary function of Health Reimbursement Accounts (HRAs)?

Health Reimbursement Accounts (HRAs) are designed to assist employees with the payment of medical expenses, particularly for those who are enrolled in high-deductible health plans (HDHPs). The primary function of HRAs is to reimburse employees for qualified medical expenses, which makes healthcare more affordable while also encouraging employees to take a more active role in managing their healthcare costs.

HRAs are employer-funded accounts, meaning that the employer contributes money that can then be used by employees to cover out-of-pocket medical expenses. This is especially beneficial for individuals with high deductible plans, as these employees may face significant expenses before their insurance benefits kick in. By reimbursing these costs, HRAs help mitigate some of the financial burden associated with high deductibles.

In contrast, other options do not accurately represent the functionality of HRAs. For instance, they do not provide tax refunds for medical expenses directly nor do they offer discounts on medical bills. Similarly, while HRAs can complement health savings accounts (HSAs), they do not fund them; instead, HRAs operate independently and have different regulatory frameworks and restrictions. Thus, the primary function of HRAs being to assist with the payment of medical expenses on high deductible plans is both accurate and the most relevant understanding of their