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Health Reimbursement Arrangement A Health Reimbursement Arrangement (HRA) is an account funded by your employer to help you pay for your health care expenses. It’s typically paired with a lower-cost, higher-deductible health plan.

Here’s how it works:

Your employer funds your HRA with a set annual amount (for example, $500 or $1,000), and determines what qualifies for reimbursement.  You can use this money to pay your out-of-pocket medical expenses, such as copays or coinsurance for office visits, prescription drugs, and other services.

If you don’t use the entire amount in your HRA, the remaining amount can roll over to the next year for future use, depending on the plan design. If you leave the company, your employer keeps the remaining balance.