Park City, Utah (PRWEB) February 17, 2013
Today, Zane Benefits, Inc. published new information on Health Reimbursement Accounts. Zane Benefits, which provides comprehensive and flexible alternatives to traditional employer sponsored health benefits, is the leader in defined contribution and health reimbursement arrangements.
According to Zane Benefits’ website, a Health Reimbursement Account, which is another term for Health Reimbursement Arrangement, or HRA, is a type of self-insured group health plan under which an employer makes available a specified maximum dollar amount to employees for the reimbursement of medical expenses and/or health insurance premiums.
Zane Benefits’ website outlines the following FAQs about Health Reimbursement Accounts:
What is the tax treatment of Health Reimbursement Accounts?
Assuming certain IRS rules are met, HRA reimbursements are excludable from employees' gross income under Sections 105 and 106 of the Internal Revenue Code.
How does a Health Reimbursement Account work?
An HRA works as follows:
1. A business establishes an HRA Plan with a specified monthly allowances for employees.
2. An Employee incurs a medical care expense (e.g. purchase of health insurance or doctor visit).
3. The Employee submits documentation for reimbursement to the HRA.
4. The HRA plan reimburses the employee tax-free for the expenses subject to the plan terms.
How does an employee benefit from a Health Reimbursement Account?
Health Reimbursement Accounts benefit employees because employees don’t pay taxes on the reimbursed expenses.
What happens to money in a Health Reimbursement Account at the end of the year?
Depending on the HRA plan design, unused HRA dollars during a plan year may roll over to the next plan year.
What expenses are covered under a Health Reimbursement Account?
Only eligible expenses can be reimbursed by an HRA. These expenses are defined by IRS rules and the HRA plan document.
Eligible expenses are those employees pay for out of pocket for medical care that’s provided to the employee, employee's spouse, and eligible dependents. Generally, IRS rules state that medical care includes items and services that are meant to diagnose, cure, mitigate, treat, or prevent illness or disease. Transportation that is primarily for medical care is also included. Health insurance premiums are also included to the extent that they have not already received favorable tax-treatment. Examples include:
1. Health plan deductible expense
2. Doctor’s office visit copay
3. Pharmacy expense
4. Individual health insurance premium
5. LASIK eye surgery
About Zane Benefits
Zane Benefits was founded in 2006 to provide a revolutionized SaaS (Software-as-a-Service) administration platform ("ZaneHRA") for Health Reimbursement Arrangements (HRAs) and defined contribution healthcare. The flagship software provides a 100% paperless administration experience to employers and insurance professionals that want to offer better health benefits without a traditional group health insurance plan at lower costs. For more information about ZaneHRA, visit http://www.zanebenefits.com.