HRA Savings Advantages

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Traditionally, if an employer provides health insurance benefits as a part of being a company employee, this is a very good thing. There is another increasingly popular route some employers are going in regards to providing health insurance though.  Its called an HRA, a Health Reimbursement Agreement.

HRA vs. Traditional Group Health Insurance Plans

Instead of having a group health insurance plan, some employers have opted to take part in an HRA, which gives tax-free money to employees for the purpose of purchasing their own individual health plans.  This helps not only to save money for the employer, but also allows individuals within the company to more accurately address their own unique health situations and chose coverage that provides them with the best options, instead of just going with whatever the company is going to provide.

Health care is a great thing, but having freedom to chose you own path when selecting health care is even better.  What is to say that one plan is going to be the best for everyone within an organization?  Employers can save themselves a lot of money in the long run, and also allow for their employees to get the best healthcare that they personally want too!

Other benefits for employers who switch to HRA’s

  • Companies that provide group health insurance for their employees spend a lot of valuable time and resources annually to do so.  By switching to a defined contribution healthcare system you can more adequately address other company specific goals and issues!  Basically this is like freeing up a whole department to concentrate on other company prerogatives.
  • A lot of companies are actually losing money these in providing group health insurance.  The cost of health benefits times the number of employees is, in most cases a situation that could be best rendered by allowing employees to be in charge of their own health insurance situations.
  • Without the burden of having in house help coordinate health insurance benefits for employees, they are free to work on other company specific goals, services, and products.  HRA’s will continue to change the landscape for companies who would like to provide the best and most flexible health care for employees, while maximizing productivity and saving money all at the same time.


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