A Health Reimbursement Arrangement (HRA) is a powerful solution that allows plan participants to pay tax-free for medical expenses that are determined by the Internal Revenue Service (IRS) and the employer. Knowing the ins and outs of which medical expenses are eligible for reimbursement may seem tricky, but it doesn’t have to be. With the right tools and information, you can get the most out of your HRA and avoid paying for expenses that you believed were reimbursable.
Things To Keep In Mind
- Eligible expenses can vary depending on your plan’s unique design.
- Although the expense may be considered eligible by the IRS, the employer can actually determine from that list which are eligible under the plan.
- MidAmerica does not determine which expenses are eligible and which ones are not. These guidelines are set forth by the IRS and employer, and MidAmerica abides by these standards to maintain your plan’s compliance.
It’s not uncommon for MidAmerica to receive claims that must be denied because they do not meet the qualifications set forth by the IRS and employer. To help you better understand which expenses are ineligible, continue reading to see commonly submitted claims that are denied.
- Everyday Health Items – Unless participants can receive a doctor’s note, general health items such as toothpaste, suntan lotion and vitamins are not reimbursable. This is because they are considered items that would be used regardless of any medical condition. However, sunscreen (which has a higher SPF than suntan lotion) and some supplements may be eligible for reimbursement. Be sure to review your plan highlights to confirm if the expense is available for reimbursement. If your plan is on MidAmerica Journey, you can also submit a claim through the Journey portal to gain access to a list of expenses that are eligible.
- Warranties or Funeral Expenses – Although warranties or funeral expenses can be associated with the result of a medical expense, they themselves do not qualify and are not reimbursable.
- Dental and Vision Discount Programs – Discount programs are made to help participants with the cost of medical expenses. But since enrollment in the program itself is not medically necessary, that expense is not reimbursable. When participants do utilize these programs, MidAmerica carefully reviews the itemized doctor’s bill and only reimburses the out-of-pocket portion of the medical service, excluding the price of the discount program.
Understanding expense eligibility may sometimes seem complicated, but we’re here to help you navigate the guidelines. If you would like to see a complete list of eligible and ineligible expenses, click here to view IRS Publication 502. We also encourage you to visit our Resources page to download additional HRA tools and information. To obtain a copy of your Plan Highlights, log into your online portal.