Excepted Benefit HRA (EBHRA)
Tax-free reimbursements for qualified health expenses
Overview & Eligibility
EBHRA Reimbursement Limit:
$2,100 annually
How it Works
An EBHRA is permitted only if employees are offered coverage under a group health plan sponsored by the employer. Here’s how it works:
- 1Employer establishes a reimbursement limit and qualified medical expenses
- 2Employees pay for qualified medical expenses with an Ameriflex Debit Mastercard®, or
- 3They pay out of pocket and submit a claim form for reimbursement
- 4Employees get reimbursed for eligible claims paid out of pocket
The Value for Employees
Employers designate which expenses are eligible. EBHRA funds can be spent on expenses such as co-pays, deductibles, dental and vision coverage, COBRA premiums, and long-term care.
Employers fund the EBHRA to offset rising healthcare costs and offer employees a convenient way to pay for health insurance.
Employees will receive an Ameriflex Debit Mastercard® linked to their EBHRA. Employees can use their card for eligible purchases everywhere Mastercard® is accepted. Account information can be securely accessed 24/7 online and through the mobile app.
The Value for Employers
EBHRA contributions are tax deductible. Employers get the flexibility they need to offer quality health plan coverage for their employees that is better tailored to the individual employee.
Employers can set up the EBHRA to reimburse employees up to $1,950 annually for expenses that may include vision insurance, dental insurance, short-term medical insurance, and eligible out-of-pocket expenses.
Healthcare is complicated. The Ameriflex Client Relationship Team is eager to answer questions and provide assistance. Our 85+ Net Promoter Score (NPS) far exceeds the healthcare average.
Excepted Benefit HRA (EBHRA) FAQ
What is an Excepted Benefit HRA (EBHRA) and how does it work?
An EBHRA is an employer-funded health reimbursement arrangement that allows you to provide tax-free reimbursements for certain qualified medical expenses. Employers set the contribution amount, and employees submit eligible expenses for reimbursement up to the annual limit established by federal guidelines.
Who is eligible to receive an EBHRA?
EBHRAs are available to employees who are offered a traditional group health plan, even if they choose not to enroll. Employers can offer EBHRAs to all eligible employees or to specific classes, as long as the arrangement is applied consistently within those groups.
What expenses can employees use EBHRA funds for?
EBHRA funds can be used for a wide range of qualified health expenses, including copays, deductibles, dental and vision coverage, COBRA premiums, and other eligible healthcare costs. This flexibility helps employees better manage out-of-pocket expenses not fully covered under their primary health plan.
How much can employers contribute to an EBHRA?
Employers may contribute up to the maximum annual amount permitted under federal regulations. This cap is adjusted periodically, allowing employers to design a benefit that aligns with both regulatory requirements and their benefits strategy.
How does an EBHRA compare to a traditional HRA?
An EBHRA is more limited than a traditional HRA. While traditional HRAs can reimburse a broader range of expenses and may offer greater flexibility, EBHRAs have a set annual contribution limit and cannot be used for individual health insurance premiums.They are designed to supplement a group health plan by helping cover additional out-of-pocket costs and benefits not included in major medical coverage, such as dental and vision.
Are there compliance or administrative requirements for offering an EBHRA?
Yes. EBHRAs must follow specific IRS and federal guidelines, including contribution limits, eligible expense rules, and required plan documentation. Partnering with an experienced administrator can help ensure compliance and simplify ongoing management.