Is An HRA Right For Your Family? We've Got All The Info You Need Right Here!

Is An HRA Right For Your Family? We’ve Got All The Info You Need Right Here!


Open enrollment ends on December 15th! Our friends at Take Command Health are taking over to explain how HRA’s work. To learn more about providing insurance benefits for your household employees, click here!





Help Your Household Employees With Health Insurance Through An HRA


When it comes to your trusted nanny, private educator, or other household staff, it’s important to keep them happy—and healthy. With end-of-the-year bonuses in mind, consider setting up a health reimbursement arrangement (HRA) to reimburse your team (even if it’s just one person) for health insurance and medical expenses for the coming year. It’s tax-free for everyone and guarantees that your team has high quality and consistent coverage. Through the use of an HRA, your household can be considered a business and receive the same favorable tax treatment as big company group health plans with less hassle and expense. 


HRAs benefit employers and employees:

  • Tax-advantaged for employer and employee
  • Budget-friendly with predictable costs 
  • Customizable for your unique team
  • Personalized plan choice for your employees 
  • Ensures quality, ACA-compliant coverage for employees 





How Health Reimbursement Arrangements Work

HRAs are based on reimbursing your employees for health insurance rather than buying it for them. As an employer, you decide on an allowance amount and your employees will buy an individual insurance plan. Since they are by name arrangements instead of accounts, there is no pre-funding that needs to happen. You’ll only reimburse when an expense is incurred, like a monthly premium charge, a doctor’s visit copay, the cost for prescription medication. Your employee will upload a receipt to a third-party administrator like Take Command Health, and you can reimburse them on their paycheck or sync reimbursements with your payroll provider. 


Here are a few things to keep in mind:

  • Salary deductions aren’t allowed.
  • The HRA must be offered fairly to all household employees.
  • The employee must have their own individual health insurance and appropriate documentation in order to qualify for an HRA.  
  • Your household must have an EIN, or Employer Identification Number. 
  • You must withhold taxes from your household employee’s paychecks and wages must be filed on a W-2.
  • HRAs are a better choice than a health stipend from a tax perspective. 






How To Get Started

Take Command Health is an HRA administrator and employee enrollment platform that can make benefits for your household employees easy and affordable. Their platform handles all the accounting and legal legwork takes care of onboarding each of your household employees and makes tax-time easy and painless. 


Head over to Take Command Health to see if an HRA is right for your household.


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