Funded HRA FAQs

What is a Health Reimbursement Arrangement (HRA)?

An HRA is an employer-funded health plan that provides individual accounts for reimbursing participants and their spouse and eligible dependents for qualified medical expenses and permits any unused portion of the account at the end of the year to be carried forward to the next year. Unlike flexible spending accounts, there is no annual “use it or lose it” requirement.

How does the retiree HRA from Voya work? 

• An HRA must be funded solely through employer contributions or mandatory employee contributions made on a pre-tax basis. The amount and frequency of contributions are determined by the Plan.   
• The HRA reimburses — tax-free — qualified medical expenses incurred by individuals who have either 1) terminated service and have reached the required retirement age based on their retirement system or 2) retired for service, service-connected disability, or nonservice connected disability. If an employee becomes a member of a reciprocal retirement system, the HRA funds can be accessed after retirement from that system.  
• The HRA reimburses qualified out-of-pocket health care costs, including but not limited to, health, dental, and vision insurance premiums, co-pays and deductibles, prescription costs, Medicare Parts B & D premiums, Medicare supplement insurance premiums, and qualified Long-Term Care insurance premiums incurred by employees, their spouses and qualifying dependents.  
• The only funds available in the HRA are the contributions made while employed, as well as any investment returns on those funds. Once the funds in the HRA are exhausted, eligible employees will no longer be able to reimburse their qualified medical expenses.  
• When an employee becomes eligible to receive reimbursement for qualified medical expenses, instructions on how to submit a reimbursement request are provided. In addition, the HRA Participant Portal — accessible online and via mobile app — provides a comprehensive list of eligible expenses.

What happens to the assets in my account upon death?

Death benefits cannot be provided under an HRA. Amounts in the account can only be used for qualified medical expense reimbursements. This is because IRC Section 105, which provides the basis upon which the HRA Guidance was made, provides an exclusion from tax only if amounts are used for qualified medical expenses.

Amounts remaining in the account at death can be used to reimburse qualified medical expenses for the spouse or dependents of the deceased employee/retiree. The terms of the Plan would dictate how this continued coverage will be provided. If no spouse or dependents survive the employee/retiree, amounts remaining in the account may be forfeited.

If I leave my employer, can I move my HRA to my new employer?

Generally, no; however, should you be vested in the HRA Plan, you will be able to process claims against the assets in your account until it is exhausted. The HRA would continue to reside in the Trust your employer established to hold the assets.

How are the assets supporting my HRA protected?

The assets contributed by your employer are held in a Trust. Your employer established this Trust to shelter the assets from creditors and has established an Oversight Board to act as a fiduciary and manage the Trust for the exclusive benefit of those participants covered by the HRA Plan.

There are two Trust arrangements for HRAs. Both arrangements provide protection of HRA Plan assets and are designed to assure participants that the assets in their HRA will not revert back to their employer.

1. Voluntary Employees’ Beneficiary Association (VEBA) Plan – A VEBA is a type of tax-exempt trust used by its members and eligible dependents to pay for eligible medical expenses. The plan is typically funded by an employer. Depending on the organization, plan employee contributions may or may not be mandatory, although individual elections are not permitted. However, employees must be covered by an employer-sponsored health plan to be eligible for VEBA membership.  
2. Section 115 Integral Part Trust – An IRC Section 115 trust provides tax-exclusion for income derived from any essential government function. The IRS has ruled that a separate entity (e.g., a trust) may qualify for this exclusion, so long as the entity is performing some government function. A trust providing employee welfare benefits to government employees will be considered an integral part of the state or political subdivision, thereby entitling it to tax-exclusion under IRC Section 115.

Are contributions to an HRA taxable to employees?

Employees are not taxed on employer contributions. IRC Section 106 provides tax-exclusion for contributions an employer makes to an HRA.

Are withdrawals from an HRA taxed?

Assets used to pay for qualified medical expenses are not taxed. IRC Section 105 provides tax-exclusion for amounts received as reimbursement of medical care expenses.

What are the tax consequences should an HRA be shown to not qualify?

If an HRA fails to meet the requirements provided in the HRA Guidance, all distributions made, including those for qualified medical expenses, will be taxable to the participants.

How are taxes filed if there is a distribution from the HRA?

Expense reimbursements under HRAs for qualified medical expenses are not reportable to the IRS. Distributions for any other purpose are not allowed by the Plan and would be subject to IRS reporting requirements.

Who is eligible for an HRA?

Eligibility requirements (for enrolling in the plan, receiving contributions, and for receiving reimbursements) are as established by the HRA Plan. An HRA provides reimbursements for former employees after termination of employment or retirement. An employee who has met the requirements for receiving reimbursements is referred to as “claims active.”

How are contributions determined in an HRA?

The amount and frequency of contributions are determined by the Plan. There are no IRC limits to the amount that may be contributed. The HRA Plan may place limits on contributions.

Can I make contributions to my HRA?

No, you cannot voluntarily choose to contribute. According to the IRS, an HRA must receive contributions only from the employer or from mandatory employee contributions. Employees may not contribute on their own. Contributions are not includible in income and reimbursements from an HRA that are used to pay qualified medical expenses are not taxed. The one exception is when an employee makes contributions as allowed under COBRA continuation. The Consolidated Omnibus Budget Reconciliation Act (COBRA) gives workers and their families who lose their health benefits the right to choose to continue group health benefits provided by their group health plan for limited periods of time under certain circumstances such as voluntary or involuntary job loss, reduction in the hours worked, transition between jobs, death, divorce, and other life events.

How do I get access to the assets in my HRA?

Assets in an HRA may only be used to reimburse a qualified plan participant for qualified medical expenses. When you become eligible to receive reimbursement for qualified medical expenses (i.e., you become “claims active”) you will receive instructions on how to submit a reimbursement request. In addition, the HRA Participant Portal — accessible online and via mobile app — will provide a comprehensive list of eligible expenses.

Who is a qualified plan participant?

A qualified participant is an employee, a previous employee, the spouse or dependent of an employee or previous employee who has a vested benefit under the plan. See your employer’s plan document for a detailed explanation of qualified participant.

Can an HRA have a vesting schedule?

Yes. Vesting is the right to non-forfeitable ownership of employer contributions. An HRA may be non-forfeitable, depending on the terms of the HRA Plan. Assets in your HRA are only available to pay claims once you have satisfied the vesting requirements of your HRA Plan.

Who is managing my HRA?

The overall HRA experience is managed by Voya. Third party administration services for your HRA are provided by Benefit Plan Administrative Services, Inc. (BPAS) and, in part, by WEX Health, Inc. The HRA Participant Portal, including investment information and account statements, is hosted by BPAS. Once you become claims active, your expense reimbursements and related communications are managed by WEX.

How do I access my HRA?

You can access the HRA Participant Portal from www.voya.com/ws/myHRA. If you have a retirement plan with Voya, you can also access the HRA Participant Portal by logging into your retirement account online or the Voya Retire mobile app. Once in the Portal, you will have full access to your account and once separated from service, you will be able to use the balance in your account to reimburse yourself for qualified medical expenses. If you have a retirement plan with Voya, you can also view your HRA balance and access the HRA Participant Portal by logging into your retirement account online or the Voya Retire mobile app.

How is my HRA being invested?

Your employer has selected an investment option in which contributions will be invested, until such time that you, as the plan participant, make allocation changes and/or fund transfers. Each participant will receive confirmation containing the specifics on the funds your employer has selected for your HRA Plan. More information on the investment options available are provided to you at time of enrollment.

Can I change the way my HRA assets are invested?

Yes. Your employer has provided funds that represent a variety of asset classes from which you may select. You may change your allocation online. Additionally, you should carefully review the investment information and prospectuses before making your investment decision. Account values fluctuate with market conditions, and when withdrawn the principal may be worth more or less than its original amount invested.

How do I view or change my investment elections for future contributions?

You can make changes by accessing your account in the HRA Participant Portal from www.voya.com/ws/myHRA. If you have a retirement plan with Voya, you can also access the HRA Participant Portal by logging into your retirement account online or the Voya Retire mobile app. Once in the Portal, choose My Account, then Investments, and select the Make Changes tab. You will then want to select the option to change how your future contributions are invested. Once selected, you will see a grid displaying all investment offerings within the plan along with your current investment election percentages for future contributions. Simply enter your desired percentages next to each investment or use the +/- feature to change your number. The total must add up to 100%. Submit your changes and select confirm to process your requested change and receive your transaction number. All transactions must be initiated prior to the stock market close to be processed same day.

How do I change the way my current account balance is invested?

You can make changes by accessing your account in the HRA Participant Portal from www.voya.com/ws/myHRA. If you have a retirement plan with Voya, you can also access the HRA Participant Portal by logging into your retirement account online or the Voya Retire mobile app. Once in the Portal, select My Account, then Investments, and choose the Make Changes tab to find two methods to change the investment of your current account balance:

1. Transfer Investments – This option allows you to transfer money from one investment option to another. Start by following the option to transfer out by a dollar amount or a percentage. Select the investment from the drop-down menu that you wish to transfer money out of, and then indicate the percent or dollar amount you want to transfer. Now, enter the percentage(s) among the new investment(s) for which you wish to transfer; the total must add up to 100%. Submit your request and then Confirm. Note: This change will only affect the way your current account balance is invested; it will not change how future contributions are invested in your account.
 
2. Rebalance – This option allows you to rebalance your account in two different ways:
   • Rebalance your current investments: provide specific percentages for each investment
   • Rebalance your current investments and match your future contributions

For either rebalance option, enter your desired percentages next to each investment in the grid. The total must add up to 100%. In addition, if you would like your current account balance to be automatically rebalanced to these percentages, scroll down and click the box next to Automatically Rebalance My Account. Then select the frequency in which you would like your account to be automatically rebalanced. Then Submit and Confirm your request. Note: Using the account rebalancing option will trigger a new set of trading restrictions initially and whenever your account is rebalanced. For this reason, you may choose to use annual rebalancing rather than the quarterly option.

How do I transfer out of an investment option?

You can make changes by accessing your account in the HRA Participant Portal from www.voya.com/ws/myHRA. If you have a retirement plan with Voya, you can also access the HRA Participant Portal by logging into your retirement account online or the Voya Retire mobile app. Once in the Portal, select My Account, then Investments, then Make Changes. Select Transfer Investments, then follow the prompts. If you are moving all monies out of an investment, select 100%. This will prevent any small residual amounts from remaining in the investment. You may also want to check your Future Elections to ensure future contributions are being invested in the manner you choose.

What is a qualified medical expense?

Section 213(d) of the Internal Revenue Code defines “qualified medical expenses.” When you become eligible to receive reimbursement for qualified medical expenses you will receive instructions on how to submit a reimbursement request. A list of eligible expenses is available for your review. 

How do I process a claim?

Claims are submitted through the HRA Participant Portal or via the Voya Health Solutions mobile app. When you become eligible to submit claims, additional resources and information will be made available to you through the HRA Participant Portal. In addition, you will receive two debit cards to assist in paying for qualified medical expenses.

How do I pay for qualified medical expenses?

Use your Voya Debit Card to pay for eligible medical expenses at the point of purchase, eliminating the need to submit reimbursement requests. Eligible items are automatically approved at authorized merchants and paid from your HRA.

In addition to using your debit card, you can also pay for an eligible medical expense via other payment methods and simply submit a reimbursement request from your online account or mobile app. You may also complete a paper Reimbursement Request form and fax, email, or mail it with verification to Voya. Your funds are not tied to a plan year and never expire.

How long will it take to process my reimbursement claim?

Generally, no more than one to two weeks from when you submit the request.

Can I use my HRA to pay for medical expense I incurred prior to becoming a member of the plan?

No. Reimbursements are not permitted for expenses incurred prior to the effective date of the HRA or before the date the participant first became enrolled in the HRA. Reimbursements are also not permitted for expenses for which a deduction was allowed on any prior year Form 1040.

Can I request a distribution from my account directly from Voya?

No. Expenses paid from an HRA must be reviewed to determine if the claim is a qualified expense and if the expense has been incurred by a qualified individual. A more detailed discussion on how to process a claim is available in the HRA Participant Portal.

Can I use my HRA to pay for long-term care?

Long-term care expenses are not considered qualifying reimbursable expenses. Qualified long-term care insurance premiums are acceptable. Check your HRA Plan document for any specific benefit restrictions.

Who do I contact with questions?

Should you have additional questions about your HRA, you can contact Voya Financial Health Account Solutions for account or claims processing information.

Toll-free: (833) 232-4673 Monday – Thursday, 8 a.m. to 6 p.m. ET; Friday 8 a.m. to 5 p.m. ET

Toll-free Secure Fax: (855) 370-0670

Email: HASinfo@voya.com