Although an HRA can be tailored to any health care coverage, the most profitable approach involves the traditional High Deductible Health Coverage (HDHC).

To take this approach, the employer first purchases high deductible health coverage at significantly lower premiums, and then creates an HRA to cover the difference between the previous deductible and the HDHC deductible.

Taking this approach will save you money without creating more out-of-pocket expense for your employees. That's rarely possible in today's world.

Can I use this with a PPO / HMO?

Yes, you can by designing the HRA to cover all or a portion of the deductibles and copays. While this approach usually does not result in the dramatic overall premium reduction of HDHC, it can enhance the insurance's benefit structure.

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Do I even need insurance?

Some employers set up an HRA instead of providing a supplemental health plan or portions of the major health plan. For instance, the employer would set up an HRA covering dental and vision and either drop the vision/dental supplemental plan or carve out that portion of the insurance policy.

You can set up tiers (Single, Family, etc.), deductibles, and co-pays. Everything you would find in an insurance plan, but this time you have total control.

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Can I design wellness benefits?

Wellness programs have been an important component in HRAs for quite some time. Employers appreciate the advantages of having healthy employees.

Healthy employees . . . .

• Take less sick leave,
• Require less health care,
• Display better attitudes, and
• Produce more work.

Healthy employees are the type of employees that all employers want!

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