When employment ends, who retains the HRA balances?

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Multiple Choice

When employment ends, who retains the HRA balances?

At the heart of an HRA is that the funds are owned and controlled by the employer. An HRA is funded by the employer to reimburse employees for qualified medical expenses, and the balance isn’t portable with the employee if they leave the job. When employment ends, the unused HRA balance typically stays with the employer (or the employer’s plan), rather than going to the employee. The insurer administers the plan, and the government doesn’t own the balances, while the employee does not typically retain the funds after separation.

At the heart of an HRA is that the funds are owned and controlled by the employer. An HRA is funded by the employer to reimburse employees for qualified medical expenses, and the balance isn’t portable with the employee if they leave the job. When employment ends, the unused HRA balance typically stays with the employer (or the employer’s plan), rather than going to the employee. The insurer administers the plan, and the government doesn’t own the balances, while the employee does not typically retain the funds after separation.

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