HRA Account: Medical Expenses
Eligible Expenses
Reimbursements from the ERIP HRA will be allowed for IRS-approved medical expenses incurred by the employee, such as deductibles, co-pays, non-covered medical expenses, and after-tax health insurance premiums (COBRA, Retiree Plans, etc.)
Examples of IRS-allowed expenses*
- COBRA premiums
- Other After-Tax Health Insurance premiums
- Medicare part B and D
- Deductibles and co-payments
- Routine care/physical exams
- Transportation for medical services
- Lab fees
- Stop-smoking programs
- Hearing aids and related expenses
- Prescriptions
- Dental care and orthodontia
- Eye Glasses and Contacts
- Acupuncture
- Nursing Home or Services
*For HDHP PPO & Health Savings Account participants, reimbursements are limited to dental and vision services, until after the HDHP deductible is met.
Ineligible Expenses
Examples of expenses not allowed by the IRS:
- Individual or group pre-tax health premiums
- Expenses covered by an insurance or government program
- Cosmetic procedures
- Retin-A (unless for medical diagnosis), Rogaine and any other medicines prescribed for cosmetic purposes
- Expenses related to long-term care (personal and custodial care)
- Non-Prescription Drugs and Medicines
Whose Medical Expenses Can Be Included?
Reimbursements under an HRA can be made to the following persons.
- ERIP Participants
- Spouses and dependents of participants.
- Any person the participant could have claimed as a dependent on their return except that:
- The person filed a joint return,
- The person had gross income of $3,650 or more, or
- The participant and spouse if filing jointly, could be claimed as a dependent on someone else's 2010 return.
- The participant's child under age 27 at the end of the tax year.
- Spouses and dependents of deceased participant.
Additional resources and information can be found in IRS Publication 502, Medical and Dental Expenses.
* The IRS does not allow the use of HRA funds for expenses associated with a domestic partner, unless the partner qualifies as a dependent under IRS regulations.
