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Can I have a HRA and a healthcare FSA to cover healthcare costs?

Your employer may choose to offer you a health care flexible spending account (health FSA) as well as a health reimbursement account (HRA) and you can use both to save money while paying for your medical expenses. Your health FSA is an account set up by your employer but funded by you, usually through pre-tax automatic deductions from your paycheck. Your HRA is an account set up by and funded by your employer from which you can be reimbursed tax-free for qualified medical expenses up to a fixed dollar amount per year.

Unused amounts in your HRA may be rolled over to be used in subsequent years. Unused amounts in your FSA are subject to a use-it-or-lose-it provision by the Internal Revenue Service, which requires you to use or forfeit your FSA funds by the end of your plan year. Some plans include a grace period (no more than 2 1/2 months) that lengthens the amount of time you have to use your FSA funds, or a carryover provision that allows you to roll over a certain amount ($500 maximum) of your FSA funds for the next year.

Before enrolling in a HRA or FSA, be sure to read all plan documents carefully to be sure you understand the benefits and restrictions of the plans your employer offers.

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Important: This content reflects information from various individuals and organizations and may offer alternative or opposing points of view. It should not be used for medical advice, diagnosis or treatment. As always, you should consult with your healthcare provider about your specific health needs.