Is there a benefit to having a health reimbursement account?

A health reimbursement arrangement, which is the technical name for a health reimbursement account, has several benefits, states the Internal Revenue Service. Employer-contributed funds in the HRA may not count toward gross income, reimbursements for qualifying expenses are tax-free, and unused funds may roll over to the next year.

HRAs must be funded by employers, according to the IRS. Employees may use the funds tax-free for certain medical expenses, such as health insurance premiums, long-term care coverage or prescription drugs. The HRA may reimburse an employee for the medical expense, or employers may offer a debit, credit or stored-value card.