Which Type of CDHP is a better fit for you?
Both HSAs and HRAs have distinct advantages and disadvantages for both the employer and the employee 
= Advantage
Hold the curser over each criteria topic to see an explanation
Employer Perspective
| Criteria | HSAs | HRAs |
|---|---|---|
| Cash Flow | | |
| Health Plan Benefit Design Flexibility | | |
| Potential to use funds for Unqualified Expenses | | |
| Portability | | |
| Ability to Limit Eligible Medical Expenses | | |
| Tax Benefits | | |
| Ability to Share Funding Burden with Employees | | |
| Ability to Limit Fund Rollover | |
Employee Perspective
| Criteria | HSAs | HRAs |
|---|---|---|
| Health Plan Benefit Design Flexibility | | |
| Potential to use funds for Unqualified Expenses | | |
| Portability | | |
| Qualified Medical Expense not Limited by Employer | | |
| Tax Benefits | | |
| Employer required to Contribute to Account | | |
| No restrictions on Fund Rollover | |
By offering greater control, HRAs have significant advantages over HSAs for Employers. Conversely, fewer employer restrictions around HSAs make them more desirable than HRAs from the Employees’ standpoint.
HSA’s may be a good choice for Employers where the following are all important:
- Providing a tax shelter for a number of high wage earners
- Providing employees flexibility to use tax free funds to pay for the very broad list of qualified medical expenses
- Providing employees with ownership of the Personal Health Care Account with complete portability
It is important to note that both can be effective tools that can empower consumers to be more actively involved in their health care decisions!