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    • Retirement reimbursement account (RRA)

    An HRA for retirees

     

    An Aetna Health Fund® Retirement Reimbursement Arrangement is a great way for companies to play a part in the well-being of their employees after they retire. By providing employer-funded support for health care expenses, an RRA reduces unexpected health care costs and helps retirees better budget their finances. Here's how an RRA works:

     

    • Employers set up and pay into the fund.
    • Retired employees use the fund to get reimbursed for qualified health care costs they have paid. These may include premiums and other out-of-pocket costs that have been determined by the employer.
    • Any unused balance in the RRA rolls over to the next year.
     

    Frequently asked questions about an RRA

    Question

    Answer

    Who is eligible?

    All employees as designated by employer.

    Who can contribute?

    Employer only

    Does the balance carry over?

    Yes

    Can rollover contributions from another account be made to this account?

    Yes, members can roll over funds from an HRA.

    Is the fund or account portable?

    No

    Are there interest or investment earnings?

    No

    What are the tax advantages?

    Employers may deduct reimbursed employee medical expenses as a business expense; reimbursements are excludable from the employee's gross income.

    Are the contributions taxable income to the employee?

    No

    In addition, contributions are not subject to FICA or FUTA taxes.

    Are the distributions / reimbursements taxable income to the employee?

    No

    Question

    Who is eligible?

    Answer

    All employees as designated by employer.

    Question

    Who can contribute?

    Answer

    Employer only

    Question

    Does the balance carry over?

    Answer

    Yes

    Question

    Can rollover contributions from another account be made to this account?

    Answer

    Yes, members can roll over funds from an HRA.

    Question

    Is the fund or account portable?

    Answer

    No

    Question

    Are there interest or investment earnings?

    Answer

    No

    Question

    What are the tax advantages?

    Answer

    Employers may deduct reimbursed employee medical expenses as a business expense; reimbursements are excludable from the employee's gross income.

    Question

    Are the contributions taxable income to the employee?

    Answer

    No

    In addition, contributions are not subject to FICA or FUTA taxes.

    Question

    Are the distributions / reimbursements taxable income to the employee?

    Answer

    No

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    Legal notices

    Aetna is the brand name used for products and services provided by one or more of the Aetna group of companies, including Aetna Life Insurance Company and its affiliates (Aetna).

    Health benefits and health insurance plans contain exclusions and limitations.