Which term describes an employer-funded account that reimburses employees for medical expenses and is not funded by employee contributions?

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Multiple Choice

Which term describes an employer-funded account that reimburses employees for medical expenses and is not funded by employee contributions?

Focus on who funds and owns the account. An employer-funded account that reimburses employees for medical expenses and is not funded by employee contributions is a Health Reimbursement Account. The key idea is that the employer provides the funds and the employee is reimbursed for eligible medical costs, with no required employee contributions. This distinguishes it from other accounts: a Health Savings Account is owned by the employee and can be funded by both employee and employer, and is tied to a high-deductible plan; a Flexible Spending Account is primarily funded by pre-tax employee contributions (though some employers may contribute); and an Exclusive Provider Organization is a type of health plan, not a reimbursement account.

Focus on who funds and owns the account. An employer-funded account that reimburses employees for medical expenses and is not funded by employee contributions is a Health Reimbursement Account. The key idea is that the employer provides the funds and the employee is reimbursed for eligible medical costs, with no required employee contributions. This distinguishes it from other accounts: a Health Savings Account is owned by the employee and can be funded by both employee and employer, and is tied to a high-deductible plan; a Flexible Spending Account is primarily funded by pre-tax employee contributions (though some employers may contribute); and an Exclusive Provider Organization is a type of health plan, not a reimbursement account.

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