Can You Have an HRA and Section 125 HSA? - Exploring the Possibilities

Health savings accounts (HSAs) are gaining popularity as a way to save and pay for healthcare expenses, but there can be confusion around the interaction of HSAs with other healthcare plans such as health reimbursement arrangements (HRAs) and Section 125 plans.

So, can you have an HRA and Section 125 HSA at the same time? The short answer is yes, in some cases, you can have both an HRA and a Section 125 HSA, but it depends on the specific rules and regulations governing each plan.

Here's a breakdown of how HRAs and Section 125 HSAs can work together:

• HRAs are employer-funded plans that reimburse employees for eligible medical expenses tax-free.
• Section 125 plans, also known as cafeteria plans, allow employees to contribute a portion of their pre-tax salary to pay for qualified healthcare expenses.
• While it's possible to have an HRA and a Section 125 HSA simultaneously, there are certain restrictions and considerations that need to be taken into account:
• The HRA cannot be used to reimburse expenses that are also covered by the HSA.
• Employees must be enrolled in a high-deductible health plan (HDHP) to be eligible for an HSA.
• Contributions to the HSA cannot exceed annual limits set by the IRS.

By understanding the guidelines and regulations surrounding HRAs and Section 125 HSAs, employees can effectively leverage both accounts to maximize their healthcare savings and benefits. It's essential to consult with a financial advisor or benefits specialist to ensure compliance with all applicable laws and rules.




Health savings accounts (HSAs) have become a vital tool for many individuals seeking ways to save on healthcare costs. When considering whether you can have both an HRA and a Section 125 HSA, it’s important to recognize the synergy that can exist between them.