Can An HRA Be Used To Pay Health Insurance Premiums? 
Yes a Health Reimbursement Arrangements can fund health insurance premiums , such a arrangement is usually referred to as a PRA -LRB- Premium Reimbursement Arrangement -RRB- . Although such arrangements have become unfavorable due to healthcare reform legislature due to two main reasons 1 . If a employer wants to drop group coverage and have employees purchase individual policies , this can only be offered after-tax -LRB- RR 61-146 -RRB- . This means that such arrangements have lost their tax-advantaged status , which in effect takes away much of the benefit to the employer .2 . A group health plan , including an HRA , used to purchase coverage on the individual market is not considered integrated with that individual market coverage for purposes of the annual dollar limit prohibition . Meaning that even if a HRA were to cover 100 % of employee premiums for individual coverage the employer would still be viewed as not offering MEC -LRB- Minimum Essential Coverage -RRB- . 