Use of the Prepaid Benefits Card with Health Reimbursement Accounts (HRAs)

U.S. Treasury and IRS guidelines have paved the way for more rapid adoption of consumer-directed health plan offerings. These new programs maximize member choice, increase member responsibility, make health care costs more visible to the consumer and provide incentives for consumers to make wiser choices in their discretionary health care spending.

A Prepaid Benefits Card can simplify the administration of these new plans for the employer, the health plan administrator and the consumer. The card has the ability to create separate accounts or "purses" for plan features that might have different funding sources or expense categories, such as personal care accounts, prescription drug carve-outs, FSA and QTAs. Employees can use the card as the bridge between the first dollar coverage, deductibles and coinsurance and 100 percent coverage with the activity to track via the Web.

The Prepaid Benefits Card specifically permits employers to take advantage of these favorable IRS rulings and implement the new, consumer-oriented HRAs while offering the employee an easy-to-use method of paying for that portion of health care charges not covered by the plan right at the point of service. It helps to manage the key elements of the plan design right on the card and increases employee awareness and responsibility for health care spending.

For Employees