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Covered California and Obamacare related questions from consumers, employers and agents are answered by Phil Daigle with the best information available at the time. Archived entries may no longer be accurate as the Covered California and Obamacare knowledge-base is evolving quickly. TO REQUEST A PERSONAL RESPONSE INCLUDE EMAIL ADDRESS.

Paying Off the HRA Advance Payment

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Question: My husband works for a mid sized business. They changed health plans a year ago. The premiums are deducted pre tax from his pay. With co-pays and additional bills from doctors the plan is not affordable. The plan promotes “one bill” where the insurance company pays your provider and then bills you. Currently his employer is trying to force employees to payroll deduct for unpaid medical bills. I think we will be forced out of the plan if we refuse. Is this common practice?

Answer: Yes. Your employer can collect what you owe them through payroll deduction. Here’s why you owe the employer that money. The “one bill” plan to which you refer is actually a health reimbursement arrangement (HRA). The HRA works in conjunction with your health insurance coverage. The employer (not the insurance company) pays the employees’ out-of-pocket costs (copays, coinsurance, and other out-of-pocket medical expenses) directly to the providers - doctors, hospitals pharmacies. It’s like an advanced reimbursement. Your employer paid the bill for you, now you owe your employer that money.

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