To establish a Health Reimbursement Arrangement, what is required?

A Health Reimbursement Arrangement (HRA) is a type of employer-funded account that helps employees pay for qualified medical expenses. One of the fundamental characteristics of an HRA is that it must be established by the employer. This means that the employer creates the arrangement, sets the terms of the plan, and contributes funds to the HRA.

Since the employer is responsible for initiating and managing the HRA, employees cannot establish an HRA on their own. The employer determines the contributions, eligible expenses, and any conditions related to the reimbursement process. This is why the option stating that an HRA must be established by the employer is the correct answer.

Other potential options, while they could relate to aspects of health plans or arrangements, don't directly address the fundamental requirement for establishing an HRA as clearly as the need for the employer's involvement does.