What is HRA insurance? Well, spoiler alert: it’s not actually insurance. HRA stands for Health Reimbursement Arrangement, and refers to a legal arrangement between an employer and their employees to reimburse for medical expenses and/or insurance premiums on a tax-free basis. Under this arrangement, employees purchase their own health insurance on the open market and then submit claims to their employer to get reimbursed for the cost of their premium and if allowed, all qualified medical expenses. Let’s check out how it works.