If your employee has a claim that is only partially reimbursed, in short, it means that they have used up their allowance year-to-date.
Let's break it down:
- The HRA allowance is an annual benefit which is unlocked on a monthly basis and prorated for the number of months your employee has been eligible.
- When the total reimbursement claims YTD are more than the total available allowance YTD, it will leave a portion of the claims "unreimbursed."
- Our system will apply each month’s new allowance to the oldest claim first.
- The “Reimbursed” column represents how much of a claim has been reported to you on your Reimbursement Statement. We assume you reimburse your employees after you have your statement run each month.
- The sum of the "Reimbursed" column is equal to your employee's prorated allowance YTD, or at least as of the date of your last Reimbursement Statement.
- We will continue to track your employee's unreimbursed claims over time and continue to apply each month's allowance to them until they are paid in full.
Here are a few examples of times when you may see this happen.
Example #1 - Employee's premium is larger than the monthly allowance
For this example, let's use the following:
- You offer an HRA allowance or $400 per month
- Your employee's monthly insurance premium is $600 per month
- Employee sets up their recurring premium claim for $600 per month
In this case, our system will automatically create a $600 claim on your employee's behalf each month. So in January, it's easy, right? You know January's $400 allowance is applied to the $600 claim for January.
But remember, each new allowance will be applied to the oldest claim first. That means that the February $400 allowance will first be applied to the remaining balance on the January premium claim until it's reimbursed in full.
This doesn't mean that in January, you reimburse them $600, and in February you reimburse them $200. It just means that year-to-date as of February, you have reimbursed your employee will reimburse $800 total, and the $800 was applied to your employee's claims in order of their submission.
Example #2 - Your employee submits a large medical bill for reimbursement
Let's take a look at what happens an employee submits a medical bill that is larger than the monthly HRA allowance.
For this example:
- You are offering an allowance or $400 per month
- Your HRA went into effect January 1st
In January, your employee goes to the ER and has a $1,000 bill that they submit for reimbursement. As of January, he or she only has $400 available in reimbursement allowance. We will automatically apply the January $400 allowance to this claim, and your January Reimbursement Statement will show that your employee is owed $400. But for the rest of the month after your Reimbursement Statement runs, you'll see that it shows only $400 has been reimbursed.
Then in February, another $400 of HRA allowance will get unlocked. Even if your employee has submitted a new claim, the February allowance of $400 will get applied to the older claim first. So now January & February's $400 allowances are applied to the $1,000 hospital bill. In March the remaining balance of the ER visit will be marked as reimbursed ($200) and the additional medical expense of $132.75 that was approved previously will now be reimbursed with the available funds.