What is an HRA and how does it work in Pennsylvania?

A Health Reimbursement Arrangement (HRA) allows Pennsylvania employers to give their employees a fixed monthly allowance of tax-free money. Employees then use this allowance to purchase their own individual health insurance on the local market (such as Pennie) and get reimbursed for qualifying medical expenses.

How does an ICHRA integrate with the Pennie marketplace?

Pennie is Pennsylvania's official state-based health insurance exchange. When a PA employer offers an ICHRA, it triggers a Special Enrollment Period. Employees can then log onto Pennie, shop for an individual plan that meets their unique medical needs, and use their employer's ICHRA allowance to cover the premium costs.

Is an ICHRA or QSEHRA better for a Pennsylvania small business?

For PA small businesses with fewer than 50 employees, a QSEHRA is a great, simple entry point into health benefits. However, if a small business wants to offer different reimbursement amounts to different employee groups (like management vs. staff, or full-time vs. part-time), or if they want to contribute more than the annual QSEHRA limits, an ICHRA is the better choice.

Are HRA reimbursements tax-free in Pennsylvania?

Yes. When structured and administered correctly (which is what Take Command handles), HRA reimbursements are tax-free for the employee (free from payroll and income taxes) and fully tax-deductible for the Pennsylvania employer.

Can Pennsylvania employees keep their doctor if they switch to an HRA?

Yes, and this is a major benefit of HRAs. Because employees choose their own individual health plan on Pennie or the open market, they can specifically filter and select a plan that includes their preferred local Pennsylvania doctors, hospitals, and prescription networks.

Pennsylvania HRAs

Get the best health insurance in Pennsylvania for your employees

From Steel Valley to Philly, affordable health insurance in PA starts with a Take Command HRA

Get affordable health insurance in PA

Avoid expensive PA group plans

Private health insurance in Pennsylvania is an expensive option that forces employers to choose one health benefits plan for all employees.

Set your own budget

With a Take Command HRA, employers determine a budget, and employees can use our platform to buy any plan they choose from our shopping site or the Pennsylvania health insurance marketplace.

Save money with an HRA

The cost difference makes a Take Command HRA more affordable than small group health insurance for many counties in the state of Pennsylvania.

Pennsylvania map with Harrisburg, Philadelphia, Pittsburgh, Scranton, Bethlehem, and Lancaster are shown.

A Take Command HRA is less expensive than small group health insurance in most of Pennsylvania

These prices are 2025 average rates for a 50-year-old on a bronze plan. All Pennsylvania counties qualify for an HRA. See example counties below.

Wayne County

Small group insurance: $629
Individual health plan: $489

Clearfield County

Small group insurance: $598
Individual health plan: $485

Montgomery County

Small group insurance: $500
Individual health plan: $349

Look at health plan costs for your county

What is an HRA?

A Health Reimbursement Arrangement (HRA) is a tax-advantaged health benefits solution where employers give a monthly allowance to employees for qualified medical expenses and insurance premiums. The employer sets the budget, and the employees buy healthcare plans from the ACA or state marketplace.

Pennie: Pennsylvania’s health insurance marketplace

When an employer has an HRA, employees select their health insurance plan from Pennie, Pennsylvania’s health insurance marketplace. Pennie offers more than 400 health plans to choose from, making it easy for employees to find the plan that is perfect for them and their family. Take Command’s HRA platform makes it easy for employees to buy any plan they choose.

Pennsylvania small businesses and home health businesses

PA small business health insurance

Small businesses aren’t required to provide health insurance to employees, but it can help recruit and keep great talent. If you own a small business in Pennsylvania, a Take Command HRA could be a great fit.

PA home health business insurance

Pennsylvania home health businesses have a lot to gain from a Take Command HRA. Employers get to determine the benefits budget and employees get to choose their plan from Pennie, making it a win-win.

Pennsylvania health insurance brokers (and navigators)

If you’re a health insurance broker or navigator with clients in Pennsylvania, you could be providing them significant savings with a Take Command HRA.

Explore ICHRA for brokers

FAQs if you’re a Pennsylvania employer considering an HRA

Why is Pennsylvania a strong market for an ICHRA?

Pennsylvania, particularly in major hubs like Philadelphia and Pittsburgh, has one of the most stable and competitive individual health insurance markets in the country. With an average rate increase request of only 2% in recent years, the market is significantly more predictable than the small group market. Pennsylvania workers also have access to more than 400 health plans, giving them a lot of choice.

How much are Pennsylvania employers typically contributing to an HRA allowance for their employees?

While you have the freedom to set your own budget, the 2026 average reimbursement in Pennsylvania is $452 per month.

For context, a Bronze plan for an individual averages around $250.66, meaning a typical HRA contribution covers 180% of the base premium.
Mid-sized companies (50–300 employees) tend to contribute slightly more, averaging $513 per month.

Which health insurance carriers are available for my employees?

Pennsylvania has a robust selection of carriers on its state exchange (Pennie) and the Pittsburgh area and Allegheny county are particularly popular for ICHRA. Major options include:

Ambetter
Capital Blue Cross
Geisinger Health Plan
Highmark BlueCross BlueShield (Extremely popular in Pittsburgh/Western PA)
Independence Blue Cross (Dominant in Philadelphia/Southeastern PA)
Oscar
UPMC Health Plan

Is there a specific state exchange my employees should use?

Yes. Pennsylvania residents shop for their individual health plans through Pennie, the state's official health insurance marketplace. Plans purchased through Pennie are ACA-compliant and qualify for reimbursement through an ICHRA or QSEHRA.

Can HRA funds be used for more than just premiums?

Yes, and the employer decides. If your plan does allow it, any funds remaining after the premium is paid can be used to reimburse other eligible medical expenses, such as doctor copays, prescriptions, and dental or vision costs. In Pennsylvania, because individual premiums are relatively low, many employees end up with extra HRA dollars to cover these out-of-pocket costs.

Can my business offer an HRA even if we have over 50 employees?

Yes. While the QSEHRA is limited to businesses with fewer than 50 employees, ICHRA is available to companies of any size. This makes it an attractive option for Pennsylvania's mid-market companies that want to control their healthcare spend without the administrative burden of a group plan.

What industries in Pennsylvania are most commonly using HRAs?

While HRAs are used across all sectors, they are trending highly among Pennsylvania non-profits, associations, and churches, as well as businesses in tech, healthcare services, and the hospitality industry in Philadelphia and Pittsburgh.

How does an HRA compare to a traditional group plan in PA?

Traditional group plans in Pennsylvania typically only cover about 70% of the premium, with the rest deducted from the employee's paycheck. In contrast, many Pennsylvania ICHRAs cover 148% to 180% of the base plan cost, resulting in $0 monthly premiums for the employee (and potentially funds to use for additional qualified medical expenses) while giving the employer fixed, predictable costs.

Affordable health insurance for PA’s top industries: healthcare, manufacturing, and transportation

Manufacturing

High healthcare claims are often associated with the physical demand of manufacturing jobs. ICHRA offers meaningful benefits at a reasonable cost.

HRAs for PA manufacturers

Healthcare

Staff burnout and rising operational costs make it hard to run a healthcare practice. Take Command takes care of your budget and your clinicians.

HRAs for PA healthcare organizations

large-modern-truck-winding-road-through-green-forest-freight-logistics

Transportation

In the last decade, the transportation turnover rate was 94%, but HRAs are here to help employers recruit and retain great employees.

HRAs for PA trucking companies

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Contact Take Command to learn about Pennsylvania HRAs

We’re here to help and can answer questions about health insurance quotes for your county.