I have an MRA with bluecross/bluesheild and each year they give me back money but they told us it was tax free. is that true?

[DoninGA]

I think you meant an HRA, Health Reimbursement Arrangement.  

You do not report the HRA funds you receive on a tax return since those are a reimbursement for medical expenses you already paid with out of pocket funds.  You cannot enter those expenses as a deduction on tax return since you were reimbursed.

[Opus 17]

If you have a Health Reimbursement Arrangement (HRA) it can only be funded by your employer, and you can never receive money back, except to reimburse you for medical expenses you prove with receipts.  Unspent funds can either roll over to the next year, or are returned to the employer, depending on how the employer chose to set it up.  It's a tax-free employee benefit, as long as the funds are only used for qualifying medical expenses. 

If this is what we are talking about, it is not reported on your tax return, except that you can't list medical expenses as itemized deductions if they were reimbursed by the HRA.  

If you are getting money as a health incentive that is added to the HRA, that's also not taxable, as long as you can only withdraw money from the HRA to reimburse you for qualifying medical expenses.  

If you receive a check of free money (such as for participating in a weight loss program, or a stop smoking program), that is a taxable employee benefit and the value should be included in your W-2 by your employer.