Health Savings Acounts :: Aegis Admin - Health Insurance Benefits and Claims Administration.

Health Savings Accounts - FAQ's

Find the answers to the most common questions about HSA's. For more information, please contact us !

What is an HSA account?

What is an HRA account?

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Health Savings Account (HSA)

An HSA is an account you use to set aside funds on a pre-tax or tax-deductible basis to pay for routine healthcare - such as office visits, prescription drugs and lab tests. The money you put into your HSA will reduce your income taxes similar to the money you save in a 401(k) plan. An HSA can be established at a bank, insurance company or third party administrator. If your HSA is part of your employee benefits program, your employer may also make contributions. There are annual limits on the amount of money you can contribute to your HSA. Whatever you don't spend from your HSA rolls over year-to-year for future healthcare needs. And if you retire or leave the company for any reason, you can take the balance in your HSA with you. Funds deposited into the HSA can be conveniently accessed through the use of a debit card or check.

Health Savings Accounts are available to members who do not have Medicare or another health plan. The amount of the "premium pass through" is based on whether you have a Self Only or Self and Family enrollment. You have the option to make tax-free contributions to your account, provided the total contributions do not exceed the limits established by law, which are typically not more than the plan deductible. If you are over 55, you can make an additional "catch up" contribution. You can use funds in your account to help pay your health plan deductible. However, if you enroll in a HDHP with a HSA, you are not eligible to participate in a Health Care Flexible Spending account.

Features of an HSA include:

Tax-deductible deposits you make to the HSA.
Tax-deferred interest earned on the account.
Tax-free withdrawals for qualified medical expenses.
Carryover of unused funds and interest from year to year.
Portability; the account is owned by you and is yours to keep - even when you retire.

Health Reimbursement Arrangement (HRA)

For members who are not eligible for an HSA, have Medicare or another non-High Deductible Health Plan, the HDHP will provide and administer a Health Reimbursement Arrangement.

The plan will credit the HRA different amounts depending on whether you have a Self Only or a Self and Family enrollment. You can use funds in your account to help pay your health plan deductible.

Features of an HRA include:

Tax-free withdrawals for qualified medical expenses.
Carryover of unused credits from year to year.
Credits in an HRA do not earn interest.
Credits in the HRA are forfeited if you leave federal employment or switch health insurance plans.

Premium Contribution to HSA/HRA

	Health Savings Account (HSA)	Health Reimbursement Arrangement (HRA)
ELIGIBILITY	You must enroll in a High Deductible Health Plan. No other general medical insurance coverage permitted. You cannot be enrolled in Medicare Part A or Part B.	You must enroll in a High Deductible Health Plan.
FUNDING	The plan deposits a monthly premium pass through into your account.	The plan deposits the credit amount directly into your HRA.
CONTRIBUTIONS	The maximum allowed is a combination of the health plan premium pass through and the member contribution up to the amount of the plan deductible.	Only that portion of the premium specified by the health plan will be contributed. You cannot add your own money to an HRA.
DISTRIBUTIONS	May be used to pay the out-of-pocket medical expenses for yourself, your spouse, or your dependents, or to pay the plan's deductible. See IRS Publication 502 for a complete list of eligible expenses.	May be used to pay the out-of-pocket expenses for qualified medical expenses for individuals covered under the health plan, or to pay the plan's deductible. See IRS Publication 502 for a complete list of eligible expenses.
PORTABLE	Yes, you can take this account with you when you terminate employment or retire.	If you retire and remain in your health plan you may continue to use and accumulate credits in your HRA. If you terminate employment or change health plans, only eligible expenses incurred while covered under that health plan will be eligible for reimbursement, subject to timely filing requirements. Unused credits are forfeited.
ANNUAL ROLLOVER	Yes, funds accumulate without a maximum cap.	Yes, credits accumulate without a maximum cap.

IMPORTANT REMINDER: This is only a summary of the features of the HDHP/HSA or HRA. Refer to the specific Plan brochure for the complete details covering Plan design, operation, and administration as each Plan will have differences.

TAX-SHELTERED ACCOUNTS

Tax-sheltered health spending accounts have been around for years, but became more popular this year because of changes in federal law.

Options to choose one or more of the accounts are expected to show up in more employees' enrollment materials again this fall, for accounts which would begin next year.

Here's a look at the types of tax-sheltered accounts. Some employers offer only one, while others give a choice among types of accounts. Some don't offer any.

Flexible spending account (FSA)
Money contributed by? Employee only.
Rollover year-to-year? No, it's use it or lose it. But new rules allow employers, if they want , to extend the deadline to spend the money by 2 1/2 months.
Carry from job to job? No.
Other rules and limits? Contributions must be designated before the year begins, and are generally deducted from each paycheck.

Health savings account (HSA)
Money contributed by? Employee and/or employer.
Roll over year-to-year? Yes.
Carry from job to job? Yes.
Other rules and limits? Must be linked to a high-deductible health insurance plan. After age 65, can be withdrawn at current tax rate for non-medical expenses.

Health reimbursement arrangement (HRA)
Money contributed by? Employer only.
Rollover year-to-year? Yes.
Can carry from job to job? No.
Other rules and limits? Can be used to pay health insurance premiums and for long-term care as well as for normal medical expenses, such as payments to doctors and hospitals.