Health Savings Account
Health Savings Account (HSA)
If you enroll in the High Deductible Health Plan (HDHP) you will be automatically be enrolled in a Health Savings Account (HSA), managed by Discovery Benefits. The University has historically made an annual contribution to the HSA. Please review your Benefits Guide for information related to the contribution amounts and this year’s annual limits.You may also make a tax-deferred contribution up to the IRS maximum limit. If you are 55 or older in, you are allowed an additional catch-up contribution.
You may use this account to pay for you and your dependents qualified expenses for medical care (copayments and deductibles), as well as other qualified expenses (dental expenses, Medicare premiums, and long term care insurance). Any unused funds roll over each year, so you may also use these funds to pay for qualified expenses in future years, even after retirement.
You own the funds in your account even if you change employers or health plans. You may invest in select mutual funds when your balance is above $1,000.
Your HSA is a “triple-net” tax savings benefits. This means your contributions are tax-deductible, so they reduce your federal income taxes owed. Assets in your HSA account typically grow tax-free, and when you withdraw the funds to pay for qualified medical expenses you are not taxed on them.
If you choose to participate in the HSA, you must be aware of the following:
- You (or any one covered on the plan) cannot be enrolled in any other health plan.
- You cannot participate in the University’s or a spouse’s FSA plan, or have a balance remaining in your previous year’s FSA plan that you are carrying forward.
- The University’s contribution to the HSA plan counts towards the IRS annual limit.
- If you are enrolled in Medicare Part A, you may enroll in the high deductible health plan but are not eligible to contribute, or accept the University’s contributions to the HSA account.
- If you delay enrolling in Medicare Part A to participate in the HSA you must stop contributing to your HSA at least six months before you enroll in Medicare.
- The University may or may not contribute to the HSA in future years.
A list of qualified out-of-pocket expenses for the HSA can be found on the Discovery Benefits website under Employees, Eligible Expenses.
For more information please visit the Discovery Benefits website or call them at 866-451-3399.