"HIGH DEDUCTIBLE HEALTH PLAN HDHP WITH HEALTH SAVINGS ACCOUNT HSA"
HIGH DEDUCTIBLE HEALTH PLAN (HDHP) WITH HEALTH SAVINGS ACCOUNT (HSA) the Department of Veterans Affairs during the HOW THE HIGH-DEDUCTIBLE MEDICAL preceding three months. PLAN WORKS • You cannot be claimed as a dependent on Hamline offers a high-deductible medical plan through someone else’s tax return. HealthPartners, paired with a health savings account (HSA) through US Bank. The HSA can only be You can use your HSA money to: offered with a health plan that meets the Federal requirements of a qualified high deductible medical • Pay for qualified medical, dental, vision and plan. certain over-the-counter drug expenses, as defined in IRS Section 502 (available online at The HealthPartners high-deductible plan option uses www.irs.gov/pub/irs-pdf/p502.pdf ). the same Open Access network of health providers used by the other two medical plan options (the Basic • Pay for COBRA, Medicare or long-term care and Basic Plus plans). When you enroll in the high- insurance premiums, as well as for medical deductible plan, you are responsible for all costs premiums during periods of unemployment. associated with non-preventive care up to the annual • Supplement your income, but money withdrawn deductible amount, including prescription drug costs. and used towards something other than a qualified For in-network benefits the annual deductible is $2200 medical expense is taxable and, if you’re under per individual with a maximum of $4400 for family age 65, subject to a 10% penalty. coverage. The plan covers in-network preventive care at 100%, so these services are not subject to the • Build a nest egg by saving your HSA dollars for deductible. The annual deductible is also the annual the future. Your HSA balance rolls over from out-of-pocket maximum for the plan, so after your year to year, and can be invested so that it will costs reach the deductible amount, the plan pays for grow over time, giving you more dollars to spend 100% of covered expenses for the remainder of the on future health care expenses. calendar year. CONTRIBUTIONS HOW THE HSA WORKS You can contribute to an HSA pre-tax through payroll deduction. Your maximum HSA contribution depends Enrollment in the high-deductible plan qualifies you to on the level of medical coverage you elect. For 2009 enroll in a health savings account, commonly referred the maximum is $3000 for single coverage and $5950 to as an “HSA”. You can make tax-free contributions for family coverage. If you’re age 55 or older in 2009 to the HSA, similar to an individual retirement you may make an additional “catch-up” contribution account, except that the balance can be withdrawn tax- of $1000 in 2009. free to pay for eligible current and future health care expenses. Unused funds roll over from year to year Employer contributions count towards the annual (there is no “use-it-or-lose-it” provision) and the maximum. Hamline employees who choose single account balance remains with you if you leave the coverage under the high-deductible plan organization or retire. automatically receive a $50/month HSA contribution ($600 annualized) from Hamline, which means the You’re eligible to contribute money to an HSA if you employee is able to contribute up to an additional meet all of the following requirements: $2400 to the HAS (or $3400 if age 55 or older in 2009) to reach the annual maximum. (Employees who • You’re covered under a high deductible health choose single + one or family coverage receive the plan (HDHP), and you’re not covered by any employer contribution in the form of a reduced other health plan that is not an HDHP. monthly premium, and have the option to contribute • You’re not currently enrolled in Medicare or premium savings to the HSA account, as an employee TRICARE. contribution.) • You have not received medical benefits through HDHP/HSA Summary Sheet Page 1 of 2 HIGH-DEDUCTIBLE MEDICAL PLAN / HSA tax dependents, or a spouse. Partners are eligible to COVERAGE (continued) open their own, separate HSA account at the financial institution of their choice, and fund it to the maximum allowed, which is driven by the level of coverage. HSA contributions are not subject to the same “Change in Family Status” rules as the flex spending US BANK – ACCOUNT ADMINISTRATION account, so you can change your HSA contribution Hamline has chosen US Bank to handle its HSA amount during the year, on a monthly basis. Complete administration services. After you elect to contribute a new benefit Election/Waiver form and return to the to the HSA, an account will be opened for you, and Human Resources department. contributions made through payroll deduction. Contributions will be deposited to your account at the YOUR RESPONSIBILITIES end of each month. US Bank will send you a As the HSA accountholder, you are responsible for Welcome Kit that contains complete information ensuring that distributions are used for qualified about how to activate and use your HSA. To activate medical expenses. Records of medical expenses the account, you’ll need to sign an account agreement, should be maintained as evidence that distributions either electronically or by returning a paper form to have been made for these purposes. Qualified medical US Bank. expenses may only be reimbursed, tax-free, if the Account services include: expenses are incurred after the date your HSA account was established. • Use of debit card to pay for qualified medical expenses, where the money comes directly out of You’re also responsible for ensuring that your annual your account when used; second card available HSA contributions do not exceed IRS limits. for no additional fee; • Use of checks to pay for qualified medical TAX REPORTING expenses; first box of checks free; Tax reporting is required for the HSA. IRS form 8889 • Online access to view balance, transaction history must be completed with your tax return each year to and other account details; report total deposits and withdrawals from your account (you do not have to itemize to complete this • Electronic monthly statements; paper statements form). available for a fee; • Year-end tax reporting information mailed to your COORDINATING WITH THE home; FLEX SPENDING ACCOUNT • Customer Service support available Monday Be aware that if you enroll for the high-deductible through Friday, 8am to 7pm Central Time. medical plan, your use of the flex spending account Contact the Health Savings Solution Center at option will be limited to dental and vision expenses. 877-HSA-6789 (877-472-6789). Although you can submit vision and dental expenses to your HSA for reimbursement, you may choose to If your average monthly balance is less than $2500, a maximize your tax benefits by using the flex account monthly maintenance fee of $3.25 will be charged to for vision and dental. If you cover your spouse under your account. Other fees may apply, such as overdraft Hamline’s high-deductible plan, they would not be or account termination fees. The balance of your HSA eligible to enroll in their employer’s medical flex will initially be invested in an FDIC-insured, interest spending account while covered by the high- bearing deposit account with US Bank. Interest rates: deductible plan, unless their employer offers a $0-1999.99 0.25% “limited use flex plan” for dental and vision only. $2000-$4999.99 0.60% $5000-$14,999 1.00% DOMESTIC PARTNER COVERAGE $15,000+ 3.50% If you cover a domestic partner under the high- When your account balance exceeds $2500, you will deductible medical plan, just remember that the HSA also have the option to invest dollars over that amount (a separate entity from the medical plan) is a tax into the mutual fund options, with no additional fee. advantaged account. This means that under federal rules it can only be used for family members who are HDHP/HSA Summary Sheet Page 2 of 2