Health Savings Account
The Maroon Savings Choice medical plan will include a Health Savings Account (HSA) administered by HSA Bank, a division of Webster Bank, an FDIC-insured institution. You can use this account to pay for qualified health expenses, including deductibles, coinsurance, dental, vision, and prescription drug expenses. Since the HSA is a bank account that you own, you will be issued a debit card. As the account holder, you will be responsible for all banking fees such as replacement of a debit card or ordering checks. You can use your debit card or check to directly pay for your eligible out-of-pocket health expenses to providers.
Any unused funds will roll over, allowing you to build tax-free savings for future health care needs, including funds for medical expenses during retirement years. You can also grow your HSA savings through TD Ameritrade and Devenir self-directed investment options (through HSA Bank's internet banking). There is no minimum requirement to begin investing.
Each calendar year, the University will contribute up to $500 to the HSA for those enrolled as individuals or up to $1,000 for those enrolled with a spouse and/or children. Contribution amount is based on coverage start date.
You have the option to contribute additional funds through pre-tax payroll deductions, up to the IRS limit based on your coverage tier through payroll deductions on a pre-tax basis. If you are age 55 or older, you can contribute an additional $1,000 regardless of your coverage tier. You can also contribute by check/money order or transfer/rollover funds directly to HSA Bank.
Important Information to Know
- Your HSA will operate just like a bank account. Once your account is opened, you will be required to maintain the account, including making updates to your address and marital status, directly with HSA Bank.
- Some states (California, Alabama, and New Jersey) will apply state taxes to contributions.
- You are not required to provide proof that an HSA distribution was used exclusively for an eligible out-of-pocket health expense; however, you will want to maintain records showing that payments were for qualified health care expenses in the event of an IRS audit.
- Investment accounts are not bank guaranteed or FDIC insured and are the sole responsibility of the account holder.
- HSA Bank will provide monthly account statements, a year-end status report, and IRS Forms 5498-SA and 1099-SA to report contributions and distributions on your tax returns.
- All participants in a qualified health savings account should designate a beneficiary for their HSA account.
- A beneficiary can be one or more individuals (i.e., spouse, children, relatives, or friends) or organizations, such as a trust or charity.
- By having a designated beneficiary in place at the time of your death, the assets of your HSA can be distributed according to the designation. In the absence of a designation, your beneficiary is your estate.
- If you wish to designate a beneficiary or update your current beneficiary with HSA Bank, simply follow these easy steps, Designating a Beneficiary for Your HSA.
- IRS rules state that participants cannot be covered in any other Traditional Health Plan, Health Care Reimbursement Account (HRA), Health Care Flexible Spending Account (FSA), Tricare, and/or VA benefits.
- You cannot be claimed as a dependent on another person's tax return (excluding your spouse's).
- You cannot be enrolled in Medicare.
- You are responsible for informing HSA Bank if you are not eligible for an HSA.