Health Savings Accounts

HSA Overview

The Health Savings Account (HSA) is a tax-advantaged interest bearing checking account. The HSA money can be used to help pay the cost of out-of-pocket medical and prescription drug expenses or be used for long term investment purposes.

Details

You may make contributions to your HSA account up to the IRS annual maximum. The money in your HSA account can be used towards any qualified medical expense. Qualified medical expenses are expenses that generally qualify for the medical, dental, vision, and orthodontia deductions defined by the IRS. Once you satisfy your medical plan deductible, you pay your coinsurance for medical expenses for the rest of the calendar year. You also only pay the prescription copays for the rest of the calendar year.

If I Don’t Use It, Will I Lose It?

HSA money is your money, always. The money in your account rolls over from year to year. You won’t lose your unused balance at the end of the year like you would with a FSA. Your savings and earnings are always yours. It’s yours to keep.

Interest Rates For Your PayFlex HSA

One of the benefits of your Health Savings Account (HSA) is that it earns interest, tax-free. In early 2017, your PayFlex HSA interest rate was 0.25%. Effective March 1, 2017, your HSA changed to tiered interest rates. This means your rate depends on your HSA balance. The more money you save in your HSA, the higher your interest rate may be. Below are the new rates. For more information, including the tiered interest rate schedule, click here.

Because HSAs are tax-advantaged, the government has established specific rules about participating in and funding an HSA. Our plan guidelines also govern the method and timing of the contributions that you can make to your HSA. A partial listing of some of the important HSA rules are below:

Rule #1

The HSA medical plan has an aggregate family deductible and family out-of-pocket maximum. This means that if you cover your dependents, you must pay the total family deductible before the plan begins to share costs with you. You must also meet the total family out-of-pocket maximum before the plan pays 100% of the usual, customary and reasonable charges for covered services. Funds deferred into the HSA through biweekly payroll deductions can be used for these costs.

Rule #2

There are specific rules about using or opening an HSA if you or your dependents are currently entitled to or enrolled in Medicare. Please visit the IRS website for more information.

Rule #3

You may make pre-tax contributions to your HSA through payroll deductions. However, the maximum amount of your HSA contributions cannot exceed $3,500 for single coverage and $7,000 for family coverage in 2019. The minimum contribution to your HSA in 2019 is $120 in the plan year.

Rule #4

In a California, Alabama and New Jersey, state income taxes will apply to your HSA contributions. Although your own HSA contributions will not be subject to federal income taxes, in these states you will still be responsible for state income taxes on the money deposited into your HSA.

2019 HSA Contribution Limits

In addition to the Dermalogica contribution, you may make additional contributions to your HSA account up to the IRS annual maximum. For 2019, the maximum amount that you can contribute to your HSA is as follows:

Maximum Contribution – Under age 55

  • Single Coverage
    $3,500
  • Family Coverage
    $7,000

Maximum Contribution – Over age 55

  • Single Coverage
    $4,500
  • Family Coverage
    $8,000

Enrollment Information

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