Health Savings Account (HSA)

Stretching your dollars

A Health Savings Account (HSA) is a tax-advantaged account which allows you to pay for your eligible out-of-pocket health care costs using pre-tax dollars – meaning you save money.

You’re offered an HSA if you select the Advantage Plan. You can use this account to pay for your health expenses in the current plan year or roll it over into future years.

We want to help you maximize your money. That’s why for 2020 you’ll receive a $600 Startup Contribution to your HSA when you enroll in the Advantage Plan, even if you were enrolled last year! The startup contribution will be prorated based upon your month of enrollment.

Key details

  • You need to meet certain criteria to open an account.
  • You benefit from a triple tax-advantage as your contributions, interest and investment growth, and withdrawals are all tax free.
  • For 2020, you can save up to $3,550 for individual coverage and $7,100 for family coverage.
  • You can change your contributions at any time.
  • There’s no “use it or lose it” rule, meaning any unused funds will rollover each year.
  • Once you’ve saved $1,000 you can start investing your savings.
  • You can use a debit card to pay for eligible expenses.
  • The account belongs to you, meaning the money you save is yours, even if you leave RAI.

Don’t forget to do the math before making your choices. 40% of the households enrolled in the Standard Plan in 2018 could have saved on their medical expenses if they’d enrolled in the Advantage Plan and benefitted from lower monthly premiums and a Startup Contribution into their HSA.

FAQs

How do I contribute into an HSA?

Health Equity administers the HSA. Once you confirm that you meet the eligibility requirements, Health Equity will open your account and you’ll be able to start contributing.

RAI will make a Startup Contribution to give your HSA a boost. You can contribute additional funds through pre-tax payroll deductions or by making tax-deductible contributions directly to Health Equity. You can change your contributions anytime through Alight.

What’s the difference between an HSA and a Health Care FSA?

The main differences between an HSA and an FSA are shown in the table below.

  HEALTH SAVINGS ACCOUNT FLEXIBLE SPENDING ACCOUNT
Who can contribute Employees enrolled in the Advantage Plan as long as HSA eligibility requirements are met. Employees who aren’t enrolled in the Advantage Plan.
What is the maximum that can be contributed during 2020? For Individual Coverage: $3,550
Family Coverage: $7,100
At age 55 you can contribute an additional $1,000 annually.
$2,700
If funds are left at the end of 2020, will they rollover to the next year? Yes No
Can the funds be invested to potentially grow? Yes No
Will the account remain open if you leave the Company? Yes – you own the account. Generally, no.
Am I eligible to contribute to an HSA?

You’re able to contribute to an HSA if you are enrolled in an HSA-eligible health plan like the Advantage Plan and meet other IRS requirements. If you’re unsure if you qualify, talk to a tax advisor or consult IRS Publication 969.

Since the HSA is a tax-advantaged account, there are rules about who can participate. You won’t be eligible if:

  • You’re covered by any other health insurance plan that isn’t an HSA-eligible health plan.
  • You’re enrolled in Medicare (Part A or B) or claimed as a dependent on another person’s tax return.
  • You’re a U.S. resident who resides in Puerto Rico or American Samoa.
  • You’re on active military duty or a veteran who received veteran’s benefits within the last three months.

Tools

Blue Cross Blue Shield (BCBS)
Review your health care expenditure over the last few years
Express Scripts (ESI)
Visit the ESI website to review your prescription drug expenditure over the last couple of years.
Express Scripts Price Comparison
Compare the cost of your prescription drugs under the Advantage and Standard Plans. Remember, once the Advantage Plan deductible is met your cost is the same under each medical plan.
myHealthEquity
Find out more about tax-favored savings
Ayco Financial Coaching
Learn how to maximize your savings
RAIbenefits.com
Evaluate your needs, change your HSA contribution, set saving goals and choose the best plan for you.

Downloads

HSA Basics 2020

Deciding which plan is right for you 2020

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