Page 10 - Adreima Enrollment Guide
P. 10
Annual Enrollment
What is a Health Savings Account (HSA)?
When an team member participates in a qualiied CDHP (and is
not covered by another non-CDHP medical plan), team members
are eligible to participate in a Health Savings Account (HSA). An
HSA allows team members to pay for qualiied medical expenses of
a CDHP with pre-tax dollars, thus reducing taxable income. Team
members can make contributions to the account up to the allowed
maximum contribution limits. The IRS contribution limits for 2016
are $3,350 for individuals and $6,650 for families. Individuals age
55 and older may contribute an additional $1,000 to the HSA under
the “catch-up” provision. These funds can be withdrawn at any time
to cover qualiied medical expenses as deined by the IRS, such as
deductibles, medical services, pharmacy charges or post retirement
medical expenses for example. Adreima will be contributing
money to your HSA account (see page 17). Please remember
to factor this into your total if you plan on maxing out
contributions this year.
Unlike a traditional Flexible Spending Account (FSA), there is no
use-it-or-lose-it rule with an HSA. Contributions made to the account
will automatically roll over year after year. There are no vesting
requirements or forfeiture provisions. The banking institution sets an
investment threshold on the HSA. Once this investment threshold
is reached, the money in the account may be invested in one of the
institution’s investment options, typically mutual funds. Earnings
on these investments help the account to grow over time and may
be used to help pay for post-retirement medical expenses, such as
COBRA premiums or long-term-care insurance.
Note: when you participate in an HSA, you are not eligible for
the traditional FSA. If you are currently enrolled in an FSA, you
cannot contribute to an HSA until you are no longer enrolled in
an FSA.
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What is a Health Savings Account (HSA)?
When an team member participates in a qualiied CDHP (and is
not covered by another non-CDHP medical plan), team members
are eligible to participate in a Health Savings Account (HSA). An
HSA allows team members to pay for qualiied medical expenses of
a CDHP with pre-tax dollars, thus reducing taxable income. Team
members can make contributions to the account up to the allowed
maximum contribution limits. The IRS contribution limits for 2016
are $3,350 for individuals and $6,650 for families. Individuals age
55 and older may contribute an additional $1,000 to the HSA under
the “catch-up” provision. These funds can be withdrawn at any time
to cover qualiied medical expenses as deined by the IRS, such as
deductibles, medical services, pharmacy charges or post retirement
medical expenses for example. Adreima will be contributing
money to your HSA account (see page 17). Please remember
to factor this into your total if you plan on maxing out
contributions this year.
Unlike a traditional Flexible Spending Account (FSA), there is no
use-it-or-lose-it rule with an HSA. Contributions made to the account
will automatically roll over year after year. There are no vesting
requirements or forfeiture provisions. The banking institution sets an
investment threshold on the HSA. Once this investment threshold
is reached, the money in the account may be invested in one of the
institution’s investment options, typically mutual funds. Earnings
on these investments help the account to grow over time and may
be used to help pay for post-retirement medical expenses, such as
COBRA premiums or long-term-care insurance.
Note: when you participate in an HSA, you are not eligible for
the traditional FSA. If you are currently enrolled in an FSA, you
cannot contribute to an HSA until you are no longer enrolled in
an FSA.
10
