What is a Health Savings Account (HSA), paired with a High Deductible Health Plan?

A Health Savings Account is an account that allows you to accumulate funds deposited by RCPS on your behalf, as well as your own pre-tax contributions, to cover healthcare expenses toward your deductible.  You must be enrolled in UnitedHealthcare’s High Deductible Health Plan (HDHP).

How to open a Health Savings Account, HSA

• If you are a new hire or if you choose the HDHP with HSA due to a Qualifying Event (QE), please establish an HSA bank account as soon as possible, but no later than within 31 days of your date of hire or QE. 

   

• Please go to the Optum Bank website:  http://www.optumbank.com/

1. Select click on “Open An HSA” on the top bar.  Click “Next”.
2. Enter your demographic information.
3. When asked for "Medical Information....Group number or financial advisor number, enter our group number: 717709.
4. Effective date: >New Hire Effective date: First of the month following date of hire>Qualifying Event Effective date: Based on situation
5. You will receive a letter from Optum Bank with your card or a letter requesting additional information from you if needed. If asked for additional information, please respond to Optum as soon as possible.

HSA advantages

• If you wish to contribute additional money to your HSA account pre-tax, you must complete a new application each year and submit it to Payroll. Go to the RCPS Intranet website, Human Resources Intranet page, "Forms - Benefits” link, and print an HSA contribution form.  Complete and submit this form to payroll. You can change the per pay period contribution to your account anytime throughout the year.

• You must not exceed the IRS maximum contribution each year which includes both employee and employer contributions made on your behalf.  The 2023 IRS maximum for an individual is $3,850 and $7,750 for family. HSA catch up (for age 55 and older) $1,000.

• Out-of-Pocket Costs Reduced: You can use the money in your HSA to pay for eligible medical and prescription expenses and satisfy your plan’s annual deductible.

• Account Portability:  Unused account dollars are yours to keep even if you retire or leave the company.
• Healthcare dollars can grow over time:  You can also invest your HSA dollars in select funds.
• HSA dollars can be used for future eligible expenses such as medical, dental or vision expenses.

HSA Eligible expenses

The products and services listed below are examples of eligible expenses for payment under your HSA, to the extent that such services are not covered by your medical, vision and dental insurance plans. This list is not all-inclusive; additional expenses may qualify, and the items listed below are subject to change in accordance with IRS regulations. Please refer to IRS Publication 502 to verify that your expense is eligible.

HSA tax provisions and eligibility requirements

• Contributions to your HSA account are made pre-tax and withdrawals from your account for eligible medical expenses are tax free.
• Earnings on the account are not taxed and there is no lifetime maximum accumulation of your HSA account.
• Withdrawals for reasons other than eligible medical expenses taken before age 65 are subject to additional 20% penalty but there is no distribution required at age 70 ½.
• HSA account holder must not be covered by any other health plan (i.e. Medicare, Medicaid, Tricare, Group, and Individual coverage unless the coverage is a High Deductible Health Plan).
• Cannot be covered by a spousal medical FSA and cannot be claimed as a dependent on another person’s tax return.

Limited Purpose Health Flexible Spending Account (FSA)

• You may only enroll in a Limited Purpose Health FSA. With the Limited Purpose Health (FSA), only dental and vision expenses are eligible for reimbursement; medical expenses are not eligible for reimbursement.