A guide to. Information to help you use your Health Savings Account with your health plan
|
|
- Franklin Walsh
- 8 years ago
- Views:
Transcription
1 A guide to Information to help you use your Health Savings Account with your health plan
2 Invest in your health with a Health Savings Account hsa Thank you for choosing a Premera Blue Cross Your Future medical plan which works in combination with a Health Savings Account (HSA). Now you can combine your comprehensive medical benefits with an opportunity for more choice and control over your health-care spending. Tax-advantaged health-care funding arrangements combined with our integrated health programs and resources are designed to support better health and help sustain health-care costs. Because you have selected a qualifying high-deductible medical plan, you may be eligible to open an individually-owned Health Savings Account, which allows you to save pre-tax dollars for future qualified medical expenses. This brochure provides general information about Health Savings Accounts. Review this information to help you use this account with your health plan. Top 5 Things to Know 1 The Health Savings Account You are responsible for establishing your Health Savings Account with a qualified HSA administrator. You can use this account to save pre-tax money to pay for qualified medical expenses. 2 Your responsibility You are responsible for your annual deductible and coinsurance. Your HSA funds can be used to pay for these expenses. 4 The HSA medical plan provides the highest level of benefits when you use Premera Blue Cross network health-care providers*. 5 You have access to all of Premera s member benefits including the 24-hour NurseLine at Keep your receipts Save your medical expense receipts with your other annual tax materials for any services reimbursed from your HSA. Consult your tax advisor or visit the IRS Web site, for additional information and requirements. *Please note that out-of-network providers may handle payment for their services at their discretion. Be sure to ask your provider about their fees and payment options before seeking services.
3 Advantages of having a Premera Your Future medical plan The Premera Your Future medical plan is a highdeductible plan that is qualified for use with a Health Savings Account (HSA). It is an ideal choice if you: Want to actively manage your health care Are looking for additional tax-advantaged savings opportunities Want to reduce your tax liability Anticipate minimal medical expenses in the future Who can open a HSA? You can open a HSA if you meet the following criteria:* You are enrolled in a qualified, high-deductible medical plan such as a Premera Blue Cross Your Future plan You are not covered under another medical plan (including your spouse s) You are not enrolled in Medicare You cannot be claimed as a dependent on someone else s tax return. Anticipate medical expenses but want the tax advantages of a HSA Are planning for retirement medical expenses. What is a HSA? A HSA is an individually-owned, fully portable, tax-advantaged account that allows you to save and help pay for current and future medical expenses. Established by you through a qualified HSA administrator, a HSA can provide a triple tax advantage: Contributions are made on a tax-advantaged basis Any unused funds carry over from year to year and grow tax-deferred Need help? Premera Blue Cross offers you fast, responsive customer service. Have your member ID card ready when you call. Our customer service staff is available to help between 8 a.m. and 5 p.m. (PST) weekdays at When used to pay for qualified medical expenses, funds can be withdrawn tax-free. * For more detailed information, refer to IRS Publication 969, Health Savings Accounts and Other Tax-Favored Health Plans, which you can download from the IRS Web site, or order by calling TAX FORM. For tax advice, please talk to your tax advisor. This guide and the information included herein are not intended nor can they be used to avoid penalties relating to federal income taxes. This guide was prepared to promote the products described. Taxpayers who read this guide should seek advice based on the taxpayer s particular circumstances from an independent tax advisor. Premera Blue Cross is not a tax advisor. 2 Customer Service:
4 How does a HSA work? There are three key components involved in using a HSA: 1. Medical coverage Your Premera Your Future plan offers valuable benefits for a wide range of covered services. You also have the freedom of provider selection with network provider and non-network provider benefits for most covered services. 2. The Health Savings Account (HSA) Using a HSA gives you more control over how you spend your health-care dollars. You can fund this account with tax-advantaged contributions to pay for qualified expenses, including your plan deductible, any coinsurance and a broad range of other qualified healthcare expenses reimbursable under IRS guidelines. You may also choose to save your HSA contributions with investment options offered by the HSA administrator or trustee, allowing them to grow taxdeferred over time and carry over from year-to-year to use for future qualified health-care expenses. HSA components: 3. Your responsibility You are responsible for your plan s annual deductible and coinsurance. However, you may use your HSA funds to pay for these expenses. How a HSA works: Contributions Employees, employers and third parties may contribute to the HSA. The total of all annual contributions may not exceed the applicable limit set by the IRS. This amount will be prorated for periods of eligibility of less than a calendar year.* Distributions Employees choose how the funds in their HSA are spent, giving them greater control over their health-care dollars. They can use the funds to: Pay for qualified medical expenses before benefits begin, to help satisfy the required deductible Pay coinsurance Medical coverage (what your plan pays) The Health Savings Account (HSA) (save or use funds to pay for qualified medical expenses) Your responsibility (deductible + coinsurance) Cover other qualified medical expenses that may not be covered by the health plan, but are reimbursable under IRS guidelines Save for future medical expenses through the investment options offered by the HSA custodian or trustee. Portability Additionally, employees keep the account with them if they change employment or retire. See back cover of this brochure for examples of medical expenses that may be considered qualified medical expenses depending on the circumstances. For tax advice, please talk to your tax advisor. * If enrolling in a high-deductible health plan mid-year, consult with a tax advisor for applicable HSA contribution limits.
5 Using your HSA The following examples show how a Your Future plan and a HSA work together based on covered medical services through network providers. You may contribute up to the applicable limit set each year by the IRS. Always be sure that you have adequate money YEAR 1 in your account before paying a bill or reimbursing yourself. HSA CONTRIBUTIONS Example 1: Individual Ryan is a healthy single man. He only sees his provider for annual physical exams and/or injuries. He chose a HSA plan that has a $2,500 deductible and 20% coinsurance. The deductible is waived on preventive care exams and immunizations; however, the deductible applies to other covered services. Total contribution to the Health Savings Account for Ryan is $2,500 for year 1. After expenditures, $1,762 is available to carry over for use in year 2. $2,500 Example 2: Family Sue covers her spouse and $ three 38 Annual children physical under exam* a HSA family plan, which has $ 600 a $5,000 Injury** family deductible and -$738 20% coinsurance. $ 100 Blood The test** deductible is waived HSA on preventive care $ 738 exams Total and amount paid out in year 1 immunizations; however, the deductible applies $1,762 to other covered services. Total contributions to the Health Savings Account for Sue is $1,762 $2,875 for year 1. ** After Full amount expenditures, toward deductible. YEAR 2 CARRYOVER Ryan s HSA Distributions * 20% Coinsurance applied. Deductible waived for preventive exams. $2,509 is available to carry over for use in year 2. YEAR 1 HSA CONTRIBUTIONS YEAR 1 HSA CONTRIBUTIONS $2,500 Ryan s HSA Distributions $2,875 Sue s HSA Distributions HSA $1,762 -$738 $1,762 $ 38 Annual physical exam* $ 600 Injury** $ 100 Blood test** $ 738 Total amount paid out in year 1 * 20% Coinsurance applied. Deductible waived for preventive exams. ** Full amount toward deductible. HSA $2,509 -$366 $2,509 $ 120 Annual check-ups for children* $ 120 Office visit for children s illness** $ 24 Annual OB/GYN visit* $ 22 Pap test* $ 80 Child immunizations (3)* $ 366 Total amount paid out in year 1 * 20% Coinsurance applied. Deductible waived for preventive exams. YEAR 2 CARRYOVER YEAR 2 CARRYOVER ** Full amount toward deductible. YEAR 1 The examples above are for illustration purposes only and do not represent actual costs or contributions that you may experience HSA under CONTRIBUTIONS your Premera Health Savings Account plan and Health Savings Account. $2,875 -$366 Sue s HSA Distributions $ 120 Annual check-ups for children* $ 120 Office visit for children s Customer illness** Service: $ 24 Annual OB/GYN visit* $ 22 Pap test*
6 Health-care payment options Most Premera Your Future plans offer the freedom of provider selection with network provider and non-network provider benefits for many covered services. When you use network providers, you enjoy lower out-ofpocket expenses in most cases. You also have the freedom to see a specialist without a referral. When using network providers: Network providers submit claims directly to Premera for services provided. Premera pays benefits directly to the provider. You are typically responsible for your deductible, coinsurance and any charges for non-covered services. When using non-preferred providers: Health-care providers who are not contracted with Premera (non-preferred providers) may bill you directly or ask for payment in advance. For benefit reimbursement, you submit a claim to Premera. You are typically responsible for your deductible, coinsurance, any charges above Premera s maximum allowable amount and any charges for non-covered services. Explanation of Benefits: Once a claim submitted by your provider or you is processed, and benefits paid, you will receive an Explanation of Benefits (EOB). The EOB indicates amounts applied toward your deductible, provider fee adjustments for network discounts (when applicable) that lower your costs and any remaining amounts that are your responsibility. The following payment options, or combination options, may be available to pay any charges for services that are your responsibility. Your Premera Explanation of Benefits or provider s billing statement can provide you with detailed cost information. Check with your HSA administrator to see which options are available to you: Option A: Out-of-pocket For smaller expenses, you might consider paying out of your own pocket instead of with HSA funds. This would allow the money in your HSA to grow and pay for larger medical expenses down the road. Option B: HSA checks Use these as you would a personal checking account to pay bills you receive from your provider. Option C: HSA debit card If your provider accepts debit or credit cards, you can pay your bill using a HSA debit card. If you use the debit card, there may be an additional transaction fee. If you have questions about paying with your debit card, ask your provider for assistance. Option D: HSA reimbursement You may decide to pay your provider using another debit or credit card or a personal check. Then, you can use your HSA debit card or checks to withdraw an amount equal to your payment. Additional transaction fees may apply when using an ATM. Tax guidelines require you to file Form 8889 with your Federal Income Tax Return if you made contributions to or received distributions from your HSA during the calendar year. It s a good idea to save your medical expense receipts with your other annual tax material. For tax advice, talk to your tax advisor. 5
7 How do I get started? STEP 1: Select a qualified Health Savings Account administrator. HSA Bank For your convenience, Premera has established a relationship with HSA Bank* a qualified HSA administrator. Contact HSA Bank at or visit their web site at for information about how to apply for and set up your Health Savings Account. HSA Bank offers: STEP 2: Establish a HSA to open and begin managing your account. Consult with a tax and/or legal advisors to determine applicable HSA-contribution limits. For additional HSA information, please refer to IRS Publication 969, Health Savings Accounts and Other Tax-Favored Health Plans, available from the IRS web site, or order by calling TAX-FORM. Debit card access to HSA funds Online access to account information Monthly statements showing account activity 24-hour automated telephone banking service Assistance when you have questions Other resources If you receive your Premera Your Future plan coverage through your employer, check with your benefits manager to see if a HSA administrator is already available. Visit Speak to your tax or financial advisor for more information. Can I use my bank? Your Premera Your Future plan is qualified for use with a Health Savings Account established and managed only by a qualified HSA administrator. Not all banks are qualified HSA administrators. Check with your personal bank if they have this capability. To learn more about your medical benefits: Review your Benefit Booklet Review your How to Get the Most Out of Your Health Plan booklet Call the Customer Service number listed on the back of your Premera member ID card Visit for online provider directory coverage verification coverage details * HSA Bank is a division of Webster Bank, N.A. All accounts with HSA Bank are FDIC-insured. Customer Service:
8 Using your HSA Qualified HSA expenses Distributions from HSA s can be on a tax-advantaged basis when used for qualified medical expenses. In addition to medical plan deductible and coinsurance (your out-of-pocket expenses), below is a partial list of medical expenses that, depending on the circumstances, may be considered qualified medical expenses. Prior to making any expenditures from a HSA, it is the taxpayer s responsibility to determine whether these or any expenses are appropriate and meet IRS requirements for qualified medical expenses. You may be able to use HSA funds to pay for medical expenses such as: Abortion Acupuncture Alcoholism treatment Ambulance Anesthetist Arch supports Artificial limbs Autoette (when used for sickness or disability) Bandages Prescribed birth control pills Blood tests Blood transfusions Braces Cardiographs Childbirth/delivery Chiropractor Contact lenses Contraceptive devices (by prescription) Convalescent home (for medical treatment only) Crutches Dental treatment (non cosmetic) Dental X-rays Dentures Dermatologist Diagnostic fees Drug addiction therapy Drugs (by prescription) Elastic hosiery (by prescription) Eyeglasses Fees paid to health institute prescribed by a doctor FICA and FUTA tax paid for medical care service Guide dog Gum treatment Gynecologist Hearing aids and batteries Hospital services Hydrotherapy Insulin treatment Lab tests Metabolism test Neurologist Nursing services Obstetrician Operating room costs Ophthalmologist Optician Optometrist Oral surgery Organ transplant (including donor s expenses) Orthopedic shoes Orthopedist Osteopath Oxygen and oxygen equipment Pediatrician Physician Physiotherapist Podiatrist Postnatal treatments Practical nurse for medical services Prenatal care Prescription medicines Psychiatrist Psychoanalyst Psychologist Psychotherapy Registered nurse Special school costs for the handicapped Spinal fluid test Splints Sterilization Surgeon Telephone or TV equipment to assist the hard-of-hearing Therapy equipment Transportation expenses (relative to health care) Vaccines Vasectomy Vision correction surgery Vitamins (if prescribed) Wheelchair X-rays Non-qualifying Health Savings Account expenses The expenses shown below are examples of items not considered qualified medical expenses: Advance payment for services to be rendered next year Athletic club membership Auto insurance premium allocable to medical coverage Boarding school fees Bottled water Commuting expenses of disabled person Cosmetic surgery and procedures Cosmetics, hygiene products and similar items Funeral, cremation or burial expenses Health programs offered by resort hotels, health clubs and gyms Illegal operations and treatments Illegally procured drugs Maternity clothes Non-prescription medication Premiums for health insurance (with limited exceptions) Premiums for life insurance, income protection, disability, loss of limbs, sight or similar benefits Scientology counseling Social activities Special foods or beverages Specially designed car for the handicapped other than an autoette or special equipment Swimming pool Travel for general health improvement Tuition and expenses for a problem child to attend a particular school 2 HSA Bank has provided these lists and neither HSA Bank nor Premera make any representations or warranties as to their accuracy. These lists are intended to serve as a quick reference only. Neither Premera nor HSA Bank can provide tax advice. For more detailed information, refer to IRS publication 502, Medical and Dental Expenses, which you can download from the IRS Web site, or order by calling TAX-FORM. This communication was written to support the promotion or marketing of the matters discussed herein and is not intended or written to be used, and it may not be used by any taxpayer, for the purpose of avoiding penalties that may be imposed under the United States Internal Revenue Code. You should seek advice based on your particular circumstances from an independent tax advisor. Premera Blue Cross is an Independent Licensee of the Blue Cross Blue Shield Association ( )