Benefits - Frequently Asked Questions
Q. What is a Health Savings Account?
A. A Health Savings Account is a custodial account that individuals covered by high-deductible health insurance plans can set up to pay medical expenses. (Health insurance premiums does not qualify as a reimbursable expenses from this account.) The contributions to the HSA come out of an individual's paycheck on a pre-tax basis. Any interest the account earns is tax-deferred, and the funds can be withdrawn tax-free at any time to pay medical expenses.
Q. Can I determine how much I want to contribute to the HSA each year?
A. The IRS limits how much a person can contribute to the HSA each year. For 2016, the limits for an individual is $3,350 and a family is $6,750. For anyone age 55 or older, you may make a catch up contribution of $1,000.
Q. Does the HSA function under the same "use it or lose it" rule?
A. No. Unlike the Flexible Spending Account, the Health Savings Account is your own personal account that may role over year after year.
Q. If I still have money in my FSA that rolls over into the next year, can I also have an HSA and make contributions into that plan?
A. No. The IRS states that if you have money that rolls into the next plan year, you must wait until the grace period of March 15th ends before you can open your Health Savings Account - even if you only have a very few dollars left in that account. So you will want to be sure you use up all your money in the FSA before 12/31/15 if you want to start a Health Savings Account at the beginning of 2016.
Q. Can I start and stop my contributions in my HSA anytime during the year?
A. Yes. Since you are setting up your own individual health savings account, you can stop or start your contributions anytime, as well as change your contribution amounts up to the annual limits.
Q. Do over-the-counter medicines and supplies qualify under the Health Savings Account?
A. Over-the-counter medicines can only be purchased with a prescription. However, medical supplies such as crutches, walkers, bandages, diagnostic devices such as blood sugar test strips will qualify for reimbursement.
Q. I understand that if I have a Health Savings Account I can use it to pay my medical expenses for me if I am enrolled in a high deductible plan. But if my spouse is enrolled in a Medicare plan, can I use the HSA money for my spouse?
A. Yes, an employee who has contributed to a validly-established HSA may use it to reimburse qualified medical expenses for any dependents claimed on their tax return.
Q. If I am enrolled in a Health Savings Account and then I retire and take the retiree Heath Reimbursement Account, can I still have access to my balance in my HSA and be enrolled in the HRA at the same time?
A. Yes. The HSA is an individual savings account belonging to the retiree which will not be impacted by the retiree's enrollment in or access to the HRA. One difference with the HRA is that this money can be used to pay health insurance premiums.
Q. Will there be an increase in my benefit premiums for 2016?
A. Yes. There will be an increase to lay employee premiums, clergy blended rate and the amount of clergy payroll deduction in 2016.The benefit plan continues to provide a comprehensive, quality medical insurance plan for participants and their families without disruption of network providers.
Q. The Choice Plus plan mentions co-insurance. What is the difference between co-insurance and co-payment?
A. Co-insurance is the percentage of covered medical expenses you must pay in conjunction with the percentage paid by United Health Care. These amounts together are called co-insurance because you (the member) and United Health Care (the insurance company) share the cost. A co-payment is the charge you are required to pay for certain services - Usually a set dollar amount. However, in 2016 the plan will only have a co-insurance after satisfying the deductible.
Q. Do I have to meet a deductible before the plan pays any benefits?
A. Yes. In 2016 you must meet your deductible before the plan begins to pay any benefits. For those enrolled in the family plan, the deductible is cumulative. One person can satisfy the family deductible or a combination of family members may satisfy the family deductible. Under the family plan, there will no longer be an individual deductible or individual maximum out-of-pocket. Therefore, the $3,000 family deductible must be satisfied before the plan begins to pay at the 80% co-insurance.
Q. Do I have to meet a deductible for prescription drugs in 2016?
A. Yes. The prescription drugs are also subject to the same $1,500 individual deductible or the $3,000 family deductible before the plan begins to pay at the 80% co-insurance.
Q. Will I have the option of the mail order for prescription drugs in 2016?
A. Yes. We will continue to have a mail order option with the new plan. The member will be responsible for the full contracted rate for their medications until they satisfy their deductible; then the plan will pay the 80% co-insurance. There will no longer be a co-payment for pharmacy. You will still be able to obtain a 90-day fill on medications but you will pay for all 3 months. You will no longer receive the third month free of charge.