Health Savings Accounts (HSA)
A Health Savings Account (HSA) is a tax-advantaged medical savings account that individuals who enroll in a high-deductible health plan (HDHP) are eligible for. The funds contributed to an HSA are not subject to federal income tax at the time of deposit and HSA funds roll over and accumulate year to year if they are not spent. HSAs are owned by the employee and are portable.
The amount that can be contributed to an HSA during the calendar year is regulated by the IRS. IRS limits depend on the type of plan an employee has (family vs individual) and the age of the employee (see the chart below for the current limits). Employees who are over 55 are allowed by the IRS to contribute $1,000 more than the limits shown below for the respective calendar years. The IRS limits below include all contributions made to an HSA account in any given calendar year. An employee with a family plan who is under 55 will only be able to contribute $5,200 to his/her HSA in 2021 because of the $2,000 employer contribution. Together, the $5,200 from the employee and the $2,000 from the employer equal the $7,200 limit for the year per the IRS.
The Town of Wellesley will set up a Health Savings Account (HSA) for any benefit eligible employee who enrolls in a High Deductible Health Plan (HDHP). In addition to setting up the account, the Town will contribute $1,000 into an HSA for each benefit eligible Town employee selecting an individual HDHP and $2,000 into an HSA for each benefit eligible Town employee selecting a family HDHP.
Health Equity Partners is the entity that manages the HSA program for the Town of Wellesley. Health Equity Partners offers a variety of member tools that can be found here.
The Coronavirus Aid, Relief, and Economic Security Act (CARES Act) provides for reimbursement for services for "telemedicine and other remote care services" below the deductible and will be permitted in an HSA-qualified health plan (HDHP). This provision is effective March 27, 2020 through December 31, 2021.
Some helpful HSA resource links are as follows:
|HSA Qualified Medical Expenses list||Uploading a Documentation to the Portal|
|Health Equity Mobile App Instructions||Uploading a receipt to the Portal|
Below are some additional resources to help explain how HSA’s work.
|The Complete HSA Guidebook||Health Equity HSA Videos|
|HSA Qualified High Deductible Health Plan Video||Health Equity Tools for members|
|Health Equity Partners Website||Understanding Health Savings Accounts video|
|Health Equity Webinars|
Medicare Eligibility could have an impact on your ability to contribute and/or participate in an HSA. For more information on how Medicare Eligibility can impact your HSA, please refer to the Medicare Eligibility and Your HSA guide.