HSA 101 - AmeriFlex

Report
B
Health Savings
Account
Program Overview
for
Excellus
Members
Overview of
The Bancorp Bank HSA Solution
for
Agenda
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Introduction to The Bancorp Bank
Review of HSA Basics
Account Materials
Statements & Tax Information
Account Funding/Withdrawals
Investment Platform
Maximizing HSA Savings
AmeriFlex Member Services Support
2
Who is The Bancorp Bank?
 An FDIC insured & publicly traded full-service
financial institution with a core focus on
Health Savings Account administration
 The preferred HSA custodian for the Ameriflex
HSA Program
 Headquartered locally in Delaware, yet one of
the top 5 HSA Custodians
 A leading HSA administrator since HSAs
were introduced in 2004
 Strong relationships with thousands of
Healthcare Carriers, Benefits Administrators
and Employer Groups throughout the U.S.
 The #1 Issuer of Healthcare Benefit Cards
3
HSA Key Features
 Funds deposited into an HSA are tax-advantaged and owned by the
account holder
 Funds may be rolled over year to year; no “use-it or lose-it” rule
 Accounts can accumulate significant assets that can be used for
healthcare tax-free
 Funds are portable and available through job changes
 Funds in the HSA can be invested
4
HSA Eligibility
 HSA account holders must be enrolled in an HSA-qualified High
Deductible Health Plan (HDHP) to open and continue contributing to a
Health Savings Account
Note: You can only contribute funds to your HSA while you are covered under an HDHP.
If you end your HDHP coverage, you can still draw down and pay for any qualified medical
expenses out of your HSA balance.
 Account holders cannot be covered by any other insurance that
reimburses for health expenses (unless another HSA-qualified plan)
 The account holder cannot be enrolled in Medicare or Medicaid
 The account holder also cannot be eligible to be claimed as a
dependent on another person’s tax return and they must be over 18
years of age
5
Contributions
 Contributions are not subject to income tax
 Contributions can be made by anyone
 Contributions in excess of the allowable limits
must be withdrawn or incur a 6% excise tax
2013 IRS Maximum
Contribution Limits
Individual $3250
Family
$6450
 Eligible individuals aged 55 or older may
contribute “catch-up” contributions of $1000.00
each year until they enroll in Medicare
 Only one catch-up contribution is permitted per
account for the individual account holder
6
Distributions
According to IRS guidance, funds withdrawn from an
HSA may be used to pay for HSA-qualified medical
expenses for the following individuals:
 Account holder
 Account holder’s spouse
 Account holder’s tax dependents
If a domestic partner or non-tax-dependent child is
covered on an individual’s health plan, they may
decide to open their own Health Savings Account to
utilize the same tax advantages
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Distributions (continued)
 Reimbursement can be taken from the HSA for
expenses you previously paid out of pocket as
long as the HSA was in place when it was
incurred
 Withdrawals for non-medical expenses are
possible, however additional taxes and penalties
may apply:
Before age 65 the distribution is taxed as
income plus an additional 20% penalty
After age 65 the withdrawal is only taxed as
income
 Distributions for qualified medical expenses not
taxable!
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Qualified Medical Expenses
According to the IRS, HSA funds can be used to pay for:
 Most Medical Care & Services covered by your health plan along
with Dental services, Vision Care & “Alternative” Care
 Over-the-counter (OTC) drugs such as pain relievers/cold
medicine may be purchased with HSA dollars if the account
holder has obtained a Doctor’s prescription
 Insurance premiums usually do not qualify, however the following
can be paid for with an HSA:
- Healthcare premiums while on COBRA continuation coverage
- Premiums while receiving unemployment compensation
- Medicare premiums
- Qualified long-term care insurance premiums
Some examples:
Rx Drugs
Physician’s Fees
Hospitalization
Orthodontia
Chiropractic care
Acupuncture
Reading Glasses
Contact Lens Solution
Maternity Costs
Laser Eye Surgery
Oxygen Equipment
Dental services
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Account Materials
Account information is transmitted to The
Bancorp Bank. Accounts are automatically
opened as long as all enrollment data passes
a regulatory review.
409 Silverside Road,
Suite 105
Wilmington, DE
19809
Bancorp will reach out to any members if any
further verification is needed to open their
account.
Within 2 weeks of account opening, each new
account holder receives the following:
Welcome Letter
Including account number and instructions to
register account online
AmeriFlex Convenience Card
NOTE: After account opening, be
sure to watch out for new materials in
the mail. For security reasons,
account-related materials are mailed
in generic envelopes simply noted
with a return address of:
409 Silverside Drive, Suite 105
Wilmington, DE 19809
Book of 50 checks
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Welcome Letter
New account holders will receive a welcome letter covering the following
important information:
 Information about the HSA, including the member’s account number and
instructions to register the account online
 HSA Signature Card with a postage-paid envelope for return to the bank
 A Deposit/HSA Contribution Slip
 Terms and Conditions (including schedule of fees)
 Privacy notice
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Statements & Tax Information
Statements
Available Online
Tax Forms for HSA Account holders:
 IRS Form 1040 or Form 1040NR
.
 IRS Form 8889
Download at www.irs.gov
Employers report all employer contributions
(including an employee’s contributions
through a cafeteria plan) to a Health Savings
Account in Box 12 of Form W-2 with Code W
See IRS General Instructions for Form W-2 for more details
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Filing Taxes with a Health Savings Account
To complete Form 8889, employees use their employer’s form W-2, and their
annual HSA contribution and distribution totals which can be pulled via the
following methods:
 "My HSA Snapshot" page – available via online bank account
 The Bancorp Bank’s Automated Telephone System
 The Bancorp Bank’s 24/7 Customer Service for Members
.
The Bancorp Bank will send additional records to the IRS and each account
holder:
 IRS Form 1099-SA, mailed by The Bancorp Bank by January 31st
(Details annual distributions)
 IRS Form 5498-SA, mailed by The Bancorp Bank by May 31st
(Details annual contributions.
Note: Form 5498-SA encompasses all contributions made for the prior calendar year until the
tax filing deadline. This document is not to be used for tax filing. It is always sent to
employees after the filing deadline has already passed to encompass all deposits
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Employee Contributions
Direct Deposit
Electronic
Bank
Transfers
(From other
bank account)
$
Employee
contribution
options
HSA
Check/
Money Order
ACH/Wire
Transfer
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Account Withdrawals
AmeriFlex
Convenience
Card
$
Employee
withdrawal
options
HSA
Online Bill
Payment
HSA
Checks
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Investment Platform

Self-directed brokerage account can be accessed
after logging into the HSA

Customers may begin investment account once
they have met the following criteria:
 HSA balance of $2500
 Signed and returned HSA Signature Card

Brokerage customers are able to place trades, find
stock quotes, perform research & track their
portfolio

Funds flow automatically to/from the HSA
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Maximizing HSA Savings
 Contribute whatever is possible (up to IRS limit) to increase
your tax savings
 Try local clinics vs. ERs for minor emergencies; Explore
alternatives to physician office visits if it makes sense
 Buy generic vs. brand-name prescriptions if they are available
 Compare different locations’ costs for medical
procedures/testing in advance. It is often possible to find a
lower-cost alternative for the exact same procedure
 “Bargain shop” for medicines at wholesalers Check out Wal-Mart's website for their $4.00 prescription list!
AmeriFlex Member Services Support
 888.868.FLEX (3539)
 Dedicated, toll-free Customer Service line for HSAspecific questions/needs
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