New Brochure Explains the Value of an HSA
Do your employees participate in a health savings account (HSA)? If they are eligible but don’t yet have an HSA, do they know what they’re missing out on?
A new brochure you can order in print for your employees explains how HSAs work and their benefits for retirement savers. To request copies of “Is an HSA Right for You?” call the Member Contact Center at 866.673.2299 and ask for publication number GRPBR19034.
A PDF of the brochure is also available online in the BA Guide.
Triple tax benefits
For employees eligible to contribute, HSAs offer a means of saving for health care expenses in retirement, while also saving on taxes in three ways:
- Contributions are made pre-tax, reducing taxable income.
- If those dollars are invested, the earnings can grow tax-free.
- The money can be withdrawn tax-free in retirement to pay for qualified health expenses.
HSAs are also portable, meaning account holders own 100 percent of their account balances, even if they change jobs. It may be useful for employees to understand that unlike an FSA (flexible spending account), there is no “use it or lose it” component to an HSA.
And at a time when employees are often nervous about having enough money to cover medical costs in retirement, an HSA can provide extra security.
Who can contribute to an HSA?
Only participants in a qualified high-deductible health plan (HDHP) are eligible to make or receive contributions to an HSA. For the 2020 plan year, a qualified HDHP is a plan that has a minimum deductible of $1,400 for individual and $2,800 for family coverage.
If your co-op offers the 125 Plan administered by Cooperative Benefits Administrators, your employees can make pre-tax HSA contributions through its Health Savings Account Benefit Plan. If your co-op chooses, employees can set up an HSA through NRECA’s partner, HealthEquity, or through another HSA trustee.
If you have questions about how to help your employees establish an HSA, contact your field services representative.