HSAs & HRAs

Introduction | Consumer-Driven Health | HSAs & HRAs | Retiree Health

Health Savings Account (HSA)

Health Savings Accounts are available to members who do not have Medicare or another health plan. The amount of the "premium pass through" is based on whether you have a Self Only or Self and Family enrollment. You have the option to make tax-free contributions to your account, provided the total contributions do not exceed the limits established by law, which are typically not more than the plan deductible. If you are over 55, you can make an additional "catch up" contribution. You can use funds in your account to help pay your health plan deductible. However, if you enroll in a HDHP with a HSA, you are not eligible to participate in a Health Care Flexible Spending account.

Features of an HSA include:

• Tax-deductible deposits you make to the HSA.
• Tax-deferred interest earned on the account.
• Tax-free withdrawals for qualified medical expenses.
• Carryover of unused funds and interest from year to year.
• Portability; the account is owned by you and is yours to keep - even when you retire.

Health Reimbursement Arrangement (HRA)

For members who are not eligible for an HSA, have Medicare or another non-High Deductible Health Plan, the HDHP will provide and administer a Health Reimbursement Arrangement.

The plan will credit the HRA different amounts depending on whether you have a Self Only or a Self and Family enrollment. You can use funds in your account to help pay your health plan deductible.

Features of an HRA include:

• Tax-free withdrawals for qualified medical expenses.
• Carryover of unused credits from year to year.
• Credits in an HRA do not earn interest.
• Credits in the HRA are forfeited if you leave federal employment or switch health insurance plans.

	Health Savings Account (HSA)	Health Reimbursement Arrangement (HRA)
ELIGIBILITY	You must enroll in a High Deductible Health Plan. No other general medical insurance coverage permitted. You cannot be enrolled in Medicare Part A or Part B.	You must enroll in a High Deductible Health Plan.
FUNDING	The plan deposits a monthly "premium pass through?into your account.	The plan deposits the credit amount directly into your HRA.
CONTRIBUTIONS	The maximum allowed is a combination of the health plan "premium pass through?and the member contribution up to the amount of the plan deductible.	Only that portion of the premium specified by the health plan will be contributed. You cannot add your own money to an HRA.
DISTRIBUTIONS	May be used to pay the out-of-pocket medical expenses for yourself, your spouse, or your dependents, or to pay the plan's deductible. See IRS Publication 502 for a complete list of eligible expenses.	May be used to pay the out-of-pocket expenses for qualified medical expenses for individuals covered under the health plan, or to pay the plan's deductible. See IRS Publication 502 for a complete list of eligible expenses.
PORTABLE	Yes, you can take this account with you when you terminate employment or retire.	If you retire and remain in your health plan you may continue to use and accumulate credits in your HRA. If you terminate employment or change health plans, only eligible expenses incurred while covered under that health plan will be eligible for reimbursement, subject to timely filing requirements. Unused credits are forfeited.
ANNUAL ROLLOVER	Yes, funds accumulate without a maximum cap.	Yes, credits accumulate without a maximum cap.