How does an HRA work?

An HRA is a reimbursement account set up and funded by your employer that helps you pay for qualified medical expenses incurred throughout the plan year on a tax free basis.

How do I use my HRA to pay for healthcare expenses?

You can use your Healthy Dollars, Inc account to pay your providers for eligible healthcare expenses, or pay with your personal funds and submit a claim for reimbursement.

What happens to the funds at the end of the plan year?

The rollover amount or unused funds, if any, is decided by the employer and specified in the Plan Document which is provided to all HRA participants.

How will I benefit from an HRA?

An HRA is offered in conjunction with your health insurance plan and is designed to help offset out-of-pocket financial responsibilities associated with your healthcare. The funds in the account can be used to pay for typical medical expenses not covered by your insurance plan such as doctor office visits, copays, prescription drugs, and hospital services.

The money your employer contributes to the account is not included in your salary and is not considered taxable income.

What are some qualifying expenses?

Eligible expenses will be outlined in the summary plan document and typically include:

* Copays, deductible payments, coinsurance

* Doctor office visits, exams, lab work

* Hospital visits

* Prescription drugs

Can I withdraw money from my HRA account?

You cannot withdraw money from the account from a bank or atm.  You must use your Healthy Dollars card, submit manual claims or pay the provider directly with the funds

How do I contribute money to my FSA?

Your annual election will be divided by the number of pay periods in your plan year. This amount will be deducted from your paycheck before taxes are assessed.

How much can I contribute to my FSA?

Annual contributions may not exceed $2,850 per year, as determined by the IRS.

Who is eligible under an FSA?

An FSA covers eligible expenses for you and all of your dependents, even if they are not covered under your primary health plan.

What expenses are eligible for reimbursement?

Health plan co-pays, deductibles, co-insurance, eyeglasses, dental care, and certain medical supplies are covered. The IRS provides specific guidance regarding eligible expenses. (See IRS Publication 502).

How do I determine the date my expenses were incurred?

Expenses are incurred at the time the medical care was provided, not when you are invoiced or pay the bill.

What happens if I don’t spend all of my FSA by the end of the plan year?

Be sure to only allocate dollars for predictable medical expenses. Any unused funds at the end of the plan year are typically forfeited, also called the use-it-or-lose-it rule.

Can I change my election amount mid-year?

Elections can only be altered if you experience a change in status as defined by IRS regulations, such as marriage, divorce, birth, or death in your immediate family.

What is the deadline for submitting claims?

You can submit claims for reimbursement at any time during the same plan year that you incur the expense. You may also have a grace period at the end of the plan year. Check the summary plan document your employer provided.

How do I get the funds out of my FSA?

If you have a benefits debit card, simply swipe it at the register. Otherwise, just file a claim including the receipt documenting the type, amount and date. Once approved, your reimbursement check will be mailed or deposited into your bank account.

How soon can I start spending my FSA funds?

With a healthcare FSA, your entire annual election amount is available on the first day of the plan year even though you have not yet contributed that amount.

What happens to my FSA if my employment is terminated?

Participation in your FSA is also terminated. This means that only expenses that were incurred prior to your termination date are eligible for reimbursement.

Can I still deduct healthcare expenses on my tax return?

Yes, but not the same expenses for which you have already been reimbursed from your FSA.

Are over-the-counter (OTC) medications eligible for reimbursement?

Yes. OTC medications are eligible with a doctor’s prescription. You will need to submit a claim with the receipt for the OTC medicine along with the prescription or (LMN) Letter of Medical Necessity from your doctor that includes the diagnosis and course of treatment to receive reimbursement.

What is a Letter of Medical Necessity (LMN)?

The IRS mandates that eligible expenses be primarily for the diagnosis, treatment or prevention of disease or for treatment of conditions affecting any functional part of the body. For example, vitamins are not typically covered because they are used for general wellness, but your doctor may prescribe a vitamin to treat your medical condition. The vitamin would then be eligible if your doctor verified the necessity in treatment.

Why should I participate in an HSA?

Funds contributed to an HSA are triple-tax-advantaged.

1) Money goes in tax-free. Most employers offer a payroll deduction through a Section 125 Cafeteria Plan, allowing you to make contributions to your HSA on a pre-tax basis. The contribution is deposited into your HSA prior to taxes being applied to your paycheck, making your savings immediate. You can also contribute to your HSA post-tax and recognize the same tax savings by claiming the deduction when filing your annual taxes.

2) Money comes out tax-free. Eligible healthcare purchases can be made tax-free when you use your HSA. Purchases can be made directly from your HSA account, either by using your benefits debit card, ACH, online bill-pay, or check – or, you can pay out-of-pocket and then reimburse yourself from your HSA.

3) Earn interest, tax-free. The interest on HSA funds grows on a tax-free basis. And, unlike most savings accounts, interest earned on an HSA is not considered taxable income when the funds are used for eligible medical expenses.

What is a high-deductible health plan?

An HDHP is a health insurance plan with deductible amounts that are greater than $1,400 for an individual or $2,800 for family coverage and have an out-of-pocket maximum that does not exceed $7,050 for an individual or $14,100 for family coverage.

Can I change my contributions to my HSA during the year?

Yes. You will not be subject to the change-in-status rules applicable to other benefit accounts. You will be able to make changes in your contributions by providing the applicable notice of change provided by your employer.

Do I have to spend all my contributions by the end of the plan year?

No. HSA money is yours to keep. Unlike a flexible spending account (FSA), unused money in your HSA isn’t forfeited at the end of the year; it continues to grow, tax-deferred.

What expenses are eligible for reimbursement?

Health plan co-pays, deductibles, co-insurance, vision, dental care, and certain medical supplies are covered. The IRS provides specific guidance regarding eligible expenses. (See IRS Publication 502). Am I eligible to participate? In order to contribute, you must be enrolled in a qualified HDHP, not covered under a secondary health insurance plan, not enrolled in Medicare, and not another person’s dependent. There are no eligibility requirements to spend previously-contributed HSA funds.

How do I contribute money to my HSA?

Payroll deduction is most likely offered by your employer. Your annual contribution will be divided into equal amounts and deducted from your payroll before taxes. Direct contributions can also be made from your personal checking account and can be deducted on your personal income tax return.

How much can I contribute to my HSA?

Contributions can be made by the eligible employee, their employer, or any other individual. Annual contributions from all sources may not exceed $3,650 for singles or $7,300 for families in 2022. Individuals aged 55 and over may make an additional $1,000 catch-up contributions.

What happens if I leave my job?

HSAs are portable and move with you if you change employment. Your HSA belongs to you, not your employer, just like your personal checking account.

When must contributions be made to an HSA for a taxable year?

Contributions for the taxable year can be made in one or more payments at any time after the year has begun and prior to the individual’s deadline (without extensions) for filing the eligible individual’s federal income tax return for that year. For most taxpayers, the deadline is April 15 of the year following the year for which contributions are made.

How do I access the funds in my HSA?

Your HSA is similar to a checking account. You are responsible for ensuring the money is spent on qualified purchases only and maintaining records to withstand IRS scrutiny. Payments can be made via check, ACH, online bill-pay, or debit card, depending on what is available to you.

What happens to the money in my HSA if I no longer have HDHP coverage?

Once you discontinue coverage under an HDHP and/ or get secondary health insurance coverage that disqualifies you from an HSA, you can no longer make contributions to your HSA. However, since you own the HSA, you can continue to use the remaining funds for future healthcare expenses.

Can I still deduct healthcare expenses on my tax return?

Yes, but not the same expenses for which you have already been reimbursed from your HSA.

Can I roll over or transfer funds from my HSA or Medical Savings Account (or Archer MSA) into an HSA?

Yes. Pre-existing HSA funds or MSA monies may be rolled into an HSA and will continue their tax-free status.

Is tax reporting required for an HSA?

Yes. IRS form 8889 must be completed with your tax return each year to report total deposits and withdrawals from your account. You do not have to itemize to complete this form.

Can I withdraw the money for non-healthcare purchases?

Yes. If you withdraw the money for an unqualified expense prior to age 65, you’ll be subject to your ordinary income tax, in addition to 20% tax penalty. You can withdraw the money for any reason without penalty after age 65, but are subject to applicable income taxes.

Can I control how the funds are invested?

Yes. Once your HSA cash account balance reaches the minimum amount required by the custodian, you can transfer funds to an HSA investment account. You can choose from a selection of mutual funds and set up an allocation model for future transfers like you would for a 401k plan. For more information, click here.

Can I transfer funds between the cash and investment accounts?

Yes. You can transfer money between your HSA cash and HSA investment account at any time

Why should I participate?

Since contributions to the account are deducted from your paycheck before income taxes are assessed, your taxable income is reduced. Participants enjoy a 30% average tax savings on the total amount they contribute to the account.  

How much can I contribute?

The IRS limits annual contributions to $5,000 on income tax returns for single or married filing jointly, and $2,500 for married filing separately.

How do I contribute money to my DCA?

Once you make your annual election during open enrollment, your employer will deduct this amount from your paycheck before taxes are assessed in equal amounts throughout the year.

Who qualifies as a dependent?

You can use your DCA to pay for care for children under age 13 that you claim as dependents, as well as adults or other relatives that are incapable of caring for themselves (if you provide more than 50% of their support).

What type of care is eligible?

Eligible expenses must be for the purpose of allowing you to work or look for work. Services may be provided at a child or adult care center, nursery, preschool, after-school, summer day camp, or a nanny in your home.

What type of care is not eligible?

Care expenses that are not eligible to be paid with DCA funds include care for a child over age 13, overnight camp, babysitting that is not work related, school fees for kindergarten and higher grades, and long-term care services.

Do I have access to my entire DCA election amount at the beginning of the year?

No, you will only have access to DCA funds that have already been deducted from your paycheck.

Are there any rules about who can care for my dependents?

Yes. You can not use funds to pay for care provided by a spouse, a person you list as a dependent for income tax purposes, or one of your children under the age of 19.

How do I use the funds in my account?

If you have a benefits debit card and your care provider accepts credit cards, you may pay directly from your account. Otherwise, pay out-of-pocket and then file a reimbursement claim with your expense documentation.

What happens if I don’t spend all of my DCA funds by the end of the plan year?

It is essential to estimate conservatively during elections. Any unused funds at the end of the plan year are forfeited, also called the use-it-or-lose-it rule.

Can I change my election amount mid-year?

Typically, you cannot change your contribution midyear. However, if you experience a qualifying event, such as the birth of a new child, or if your child care provider significantly increases their rates, you may be eligible to adjust your contribution.

What happens to my account if my employment is terminated?

Participation in the plan is also terminated. This means that only expenses that were incurred prior to your termination date are eligible for reimbursement.

How does an ICHRA work?

An HRA is a reimbursement account set up and funded by your employer that helps you pay for qualified medical expenses incurred throughout the plan year on a tax free basis.

How do I use my ICHRA to pay for healthcare expenses?

You can use your Healthy Dollars card to pay the providers for eligible heatlhcare expenses, or pay with your personal funds and submit a claim for reimbursement.

How will I benefit from an ICHRA?

An HRA is offered in conjunction with your health insurance plan and is designed to help offset out-of-pocket financial responsibilities associated with your healthcare. The funds in the account can be used to pay for typical medical expenses not covered by your insurance plan such as doctor office visits, copays, prescription drugs, and hospital services. The money your employer contributes to the account is not included in your salary and is not considered taxable income.

How does an QSEHRA work?

Allows small employers to provide non-taxed reimbursement of certain health care expenses, like health insurance premiums and coinsurance, to employees who maintain minimum essential coverage, including an individual Marketplace plan.

What are the limits for QSEHRA in 2021?

In 2022, small businesses may offer up to $5,450 per self-only employee and up to $11,500 per employee with a family.

Does QSEHRA plans cover dental and vision?

Yes, dental and vision premiums and expenses can be reimbursed through a QSEHRA. However, remember that an employee must have medical insurance that qualifies as minimum essential coverage (MEC) in order to participate in the QSEHRA at all.

What is MEC - Minimum Essential Coverage?

Minimum Essential Coverage is defined as the type of health insurance coverage that you must have in order to comply with the individual mandate set forth by the Affordable Care Act (ACA) . From January 1, 2014, and onward, individuals must have MEC insurance or they will be subject to a tax penalty.

What is a Commuter Account?

A commuter account is an employer-sponsored benefit program that allows you to set aside pre-tax funds in a separate account to pay for qualified mass transit and parking expenses associated with your commute to work.

What is a qualified mass transit expense?

Qualified expenses include transit passes, tokens, fare cards, vouchers, or similar items entitling you to ride to work.  This includes publicly and privately operated and includes bus, rail, or ferry.

Why should I participate?

Contributions to the account are deducted from your paycheck on a pre-tax basis, reducing your taxable income.  You can save an average of 30% on your eligible transit and parking expenses.

What commuter expenses are covered?

Eligible expenses include those incurred for your transportation between your residence and worksite.  Spouses and children are NOT eligible.

What qualifies as Van-pooling?

Van-pooling is not to be confused with Car-pooling.  Van-pooling requires a commuter highway vehicle with a seating capacity of at least 7 adults, including the driver.  At least 80% of the vehicle mileage must be for transporting employees between their homes and workplace with employees occupying at least 1/2 of the vehicle's seats.

What is a qualified Parking expense?

Get reimbursed for parking expenses incurred at or near your work locations or a location from which you continue your commute to work by car pool, van-pool or mass transit.  Out-of-pocket parking fees for parking meters, garages and lots qualify. Parking at or near your home is not an eligible expense.

Can I use my commuter account for commuting expenses like tolls and gas?

No. Benefits may not be used for tolls, gas, mileage or other personal commuting expenses.

How does it work?

You authorize your employer to deduct a pre-tax amount for parking and or van-pooling/transit from each paycheck, up to the IRS limits.

Is there a limit to how much I can contribute or spend each month?

Yes. Monthly limits are set by the IRS.  Currently, contributions, as well as monthly spending limits, are set to $280 per month. 

Can I change my election amount during the year?

Yes. You can change the election amount or terminate the plan at any time.

What happens if I don't use all of my funds that the end of the year?

The funds will be rolled over to the next year's plan as long as your participate and are with the company as an employee.

Do I need to keep my receipts?

Yes.  A valid receipt should have the merchant name, date, amount of expense, and a description of the purchase for a transportation pass or parking.

What is a lifestyle spending account?

Lifestyle Spending Accounts are funds set aside for you by your employer to help pay for items you need for everyday life. Your employer determines where you can spend these funds.

What types of purchases can be made with a lifestyle spending account?

Your employer determines how you can spend these funds. For example, one employer may choose to allow employees to spend these funds on gas and groceries. Another employer may choose to allow employees to spend funds on utility bills and home repairs. Your employer will provide you with details of how your Lifestyle Spending Account funds can be used.

Where is the debit card accepted?

The Lifestyle Spending Account debit card can be used anywhere Mastercard is accepted if the merchant category codes align with the spending parameters established by your employer

How does a lifestyle spending account work?

Your employer contributes funds to your Lifestyle Spending Account on a yearly, monthly, or per pay period basis. Your employer chooses the amount they will contribute to your account and determines if there are any limits to the amount that can be spent on specific services. You can then access the funds in the form of a convenient debit card. You may request to be reimbursed for purchases through direct deposit to your checking or savings account.

How do I access these funds?

You will be issued a Healthy Dollars, Inc. debit card for your account. If you participate in other Healthy Dollars, Inc. benefit accounts, your current card will access these funds and coordinate with your other accounts.

Can I submit a claim for manual reimbursement?

While a debit card is the most convenient way to access Lifestyle Spending Account funds, you may use personal funds for qualified expenses and submit claims for manual reimbursement.

Do these accounts represent taxable income for me?

Lifestyle Spending Accounts do not currently have any tax advantages. They are funded by your employer, on a post-tax basis, and are considered taxable income for you.