Health Savings AccountWhat is an HSA?A Health Savings Account, or HSA, is a tax-advantaged savings account available to taxpayerswho are enrolled in a high deductible health plan - at VELCO that means being enrolled in ourCIGNA HDP. HSAs allow for both employer and employee contributions; funds contributed to anHSA are not subject to federal or state income tax (with the exception of California and NewJersey). HSA funds may be used to pay for qualified medical expenses at any time, without taxliability or penalty. Unlike a flexible spending account (FSA), unused funds roll over andaccumulate year to year. And, HSAs are individually owned, which means that you take youraccount with you when you leave VELCO.What expenses can be paid through an HSA?HSAs can be used to pay for unreimbursed healthcare expenses as listed in IRS Code Section213(d). Some examples of HSA-eligible expenses are deductibles, co-insurance, co-pays,acupuncture, durable medical supplies, hearing aids, orthodontics, and artificial limbs.Where will my HSA be administered?VELCO partners with Fidelity for HSA services. Employees newly enrolled in the HSA plan willbe instructed how to set up their Fidelity HSA.How do I pay for healthcare expenses with my HSA?HSA account holders will receive a debit card from Fidelity. This card can be used for HSAeligible expenses at qualified locations. Alternatively, you may file a claim for reimbursementfrom your Fidelity HSA. You are responsible for keeping receipts in the event the IRS audits yourtax return.What happens to the money in the HSA if I don’t file any claims?The money remains in the account and rolls-over from year to year. Investment options areavailable. Please check with HR or Fidelity for more information.
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