Spending accountsFor self-funded businesses
Clients with a qualified high-deductible health plan (QHDHP) have the option of offering health savings accounts (HSAs), which are tax-advantaged member-owned accounts that let your members save pre-tax dollars1 for future qualified medical expenses. HSA funds never expire, and members have the option to invest HSA money to build the ultimate retirement nest egg.2,3
Health savings accounts (HSAs)
HSAs offer your employees a tax-advantaged way to save and pay for qualified out-of-pocket health care expenses. To enroll in an HSA, the employee must be covered by a QHDHP. HSAs can be funded by an employer, an employee, or both.
Employees contribute to HSAs through pre-tax payroll deduction, check, or online transfer. Contributions are tax-deductible, and distributions are tax-free when used to pay for qualified medical expenses. Interest and earnings are also tax-free.4
Employers may make pre-tax contributions to their employees' HSAs. These contributions are not subject to withholding from wages for income tax or subject to FICA, FUTA, or the Railroad Retirement Act.
The HSA is employee-owned, so if he or she changes jobs, the account goes with that employee. In addition to using the HSA to pay for out-of-pocket health care costs, employees may also open an optional investment account with a portion of their funds, allowing the HSA to become an investment vehicle.5
The BlueSaver® HSA Solution
Our BlueSaver HSA Solution is closely integrated with our medical products and services to ensure a seamless experience for your employees, to help them take full advantage of their health plan benefits.
The BlueSaver HSA Solution offers employees all the advantages of an HSA, along with claim and payment integration to make account management easy. This integration creates a one-of-a-kind experience for our members while also assisting them in becoming more informed health care consumers.
Reduce prescription costs with the BlueSaver HSA Solution pharmacy benefit
With the BlueSaver HSA Solution, customers can add a benefit that helps them save money and makes it easier for members with chronic conditions to afford preventive medications.
When a member with an HSA-qualified HDHP fills a prescription for any of the eligible preventive medications, the deductible is waived. The member simply pays the plan’s copay or coinsurance. This benefit is only available for experience-rated plans as a buy-up option. View the complete HSA HDHP Drug List.
Refer to IRS Publication 502: Medical and Dental Expenses for a complete list of qualified expenses.
WealthCare Saver Investment Solution
Members who are enrolled in an QHDHP with an HSA with over $500 have the option to invest their funds utilizing a next-generation HSA investment solution that includes real-time and fractional trading, a fully automated robo advisor, and a full range of investing models for every investor experience level.5 Best of all, the new solution is fully integrated, allowing account holders to manage all aspects of their HSA through the member portal or the IBX Mobile App.6
Investment options include:
- Managed. A portfolio option based on risk profile
- Self-directed. A curated list of low expense ratio exchange-traded funds (ETFs)
- Brokerage. A flexible investing option with over 500 ETFs and 100s of individual stocks — including fractional trading
High-yield interest option available to account holders with HSAs
Members enrolled in a QHDHP with an HSA can choose between two interest options for their cash deposits.7
- Traditional. Account holders earn standard interest rates on their cash balance. Cash deposits are FDIC-insured up to $250k and receive a lower interest rate.
- High-yield. Account holders earn a higher interest rate on their cash balance. The high-yield cash account funds are not FDIC-insured and are held in a deposit account backed by Pacific Life, a highly rated California insurance company.
Contact us
For more information about the BlueSaver HSA Solution, contact your IBX account executive, broker, or consultant — or call 215-241-2263.
Health reimbursement arrangements (HRAs)
HRAs are tax-advantaged accounts funded with employer dollars to pay employee expenses not covered by their health plan. Employers outline what expenses will be covered by the HRA within the limitations outlined by Internal Revenue Service Publication 969, and employers can deduct the amount of their contributions when employees use the funds. Although an HRA can have an option to carry forward unused funds, an employee cannot take their HRA funds to a new employer.
The BlueSaver HRA
The BlueSaver HRA offers employers flexibility and a wide range of options to align the HRA with your organization’s overall health care and financial strategies.
Features of the BlueSaver HRA include:
- Flexible coverage options — including deductible, copay and/or coinsurance, limited types of expenses8
- The ability to reimburse a percentage of each claim or to include an employee up-front out-of-pocket requirement before the HRA covers expenses
- Easy enrollment based upon medical plan election
- Easy account maintenance and on-demand reporting
- Automated claims rollover
- Availability of a direct payment to provider option
- Optional no-cost debit card for the subscriber and dependents over 18
Flexible spending accounts (FSAs)
FSAs are personal accounts funded by employees. An FSA lets your employees set aside pre-tax dollars to pay for eligible expenses like health care and/or dependent care, depending on plan type. Employers benefit by offering FSAs because participation reduces employees’ taxable income — which can reduce FICA taxes for employers.
Please note: BlueSaver FSAs are available to groups of 100+ eligible employees.
The BlueSaver FSA
The BlueSaver health care FSA is closely integrated with our medical products and services to improve the experience for members and help them take full advantage of their benefits. The dependent care account offers similar features — including online claims submission to speed up reimbursement.
Features of our BlueSaver health care FSA include:
- Easy account maintenance and on-demand reporting
- Automated claims rollover
- Optional direct payment to medical provider
- No-cost debit card for the subscriber and dependents over 18
Refer to IRS Publication 502 for a complete list of qualified medical and dental expenses. Refer to IRS Publication 503 for more information about dependents and dependent care FSAs.
1 HSAs are never taxed at a federal income tax level when used appropriately for qualified medical expenses. Also, most states recognize HSA funds as tax-deductible with very few exceptions. Please consult a tax advisor regarding your state's specific rules.
2 Investments are subject to risk, including the possible loss of the principal invested, and are not FDIC or NCUA-insured or guaranteed. Investing may not be suitable for everyone, and before making any investments, review the fund's prospectus.
3 The balance in an HSA Investment Account is subject to investment risks, including fluctuations in value and the possible loss of the principal amount invested.
4 Tax savings are at the federal level. State tax laws vary.
5 Invested funds are not FDIC-insured and may lose value. The balance in the HSA Investment Account is subject to investment risks, including fluctuations in value and the possible loss of the principal amount invested. Investing through the WealthCare Saver investment platform is subject to the terms and conditions of the Health Savings Account Custodial Agreement and any applicable investment supplement(s). For information regarding underlying investment expenses, earnings, and distributions, see the applicable investment prospectus and other publicly available information.
6 An optional investment account may be opened when the account balance exceeds $500; additional fees apply.
7 This choice only impacts the HSA cash balance and does not impact the investment account if the account holder is enrolled in one. Account holders may change their interest option preference at any time.
8 Because an HRA offers employer-owned funds, there is greater flexibility in what expenses are covered, provided they are considered qualified medical and dental expenses. Refer to IRS Publication 502 for a complete list of qualified medical and dental expenses.