Everything You Need to Know About FSA/HSA Rollovers
December 16, 2019
Are you looking to save money for your medical expenses? For benefit-eligible associates, Ascension provides savings accounts for paying your qualified medical, dental and vision expenses. The money deposited in these accounts is tax-free. Each account has different limits and rules. Learn the differences between these two options including how they rollover below:
Health Savings Account (HSA)
- Ascension contributes up to $225 in healthy rewards for completing Well-being Program activities, plus $600 if you sign up for individual HDHP coverage or $1,200 if you sign up for family coverage
- You must contribute at least $26 per year (only $1.00 per pay period) to receive Ascension's contributions
- Well-being Program healthy rewards deposited quarterly; your and Ascension's bi-weekly contributions are deposited each pay period
- You and Ascension together may not contribute more than $3,550 (individual coverage) or $7,100 (family coverage) in 2020
- Account earns interest and balances carry over from year to year
- You may take this account with you if you leave Ascension
Beginning Jan. 1, ConnectYourCare (CYC) will not only administer our HSA plan but also becomes the banking custodian for Health Savings Accounts (HSA). Currently, UMB serves as the banking custodian, which means that account and tax statements are prepared and sent by UMB. After Jan. 1, ConnectYourCare will take over these duties and all HSA information will be available on connectyourcare.com.
If you are contributing to an HSA in 2020, beginning with your Jan. 17 paycheck, your contributions as well as Ascension’s employer contributions will be deposited in a new HSA account at ConnectYourCare. Your current account balance will remain with UMB, and you will have the opportunity to combine your UMB and new CYC accounts in January at no cost.
Action required: January 7-21
If you currently have an HSA balance with UMB, you will receive additional information via email from Ascension and ConnectYourCare in January about combining your UMB and CYC health savings accounts. If you choose not to combine your accounts, UMB will begin charging a monthly account fee in February. If you have questions, please contact ConnectYourCare at 1-844-594-1231.
Important HSA reminders:
- 2020 payroll deductions begin Jan. 17: HSA deductions for 2020 will begin in your Jan. 17 paycheck. No FSA or HSA deductions will be taken from your Jan. 3 paycheck.
- Health Savings Accounts (HSAs) changes during the year: You can open an HSA at any time. You can also increase or decrease your contribution at any time.
- Upfront Ascension HSA contributions: Associates in medical plan pay bands 1 or 2 receive an upfront HSA contribution from Ascension, when they contribute at least $26 per year:
- Pay band 1: 50% upfront on Jan. 17; remainder split over next 25 pay periods
- Pay band 2: 25% upfront on Jan. 17; remainder split over next 25 pay periods
- All other pay bands: Contribution split evenly over 26 pay periods beginning Jan. 17
Healthcare Flexible Spending Account: (FSA)
Only you contribute to your FSA account. You may contribute the following:
- As much as $2,700 to your FSA
- As much as $5,000 per year to the Dependent Care FSA, if you are single or are married, filing a joint tax return, and your spouse does not participate in a flexible spending account, or as much as $2,500 per year if you are married and filing separately, or your spouse participates in a spending account at another organization
You should be aware that:
- Ascension does not contribute to FSA
- Your annual contributions are deposited on your benefit effective date
- The account does not earn interest and only $500 may carry over to next calendar year
- If you leave Ascension and purchase COBRA coverage, this account remains available to you
- Your medical plan choice does not impact the Dependent Care Flexible Spending Account. If you are benefit-eligible and have dependent care expenses while you and your spouse work or attend school, you may enroll for the Dependent Care FSA
It’s important to note that your HSA account earns interest and the full balance carries over from year to year. The FSA account does not earn interest and only $500 can carry over to the next calendar year. These are all things you can consider when deciding between opening an HSA or an FSA account.
Have Money to Spend?If you’ve got more money in your FSA that you’re permitted to carry over you should consider looking at permissible ways to spend the money before you lose it. The IRS publishes a list of generally allowable medical and dental expenses, now is a great time to make any appointments you need with your Ascension Network doctor, as out-of-pocket costs when visiting an Ascension Network doctor are considered a qualified expense. Many online retailers like FSA Store, Amazon and CVS have a section of their store dedicated to FSA eligible expenses; just make sure that you read the requirements to see if the item you’re purchasing requires a prescription, letter of medical necessity or doctor’s directive to be eligible. If you’ve made purchases throughout the year for things like sunscreen or other items you find on the list, you can make deductions after the fact so long as you have proper documentation for the purchase.