Employer's Frequently Asked Questions

What would an HSA do for us?

• Offering a Health Savings Account, will allow an employer to control rising health care costs and lower your employee's premiums. Employer contributions are excluded from taxable income, and employment taxes do not apply (saving you federal income tax, Social Security and Medicare taxes).

Why would I offer an FSA?

• Offering a Flexible Spending Account can reduce the employer's payroll taxes, including Social Security and Medicare. In addition, statistics prove increased employee satisfaction with this benefit option which can also lead to attraction and retention of employees.

Can I have an HSA and an FSA?

• Yes. You can offer a Regular FSA for those employees not enrolled in an HSA. You may also offer a Limited FSA for those eligible employees participating in an HSA. A Limited FSA plan will only cover dental, vision, and preventive care expenses. Please see our Limited FSA section under the Participants tab or click here to read more FAQs about this type of plan.

If I currently have a Premium Only Plan (POP) or FSA, do I need to revise my Summary Plan Description (SPD)?

• Whether you offer a POP or an FSA, your Summary Plan Description should be reviewed annually. Revisions should be made every two years or sooner if there are plan design changes or regulation updates. This is an administration service we can provide for you.

How would my company benefit from offering a Health Reimbursement Arrangement (HRA)?

• Offering an HRA allows the employer to save money on health insurance premiums by increasing the co-payments and deductibles under your health insurance plans. Essentially, it allows you to tackle the rising cost of healthcare and set long-term budget goals. The savings from the plan premiums can fund an HRA that will allow your employees to pay for unreimbursed medical expenses. Unlike Section 125 Flexible Spending Account plans, a Health Reimbursement Arrangement allows your participants to roll over any year-end balances for expenses incurred in subsequent years. Medical expenses reimbursed through a Health Reimbursement Account are excludable from the employee's gross income and are, therefore, not taxable.

What are some key advantages to the Employer by offering an HRA?

• Unlike an FSA, the employer does not need to pre-fund an HRA account. The employer decides the amount to contribute, the amount that can rolled over to the next plan year, and what happens to unused funds when an employee terminates. HRAs are available to any size group.

How will offering an HRA be beneficial to my employees?

• HRAs are a way for employers to give their employees freedom of choice in healthcare planning while controlling their own costs. HRAs enable employers to use tax deductible dollars to reimburse employees for qualified medical expenses. HRA contributions create a more attractive benefit package for employees who may object to a high deductible plan, because you are giving them money to pay for out-of-pocket medical expenses. HRAs may permit the employee to accumulate money for future healthcare needs such as retirement healthcare expenses.