Health Savings Account FAQs

Jennifer Johns
Jennifer Johns
  • Updated

 

If you enroll in either of Bedford City School District’s $4,000 Deductible Medical Plans, you have the option to contribute to a Health Savings Account, or HSA. This article contains many frequently asked questions about Health Savings Accounts.

Q: Can I sign up for a Health Savings Account?

A: If you enroll in either of Bedford City School District’s $4,000 Deductible Medical Plans, you have the option to contribute to a Health Savings Account, or HSA. If you are enrolled in either of the $300 Deductible (PPO) plans, you are not eligible for a Health Savings Account. 

Q: How much can I contribute to my Health Savings Account?

A: The IRS sets the annual limits for Health Savings Accounts. In 2023, the limit is $3,850 for single and $7,700 for family. If you are 55 or older and not entitled to Medicare benefits, you can contribute an additional $1,000 per year, called a "catch-up" contribution.

Q: When can I use the money in my Health Savings Account?

A: If you elect a Health Savings Account, your total annual contribution will be deducted from your paycheck in equal amounts throughout the calendar year. You can use the money in your Health Savings Account as soon as it is deposited (after each payroll deduction). 

Q: How do I use the money in my Health Savings Account?

A: Bedford City School District's preferred Health Savings Account partner is PayFlex. The PayFlex member website lets you pay your doctors, hospitals, and other qualified medical providers right from your PayFlex account. Visit www.payflex.com or call 844.729.3539 to get started!

Q: What can I pay for with my Health Savings Account dollars?

A: The IRS determines how you can spend your Health Savings Account dollars. Examples of qualified expenses include over-the-counter medications and healthcare items, hearing aids, co-payments for prescriptions, eyeglasses, orthodontics, and amounts you owe toward your deductible. For a complete list of eligible Health Savings Account expenses, please refer to IRS Publication 502.

Q: I've used a Flexible Spending Account in the past. Is a Health Savings Account the same thing?

A: No. Although a Flexible Spending Account (FSA) and Health Savings Account (HSA) both let you save pre-tax dollars for healthcare expenses, there are some important differences. One of the most important differences is that FSA's have a use it or lose it policy, meaning you risk losing some of your contributions if you don't use the money before the end of the year. Health Savings Accounts, on the other hand, allow you to keep your unused dollars indefinitely, even if you change jobs.

Q: Can I sign up for a Health Savings Account AND a Flexible Spending Account?

A: If you enroll in a Health Savings Account, the IRS permits you to also enroll in a special type of Flexible Spending Account, called a Limited Purpose FSA. A Limited Purpose FSA can be used to pay for dental and vision expenses that aren't covered by insurance.

Q: I am healthy and don't have many medical expenses. Do I need a Health Savings Account?

A: Health Savings Accounts are often used as a way to save for retirement. Even if you change jobs, the Health Savings Account remains yours, so you don't have to spend it immediately. Even though you may not have medical expenses now, it is likely that you or your family will have them in the future. A Health Savings Account lets you put money aside for healthcare costs now and in the future.

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