Health Savings Account (HSA)

All active, benefits-eligible employees enrolled in Basic Health are able to have an HSA. You must be eligible for an HSA in order to enroll in Basic Health. 

You are eligible for an HSA if:

• You are not a wage employee
• You do not hold a J-1 visa
• You are not enrolled in Medicare or Medicaid, or are listed as a dependent on someone else’s tax return
• You, or your spouse, do not have a balance in a full healthcare FSA, are part of a FSA grace period, or your plan year is not over
• You have not received healthcare benefits from the Veterans Administration (TRICARE) within the last 3 months
• You do not have a spouse or parent enrolled in a healthcare plan (including a Health Reimbursement Account) that provides you benefits before meeting the annual IRS minimum deductible
• You have not already contributed the annual federal limit to another HSA, Medical Savings Account (MSA), or HRA in the same calendar year.

IRS regulations state that contributions cannot be made to HSA accounts of those who are enrolled in Medicare, regardless of the fact that Medicare Part A is premium-free or whether you use your Medicare Part A coverage. If you are enrolled in Medicare Part A, you cannot be enrolled in the UVA HSA Program. Since you must be eligible for an HSA in order to enroll in Basic Health, you cannot be enrolled in Basic Health if you’re enrolled in Medicare Part A. The same is true if you’re enrolled in Medicare Part B.

Enrolling in Medicare during the plan year does not allow you to switch health options from Basic Health to Value or Choice Health. Therefore, please consider your Medicare options carefully before electing a UVA Health Plan option, and consult with your tax advisor about tax consequences.

Premium-free Part A Medicare coverage will go back (retroactively) 6 months from when you sign up for Part A or apply for benefits from Social Security, but no earlier than the first month you’re eligible for Medicare. Review the Health Savings Accounts section on page 20 of the Medicare handbook for more information and to make sure you stop your HSA contributions in time to avoid a tax penalty.

If you are enrolled in a Health Savings Account, you are not eligible for a Full Healthcare Flexible Spending Account, but you can enroll in a Limited and/or Dependent Daycare Flexible Spending Account to maximize your savings. Learn more about a Limited Flexible Spending Account.

Depending on your employee type, UVA may contribute money to your HSA to help offset the higher deductible. Currently, UVA contributes money to open HSA accounts in the UVA Health Savings Account Program for permanent full- and part-time benefits-eligible academic and medical center employees who are enrolled in the UVA Health Plan's Basic Health option and are active employees receiving a paycheck on the date UVA makes this contribution. Wage employees enrolled in Basic Health are not part of this population. These funds roll over from year-to-year and are yours to keep and use for eligible expenses even if you switch to another UVA Health Plan option or leave the University.

Based on whether you are covering only yourself with Basic Health, or other eligible dependents, you will receive the following employer contribution:

• Employee Only: $1,000
• Family: $1,500

The annual employer contribution from UVA will be prorated in the following instances:

• New hire enrollments and employees who are newly eligible for benefits
• Employees who have delays in opening their HSA accounts (contribution will be provided the month following account activation with Fidelity)
• UVA employer contributions will not change for any employee who gains or loses a dependent in the same calendar year

You may choose to contribute to your HSA, though you are not required to do so. Employee contributions made by payroll are deducted before taxes. Each year, the IRS sets a contribution limit. This limit includes employer and employee contributions and is per household.

• If electing to make an employee contribution, the minimum per year is $120.
• You and your employer can contribute a maximum of $3,850 for employee only, or $7,750 for employee + dependents. These are pre-tax dollars reserved for health care expenses and carry over beyond your retirement.
• Those age 55 and older may make an additional catch-up contribution of up to $1,000 per year.
• If your HSA employee deductions aren’t taken from your paychecks because you don’t have enough earnings, the missing deductions will be taken from future paychecks when you again have enough earnings to withhold HSA deductions. Workday will only take one additional missing HSA deduction from each future paycheck in addition to any current deduction until all missing deductions are paid.

Keep in mind, the limits above includes employer and employee contributions.

For example, if you are under 55 and want to contribute the maximum of $3,850 to your HSA and are eligible to receive $1,000 in employer contributions, you would elect $2,850 as the employee contribution, to meet the maximum IRS limit for the year of $3,850. 

Employer contributions for those enrolled in the HSA Program on January 1st are sent to your Fidelity account following your first benefits deduction payroll of the calendar year. 

Balances roll over each year and accrue interest, and you keep the balance even if you leave UVA.

Once you have a balance of $1,000 in your HSA, you may invest it in mutual funds; any growth made from the investment is tax-free as long as it is used on eligible medical expenses.

HSAs work like a regular savings account. Please pay attention to emails you receive from Fidelity (the company that administers UVA’s HSAs, FSAs, and Dependent Daycare Reimbursement Accounts); you may be required to take important action to open your account.

Contributions are accepted into new HSAs the month after the account is opened by Fidelity.

For example, if you are a new employee who signs up for Basic Health in mid-August, your HSA may be opened in September. Your prorated UVA annual employer contribution, and any contributions you choose to make by payroll deduction, would go into your account starting in October.

Sometimes Fidelity may request more information to open an account. Be sure to follow up on any requests to get your HSA opened in a timely manner. Anyone with a PO box as their home address in Workday will have their request to open a health savings account rejected by Fidelity and will be required to update their PO box to a physical address before their HSA can be opened. 

Funds deposited into Health Savings Accounts will be available to spend 4-5 business days after the payday when they are deposited. After contributions are in your account and available, there are two ways to use those funds for eligible expenses:

• Use your prepaid benefits card, the Fidelity NetBenefits Card, at the time of purchase for eligible expenses. 
• Submit claims or make payments from your accounts online through Fidelity's website.

Always remember to keep receipts for your records and to illustrate the funds were used properly in the event of an IRS inquiry.

Your Fidelity HSA is a brokerage account and the funds can be invested in any security available on the Fidelity platform (individual stocks and bonds, Exchange-Traded Funds (ETFs), mutual funds, etc.).To learn more about your HSA investment options with Fidelity, visit these websites (both offer you filter criteria for which funds to view):

• Fidelity Mutual Fund Screener
• Fidelity ETF Screener

When you first open an HSA, and/or a limited FSA, with Basic Health, you will receive your prepaid benefits card, the Fidelity NetBenefits Access Card, in the mail to your home address. If you have both an HSA and LPFSA, this one NetBenefits Access Card will draw from either of your accounts, and it automatically decides which account to draw from based on the purchase. To replace your card or order additional cards, visit the Fidelity HSA Debit Card webpage.

If you have concerns about not receiving your card or questions about how to use your card, please contact Fidelity for more information by calling 800.343.0860.

Tips from Fidelity:

• Make the most of your health plan and Fidelity HSA
• Turning 65? Here's what you need to know about your HSA

Videos:

• Getting the most from your Health Savings Account
• HSA eligible expenses and ways to pay them
• Tips to save money on healthcare costs

It is very important that if you signed up for Basic Health for the first time, and if you currently have a Full FSA, that you deplete your Full FSA balance to $0.00. If you do not have a zero balance in your FSA by January 1:

• Your HSA cannot be opened and you cannot make employee contributions until April 1
• Deposited funds become available for use on the third bank day after payday
• You may not use money in your account to cover expenses incurred prior to April 1

All active, benefits-eligible employees enrolled in Basic Health are able to have a Health Savings Account (HSA). Funds in your HSA can be used for eligible health care, dental, and vision expenses. Funds in these accounts roll over each year and are yours to keep for future health care costs.

If you are enrolled in a Health Savings Account, you are not eligible for a Full Healthcare Flexible Spending Account, but you can enroll in a Limited and/or Dependent Daycare Flexible Spending Account to maximize your savings.

A Flexible Spending Account (FSA), makes it possible for you to pay for certain expenses on a pre-tax basis, which makes your money go farther. Refer to the FSA webpage for more information about FSAs.

After moving to Basic Health, please pay attention to emails you receive from Fidelity (the company that administers UVA’s HSAs, FSAs, and Dependent Daycare Reimbursement Accounts); you may be required to take important action to open your account.

Contributions are accepted into new HSAs the month after the account is opened by Fidelity. Sometimes Fidelity may request more information to open an account. Be sure to follow up on any requests to get your HSA opened in a timely manner.

• UVA contributes either $1,000 (employee only) or $1,500 (employee plus) once your account is opened, and the funds will show up in your Fidelity account and on your second payslip in January 2023.
• If you were hired in December, you may not have your HSA funds available until February 2023.
• Funds deposited into your Health Savings Accounts will be available to spend three bank days after the payday when they are deposited. There are two ways to spend those funds for eligible expenses:
  • Use your prepaid benefits card, the NetBenefits Access Card, at the time of purchase for eligible expenses.
  • Submit claims or make payments from your accounts online through the Fidelity website.

If you are enrolled in the Basic Health plan with HSA, you should contribute as much as you can afford, up to the annual maximum, since the HSA offers several tax advantages that make it an excellent long-term savings vehicle.

At the very minimum, you should contribute enough to cover the average out-of-pocket costs that you will likely incur over the course of the year. This strategy makes it more likely that you’ll have the funds on hand to cover the medical care you will need. And, as bonus, if you end up with extra funds at the end of the year, you get to keep that money to cover future medical expenses – including in retirement. 

                HSA funds cannot be refunded to you from your HSA account using the UVA payroll process if you contribute more than the IRS allows or if you change your mind about the amount you've already contributed. Be sure to calculate accurately when making your election. You can change the amount of your employee HSA contribution amount taken from future paychecks by changing your benefits in Workday.

Depending on your employee type, UVA may contribute money to your HSA to help offset the higher deductible.

You may choose to contribute to your HSA, though you are not required to do so. Employee contributions made by payroll are deducted before taxes. Each year, the IRS sets a contribution limit. This limit includes employer and employee contributions and is per household.

Anyone with a PO Box as their home address in Workday will have their request to open a health savings account rejected by Fidelity. It is a Patriot Act requirement to have a physical address on file before the HSA can be opened.

Please verify your contact information contains your physical address within workday during Open Enrollment.

The following address can be used:
 
2420 Old Ivy Road

Charlottesville, VA 22904-4127