HSA/HRA

You have the option to make tax-free contributions to your account, provided the total contributions do not exceed the limits established by law. If you are over 55, you can make an additional "catch up" contribution. You can use funds in your account to help pay your health plan deductible. However, if you enroll in a HDHP with a HSA, you are not eligible to participate in a Health Care Flexible Spending account.

Features of an HSA include:

• Tax-deductible deposits you make to the HSA.
• Tax-deferred interest earned on the account.
• Tax-free withdrawals for qualified medical expenses.
• Carryover of unused funds and interest from year to year.
• Portability; the account is owned by you and is yours to keep - even when you retire.
• Tax Relief and Health Care Act of 2006 Focus: HSAs

On December 20, 2006, President Bush signed into law H.R. 6111. This legislation includes key expansion of HSA provisions, including:

1. Save as much as $2850 for single coverage and $5650 for family coverage in your HSA account even if your policy’s deductible is less.
2. Contribute the full maximum amount to your HSA regardless of what time of year you sign up for the plan.
3. Roll funds from your FSA or HRA into your HSA.
4. Make a one-time contribution from your IRA to your HSA (up to the maximum HSA contribution for that year).

Contact your ENV account representative to further discuss how these provisions may affect your group.

Health Reimbursement Arrangement (HRA)

For members who are not eligible for an HSA, have Medicare or another non-High Deductible Health Plan, the HDHP will provide and administer a Health Reimbursement Arrangement.

The plan will credit the HRA different amounts depending on whether you have a Self Only or a Self and Family enrollment. You can use funds in your account to help pay your health plan deductible.

Features of an HRA include:

• Tax-free withdrawals for qualified medical expenses.
• Carryover of unused credits from year to year.
• Credits in an HRA do not earn interest.
• Credits in the HRA are forfeited if you leave federal employment or switch health insurance plans.