Employer Administration Guide 1
Contents Welcome...3 HSA Fees and Rates...4 USA PATRIOT Act Screening...5 HSA Contribution Limits...6 Frequently Asked Questions...7 Contact Us...9 2
Welcome BenefitWallet makes it easy for you to offer and manage Health Savings Accounts (HSAs) for your employees. From providing educational tools and resources to day-to-day employer and member support, we ve got you covered. HSA Overview An HSA combines a Qualified High Deductible Health Plan (QHDHP) with a tax-free savings account. You and/or your employees can fund this account by making pre-tax contributions up to the IRS maximum limits. The money can then be used to pay for qualified medical expenses or accumulated for future expenses. Once your employees are established as BenefitWallet account holders, they will receive a debit card and optional checkbook, which they can use to access their HSA funds. Employees can access the member portal at mybenefitwallet.com which provides secure access to educational materials, FAQs, detailed investment information, online claim submission, and interactive expense and savings calculators. Support Resources A variety of resources are available to assist you throughout initial and ongoing phases of your HSA implementation: Employer website: Receive 24-hour access to a dedicated website with account and funding information. Onboarding support: During your implementation process, a BenefitWallet onboarding specialist will contact you to schedule a training webinar to answer questions and show you how to use the BenefitWallet employer portal. Online contributions: Set up and make recurring contributions to your employees HSA accounts online. Ongoing assistance: For assistance with enrollment, funding, and other issues requiring support, please send us an email or call the Employer Support team (see the Contact Us section). 3
HSA Fees and Rates Like checking accounts with any bank, there are some fees associated with maintaining HSAs. BenefitWallet gives employers the option to cover the monthly administration fees for their employees, or to have the fees deducted monthly from their employees account balance. While this is a choice that a new group needs to make during the group setup process, it is a decision that can be changed at a later date. For example, a group offering a QHDHP with HSA for the first time may want to absorb the maintenance fees for the first year for all employees who open an HSA, then make a change in the second year where members cover the fee moving forward. Since members with balances over $1,000 do not pay maintenance fees, this could be used as an incentive for members to build up their balances to kickstart their long-term saving habit while helping them reduce their tax burden. For groups that want to cover monthly maintenance fees for only their activelyemployed members, and do not want to pay them for other members on their plan such as COBRA-enrollees or retirees, we do have ways to make that possible as well. Some other occasional fees such as for multiple replacement debit cards or additional checkbooks are deducted only from employees accounts. HSA Fees and Rates (subject to change) Account set-up fee Monthly service charge if employee pays maintenance fees and monthly account balance is under $1,000 Monthly service charge if employer pays maintenance fees, regardless of balance Transaction fees for debit card and check transactions None $3.50 $2.25 None Transaction fees for ATM transactions $2.00 Monthly paper statement fee $1.25 Monthly service charge to employees for an HSA investment account $2.90 Market-based interest rate Variable 4
USA PATRIOT Act Screening The USA PATRIOT Act was established by the Federal Government after September 2001 to help fight the funding of terrorism and money-laundering activities. It requires all financial institutions to obtain, verify and record information that identifies individuals and entities that engage in any financial transactions with or through the bank; this includes HSA accounts. Individuals may be required to submit additional paperwork related to the USA PATRIOT Act to complete this verification process. Should any of your employees accounts be identified, they should comply with the request and provide copies of the documentation indicated within the letter. Please make your employees aware of the USA PATRIOT Act requirements and their need to comply with any request for information to avoid unnecessary account closures. Your attention to providing accurate Social Security Numbers, name spellings and dates of birth on your enrollment file are also an important part of the USA PATRIOT Act screening process. Two requests will be sent from BenefitWallet. Employees will have 10 days to return the pre-paid envelope with the requested information or upload the document images to our secure website or mobile app. Information must be returned according to the instructions provided in the request. If employees do not respond to the request, their HSA will be closed. Acceptable Documentation For an Address Validation: A driver s license, state identification, bank statement, or a current phone or utility bill displaying the input address. Note: You must use your residential address, not a P.O. Box. For a Social Security Number (SSN): A social security card. For Date of Birth: A driver s license, U.S. passport, birth certificate, or state identification. For Name Validation: A social security card, passport, birth certificate, marriage certificate, divorce decree, legal name change certificate or state identification. How to Submit Documentation Documentation can uploaded to our secure website or mobile app or mailed to: BenefitWallet C/O BNY Mellon-CIP department 500 Ross St, AIM 154-0510 Pittsburgh PA 15262 5
HSA Contribution Limits As an employer, you and/or your employee can contribute funds into your employees HSAs so long as the total contributions do not exceed the limits set by the IRS. IRS HSA Limits 2018 2019 Change from 2018 HSA Contribution Limits: Individual Coverage $3,450* $3,500* + $50 Family Coverage $6,900 $7,000 + $100 HDHP Minimum Required Deductibles: Individual Coverage $1,350 $1,350 No change Family Coverage $2,700 $2,700 No change HDHP Out-of-Pocket Maximum: Individual Coverage $6,650 $6,750 + $100 Family Coverage $13,300 $13,500 + $200 * Persons age 55 or older may make additional catch-up contributions of up to $1,000. Contribution Reminders HSA owners are responsible for ensuring that they do not contribute more than they are allowed under IRS rules. Prior year contributions can be submitted by employers or employees between January 1 and April 15 each year. If your employees withdraw funds before age 65 for nonqualified medical expenses, regular income tax plus a penalty will apply. Once an employee reaches and maintains $1,000 in their HSA, they can invest in a wide variety of mutual funds. 6
Frequently Asked Questions As an employer, do I own my employees Health Savings Accounts (HSAs)? Can I control how they spend the money in them? No, you do not own your employees HSAs. The employee fully owns and controls the contributions to the account as soon as they are deposited, just as with a personal checking or savings account to which you would deposit their compensation. My employees want to contribute to their HSAs but want to make sure they get a tax benefit for doing so. How does that work? Employee contributions can be made to HSAs on either a pre-tax or after-tax basis. If they want to make the contribution pre-tax, it can be done through a Section 125 plan (also called a cafeteria plan ) via payroll deductions. If made on an after-tax basis, they should be counted as an above-the-line deduction on their tax return, effectively making their contributions tax-free. How much do I have to contribute to my employees HSA as an employer? There is no minimum contribution amount for employers. Contributions cannot exceed the annual IRS limits, which includes both employer and employee contributions. Annual limits are released by the IRS and United States Treasury. As an employer, do I have to contribute the same amount to every employee s HSA? No, you can make different contributions based on classes of employees. For example, you can vary the level of contributions for full-time vs. part-time employees, and employees with single vs. family coverage. Also, employees who do not have coverage through a QHDHP are not eligible to receive HSA contributions. Our company offers benefits through a Section 125 plan. Do contributions have to be comparable under these plans as well? Section 125 plans (also known as salary reduction or cafeteria plans) must meet a different set of rules. Under these plans, contributions (both from the employer and/ or employee) must meet nondiscrimination rules. These rules require the employer to ensure that contributions do not favor higher-compensated employees. Our company wants to offer matching contributions. Can we do that? Yes, but your company can only offer matching contributions through a Section 125 plan. Remember that nondiscrimination rules still apply. Do HSA contributions have to be made in equal amounts each month? No, you can contribute in a lump sum or in any amounts or frequency you wish. However, keep in mind that the funds belong to the employee after they are deposited. 7
Frequently Asked Questions Who may contribute to an HSA? Contributions to HSAs may be made by individuals who: Are covered by an IRS-qualified HDHP Are not covered by other health insurance Are not claimed as a dependent on someone else s tax return Are not enrolled in Medicare Members who are eligible for Medicare but have not filed an application for either Social Security retirement benefits or Medicare, can continue to contribute to their HSA after age 65 and postpone applying for Social Security and Medicare until they stop working. There is no penalty for this delay. How are contributions treated for owners and shareholders of S corporations? Owners and officers with greater than two percent share of a Subchapter S corporation cannot make pre-tax contributions to their HSAs through the company by salary reduction. In addition, any contributions made to their HSAs by the corporation are taxable as income. However, they can make their own personal contributions to their HSAs and take the above-the-line deduction on their personal income taxes. How are contributions treated for partners in a partnership or limited liability company (LLC)? Partners in a partnership or LLC cannot make pre-tax contributions to their HSAs through the partnership by salary reduction. However, they can make their own personal contributions to their HSAs and take the above-the-line deduction on their personal income taxes. May a self-employed person contribute to an HSA on a pre-tax basis? No. Self-employed persons may not contribute to an HSA on a pre-tax basis and may not take the amount of their HSA contribution as a deduction for Self Employment Contributions Act (SECA) purposes. However, they may contribute to an HSA with after-tax dollars and take the above-the-line deduction. Can I be notified if one of my employees doesn t pass the USA PATRIOT Act? Yes, you may set alerts in the employer portal by going to Manage Notifications, clicking Alerts, and then checking the Pending Close Letter Sent box. 8
Contact Us Employer Support Team Phone: 866.712.4551 Hours of Operation (Eastern Time) Monday Friday: 8:00 a.m. 8:00 p.m. Saturday & Sunday: 9:00 a.m. 6:00 p.m. BenefitWallet Service Center Phone: 877.472.4200 Hours of Operation (Eastern Time) Monday Friday: 8:00 a.m. 11:00 p.m. Saturday & Sunday: 9:00 a.m. 6:00 p.m. Holidays The following are bank and/or market holidays. For a bank holiday, no payroll will post on these days. For a market holiday, no investment transaction (investment or redemption) will post on these days. For a day that is both a bank and market holiday, neither payroll nor investment transactions will post. Date Holiday BenefitWallet Holiday Bank Holiday Market Holiday Tuesday, January 1, 2019 New Year's Day x x x Monday, January 21, 2019 Martin Luther King Day x x Monday, February 18, 2019 President's Day x x Friday, April 19, 2019 Good Friday x Monday, May 27, 2019 Memorial Day x x x Thursday, July 4, 2019 Independence Day x x x Monday, September 2, 2019 Labor Day x x x Monday, October 14, 2019 Columbus Day x Monday, November 11, 2019 Veteran's Day x Thursday, November 28, 2019 Thanksgiving Day x x x Friday, November 29, 2019 Day After Thanksgiving Market Closes 1:00 p.m. ET Wednesday, December 25, 2019 Christmas Day x x x Wednesday, January 1, 2020 New Year's Day x x Market Closes 1:00 p.m. ET BenefitWallet 2019 Conduent Employer Business Services, Administration LLC. All rights Guide reserved. Conduent, Conduent Agile Star and BenefitWallet are trademarks of Conduent Business Services, LLC in the United States. HSA-E-3060-1218 9