What is an HSA?
An HSA is a type of savings account that lets you set aside pre-tax dollars to later be used towards qualified medical expenses. You can elect to contribute to an HSA if you are enrolled in a qualified HDHP and can only contribute up to the IRS limits each year.
What are the advantages of an HSA?
Any unused funds you contribute to an HSA is yours to keep! These funds rollover year after year. You can take these funds with you if you leave Trusted Health or change health plans. Your HSA can also double as a retirement account as unused funds can be invested.
When you elect to contribute to an HSA, those contributions are deducted from your paycheck before taxes are taken out. This brings down your taxable income and you are therefore taxed on less earnings. However, you still retain this money, just in a separate savings account, to be used towards qualified medical expenses.
How do I enroll in an HSA?
You are automatically enrolled upon enrolling in an HDHP medical plan. However, you do not have to contribute.
How do I contribute?
After enrollment, a federal verification process is required before contributions can be made. A letter is sent regarding next steps to complete account verification, including guidance on the personal documentation that needs to be provided. This can be uploaded through the Anthem member portal.
Some accounts fail this process and therefore members are required to submit additional information to validate their identity. If documentation is not received within 90 days, Anthem will close the account and no contributions can be received.
Contribution amounts can be elected directly within ADP by navigating to Myself > Pay > Direct Deposit. These contribution amounts can also be updated at anytime.
How much can I contribute to an HSA?
You can contribute up to $4,300 annually in 2025 if you elect employee-only coverage. If you elect coverage for yourself and dependents, you can contribute up to $8,550 annually. During open enrollment, you will elect an annual amount you wish to contribute towards your HSA. This amount will be deducted on a per-pay-period basis. You can make changes to your HSA election anytime throughout the year.
What to know about contributing to a Health Savings Account
You can only contribute to a Health Savings Account if you are enrolled in a qualified High Deductible Health Plan and are not enrolled in any other disqualifying coverage. You cannot contribute to a Health Savings Account if:
- You are enrolled in the Anthem PPO
- You are also enrolled in a spouse’s medical plan that is not a qualified HDHP
- You are enrolled in Medicare
- Your spouse is enrolled in a Healthcare FSA
You can use the funds available in your HSA towards qualified expenses. If you have any funds remaining in your HSA at year-end these funds will automatically carryover into the next year – there is no risk of forfeiture. If you leave Trusted Health, your HSA stays with you. You will still retain access to these funds and can transfer funds to another HSA administrator. If you later enroll in a non-HDHP and can no longer contribute towards an HSA, you can still use remaining funds towards qualified expenses.
If you’re not using your savings to cover healthcare expenses, you can also invest your HSA funds. Should you need to move your invested funds back to your HSA for healthcare use, you have the option to liquidate some or all of your invested funds as needed.
How do I use my HSA to pay for expenses?
You can use available funds towards eligible health care expenses that are incurred after you establish your HSA. This can include things like:
· Covered services on the medical plan
· Prescription & over-the-counter medication
· Dental care like orthodontia
· Vision care like eyeglasses & Lasik eye surgery
· Medical equipment
· Chiropractic & Acupuncture
When you incur an eligible health care expense, you can use your HSA debit card to pay for these expenses if you have sufficient funds available. You can also pay out-of-pocket and reimburse yourself by submitting a claim through the Sydney Health mobile app or Anthem portal. If you incur an expense but do not yet have sufficient funds to cover, you can pay out-of-pocket and later reimburse yourself once your account has accrued enough funds.
IMPORTANT: Make sure you retain all receipts and EOBs (if applicable) as they may be required to approve the claim.
Can I use HSA funds towards my dependent’s expenses?
You can use funds to pay for qualified expenses for eligible dependents, even if they are not enrolled on your medical plan as long as their expenses are not otherwise reimbursed.
If you have a domestic partner and they are enrolled as a dependent on your HDHP, you are eligible to contribute up to the family contribution limit. Your HSA funds, however, cannot be used towards their healthcare expenses unless they are a tax dependent.
How do I invest my HSA funds?
After your HSA balance reaches $1,000, you can invest anything over that amount. Your contributions will grow tax-free and can help you pay for future medical expenses. You can view your investment options and start investing through the Sydney Health mobile app or Anthem portal and go to Spending Accounts.
What are the tax considerations with an HSA?
HSAs are not subject to federal income tax however certain states do tax employer contributions as income. You will not be taxed when using the funds in your HSA as long as those funds are used towards qualified healthcare expenses. Any interest or earnings on the assets in the HSA are tax-free while held in the account. Withdrawals are also tax free as long as funds are used towards qualified expenses.
Funds used towards non-qualified expenses are taxed as income. If you are younger than 65 – you will also incur an additional 20% penalty when using these funds towards non-qualified expenses.
What happens to my HSA if I am between contracts?
All funds contributed to this account are yours. Following your contract end date, your HSA will turn into a retail account within 2 weeks and you will be responsible for account administration fees starting at the end of the month. You will receive a new non-Anthem branded debit card to be used while you are in between contracts but you should hold on to your prior Anthem debit card.
The retail account is managed by Wealthcare Saver
Hours of Operation: M-F 8am-8pm EST
Phone: 866-287-2520
NOTE: Generic Wealthcare Saver Letters are attached at the bottom of this page for reference
If you start a new contract, your account will automatically revert back into an employer-sponsored account and you will not incur additional administration fees. Your prior Anthem debit card will reactivate and unused funds will continue to be available for qualified expenses.
If you are no longer enrolled in a HDHP between or after your contract, you can still use available funds in your HSA towards qualified expenses.
Can HSA funds be transferred?
If you were contributing to another HSA from a prior employer, you can transfer remaining funds in that account to your Anthem HSA. Contact Anthem to request this transfer.
If you leave Trusted Health and would like to transfer your HSA funds to another account, you can do so by contacting the new HSA’s administrator.
NOTE: Funds from the transferred account will be temporarily unavailable during the transfer process.