Health Care Savings Account (HSA) FAQs

There are many benefits to an HSA.

• Each pay period NAU contributes your account!
• You can make pre-tax contribution.
• You can pay for qualified expenses tax free.
• Unused funds rollover year to year.
• Your account is yours and goes with you if you leave NAU.

That depends on the HDHP you are enrolled in.

• If you are enrolled in the NAU HDHP Health Equity will administer your HSA.
• If you are enrolled in the State of AZ HDHP Optum will administer your HSA.

The funds in your account remain your and you can use then to cover future healthcare expenses. Your administrator will charge you a monthly fee.  If you enroll in another employer’s HDHP with an HSA you may be able to transfer your fund to your new HSA.

Since you are no longer enrolled in a qualifying HDHP you will not be able to make future contributions to your HSA account

The funds in your account remain your and you can use then to cover future healthcare expenses.  Your administrator will charge you a monthly fee.

If you are married, your spouse will become the owner of the account and assume it as their own HSA. The money in the account will pass to your beneficiaries or become part of your estate, and it will become subject to applicable taxes.

Anyone can enroll in the HDHP but there are limitations and who participant in the Health Care Savings Account. To contribute to an HSA, the IRS requires you:

• Must be enrolled in a Qualified HDHP, such as the new NAU BCBSAZ HDHP or the State HDHP
• Cannot be covered by Health Coverage that is not Qualified (includes spousal FSA, Medicare, Tricare, IHS or a traditional health plan)
• Cannot be enrolled in Medicare A or B
• Cannot be a dependent on someone else’s tax return
• Cannot use the VA for a non-service related injury.

Note: Since you are the account holder these limitations apply to you not your dependents.

Yes. Merely being eligible for to receive care does not affect your HSA eligibility. However, receiving certain services can make you ineligible to receive or make contributions to your HSA and lowers the annual amount you can contribute your HSA.

Per the IRS Notice 2012-14,

‘an individual who is eligible to receive medical services at an IHS facility, but who has not actually received such services during the previous three months, is an eligible individual within the meaning of § 223(c)(1) of the Internal Revenue Code who may establish and make tax-free contributions to an HSA. However, an individual generally is not an eligible individual if the individual has received medical services at an IHS facility at any time during the previous three months.’

If you receive IHS services that would make you ineligible for HSA contributions and it is your responsibility to contact Human Resources to stop NAU’s and your HSA contributions.

For more information

• Visit the IRS website at https://www.plansponsor.com/irs-provides-guidance-on-hsas-for-users-of-indian-health-service/
• Review page 39 of Health Equity’s HSA Guidebook
• Contact your tax advisor

For 2024, the IRS set an annual contribution limit of $4,150 for individual coverage and $8,300 for family coverage. If you are age 55 or older you can contribute an additional $1,000 each year. Contributions made by you, NAU and family members to any HSA all count toward the IRS limit.

Note: You as the primary account must be age 55 even if your spouse is not of that age.

Most contributions are made through payroll deduction but you can also make contributions directly to your HSA administrator. Keep in mind that if you make direction contributions NAU will not have record of those contribution and you could exceed the annual IRS maximum.

Yes, you can change your contribution throughout the year as long as you do not exceed the IRS maximum for that year. You will need to fill out the contribution change form from the Human Resources Policies and Forms page and submit to the Benefits Team at nauhrbenefits@nau.edu.

If you contribute more than the IRS annual contribution maximum, you have until the tax-filing deadline to withdrawal excess contributions. If excess contributions are not withdrawn by the deadline line, an annually assessed excise tax of 6% will be imposed on any excess contributions.

While you can no longer contribute to your HSA, you can still use the remaining funds in our HSA for qualified medical expenses.

You can use funds in your HSA to pay for qualified medical expense like:

• Doctor office visits, lab fees and medical procedures
• Dental care, including extractions and braces
• Vision care, including contact lenses, prescriptions sunglasses and LASIK surgery
• Prescription medications and over the counter treatments

Refer to IRS publication 969 for a complete list of eligible expenses and HSA rules.

No, unfortunately you can only request to be reimbursed, or to pay medical expenses with the funds available in the current balance. The other thing to keep in mind is that there is no time limit with an HSA to reimburse yourself for qualified medical expenses that you pay out-of-pocket. You can accumulate the reimbursable amount until you reach a determined goal while building tax-free earnings.

No. Only expenses incurred after the date the HSA is effective are qualified.

The HSA funds can only be used for tax dependents.  So, if you can claim a dependent on your taxes you can use your HSA funds their covered health care expenses.

In general, no, but exceptions include: qualified long-term care insurance, COBRA continuation coverage, and health plan maintained while receiving state or federal unemployment compensation.

If you are over age 65, qualified medical expenses can include: employer-sponsored retiree medical premiums for medical Part A or B or a Medicare HMO.  Premiums for Medigap policies are not qualified medical expenses.

No, you can reimburse yourself at any time for expenses you paid for out-of-pocket. There is no time limit, but the expenses must have been incurred since you opened your HSA. You should keep your itemized receipts in case of an IRS audit.

Yes. However, any amount distributed that is not used exclusively to pay for qualified medical expenses for you, your spouse or your eligible tax dependent should be included in your gross income. These distributions are subject to taxes and an additional 20% tax penalty, except in the case of distributions made after your death, disability or reaching age 65.

It is a health care plan that satisfies certain IRS requirements. For 2023, at least $1,500 in deductibles for individual coverage and $3,000 for family coverage. For more details refer to IRS publication 969.

You can see Campus Health Services (CHS) providers, but you will need to meet your deductible before eligible expenses are paid by the plan. As CHS charges are generally lower than those of community providers, this can help reduce your out-of-pocket expenses.

There are several differences.

Yes, but there are limitations. If you are enrolled in an HSA, you can also make contributions to a ‘Limited Purpose FSA.” You can only pay for Dental and Vision expenses with a ‘Limited Purpose FSA.”  Medical expenses would need to be paid out of your HSA.