How do I qualify for a Connex HSA? Member Products & Services
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HSA Frequently Asked Questions
To be eligible for a Connex HSA, you have to have health coverage under a high-deductible health plan. By law, you cannot be covered by another health plan, unless that plan is another high-deductible plan or one that provides specific coverage such as dental or vision. Additionally, to qualify for a Connex HSA, you must not be entitled to Medicare benefits, or be claimed as a dependent on another person's tax return.
What is a High-Deductible Health Plan (HDHP)?
For 2010, a HDHP is defined as having a minimum deductible of $1,200 a year for individual coverage and $2,400 for family coverage, and an annual out-of- pocket expense maximum of $5,950 for individual coverage and $11,900 for family coverage. These limitations are subject to annual cost of living adjustments.
What about contributions?
For calendar year 2010, the limitation on deductions for an individual with self-only coverage under a high deductible health plan is $3,050. For calendar year 2010, the limitation for an individual with family coverage under a high deductible health plan is $6,150. Individuals age 55 and over may deposit into their account (and take a tax deduction on) an additional catch-up contribution of $1,000 in 2010.
What about distributions?
What's great about an HSA is that funds accumulate on a tax-deferred basis. Distributions made for qualified medical expenses are not taxable. However, the distribution of funds for reasons other than qualified medical expenses prior to age 65 is taxable and subject to a 10% penalty. It is recommended you retain all medical expense receipts.
What about dividends?
Connex provides dividend on HSA accounts. Connex calculates dividend during the course of a month, and credits dividend to accounts at the beginning of the next month. HSA funds are NCUA insured.
How are HSAs reported?
Connex provides a monthly statement that summarizes your account contributions and disbursements for each individual HSA. To assist with year-end tax preparation, Connex sends required forms annually to you and the IRS.
What are qualified medical expenses?
Your HSA can be used to pay for medical expenses that apply toward your deductible. Additionally, you can pay for qualified medical expenses that your health plan doesn't cover. For a complete list of qualified medical expenses, please visit the IRS website at www.irs.gov and enter the number "502" in the "search box" on the home page.
Can I write checks from my HSA account?
You will receive checks in 7-10 business days. To cover the cost of processing, there is an $8.95 charge for every book of checks ordered.
Are there any setup fees or monthly maintenance fees on the HSA Account?
No, there are no setup or maintenance fees with the HSA Account.
Are there any forms I need to file to be reimbursed for medical expenses?
No. You pay for medical expenses with your cash withdrawal, or by writing a check.
What happens if I don't spend all the funds in my HSA by the end of the year?
Unused funds rollover from year to year.
How do I contribute funds to my HSA in addition to my monthly contribution?
You will be mailed deposit coupons once your HSA is established. Simply mail your check and coupon to Connex at the address provided, make a deposit at any branch or have your money deducted from your payroll (check with your employer).
What happens if I contribute too much to my HSA, and exceed my High-Deductible Health Plan (HDHP) deductible?
The IRS imposes a penalty on excess contributions, but allows, under certain circumstances, for corrective distributions to be made. Additionally, you would be required to pay tax on the interest earned on those excess funds.
Are there any tax forms that I need to use in preparing my taxes at year-end?
Yes. Similar to IRAs, each January you will be sent a 1099 Form for any distributions made from the HSA during the calendar year. If the contributions were made by you or your employer through an employer plan, those contributions will be reported on your W-2 issued by your employer.
What happens if I'm no longer participating in a High-Deductible Health Plan (HDHP)?
You can continue to spend any funds in your HSA to pay for qualified medical expenses. However, you can no longer contribute to your HSA.
How can I check the balance of my HSA?
You can view the balance of your HSA through Online Banking, or by calling 1-800-CR-UNION to access Call24.
What if I need assistance or have questions about my HSA?
Call the Connex Member Service Center at 1-800-CR-UNION, Monday - Friday, 8 a.m. to 4 p.m. (EST).
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