*Aetna is available for phone appointments on Tuesdays. Contact Ting Shih-Okawachi at (607) 255-7508 in Benefit Services to schedule an appointment.
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HSA Summary Plan Description:
What is Cornell’s Health Savings Account Plan?
The Health Savings Account (HSA) option is a comprehensive health care plan. There are two components:
1) An underlying Aetna high deductible insurance plan (a deductible is the money you pay upfront before your insurance kicks in)
|2015||In-Network Deductible||Out-of-Network Deductible|
2) A Health Savings Account (HSA) you can use the account to pay your health care costs. Or pay those costs out of your own pocket and let your account grow by earning interest.
A Health Savings Account is similar to the Aetna PPO and Cornell Program for Healthy Living (CPHL) plans. You are encouraged to use a nationwide panel of preferred providers that Aetna maintains. Using in-network providers will result in lower health care costs than using providers who are out of network. However, the HSA has some important differences:
Why Do I have to Use a High Deductible Health Insurance Plan?
All HSAs are required by law to combine the savings account with high deductible health insurance.
How does a Health Savings Account work?
Once enrolled in the plan, you have Aetna high deductible health insurance. You are allowed to deposit up to $3,350for singles or $6,650 for families into your tax-free Health Savings Account to earn interest and put toward future medical expenses. Cornell contributes $1,000 up front towards your limit if you enroll during open enrollment; otherwise, the amount is pro-rated if you join the plan after January 1.
You can use the health savings account to pay for your health insurance deductible and any qualified medical expenses including those not covered by the high deductible include like dental and vision care. You can pay with your PayFlex debit card (this draws money from your HSA account) or pay out of pocket instead. But you must pay for services until the deductible is met.
Note: Qualified costs that were incurred before the date your HSA is established cannot be reimbursed from the account.
Is the Health Savings Account right for me?
This is a personal decision and there are pros and cons to consider. The health plan part of this model requires you to meet the deductible before the health plan begins to share the cost of your medical care. You should have the discretionary income available to meet the in-network deductible ($1,500 for individual or $3,000 for family) or you should be prepared to use the balance in your HSA fund instead. If you use the HSA to fund your deductible, that limits the growth in this tax-advantaged savings account. One of the main attractions of the HSA plan is the tax-advantaged growth available to you in the HSA fund. So, you can see that this plan requires some strategic planning on your part to optimize the benefits for you and any covered family members. In the end, however, you are still protected by a comprehensive medical plan, especially for catastrophic coverage if ever needed.
How does a typical doctor office visit work?
When you go to your in-network doctor for a sick visit (beyond preventive care), your share of the cost is based on a negotiated rate. Your doctor’s office will send the claim to Aetna for payment.
However, given the nature of your health plan, some offices may require you to pay for some or all of the cost at the time of your visit. If you have a sufficient balance in your HSA fund, you can use your PayFlex debit card to cover the costs of the treatment. Or, your doctor may be willing to send you a bill after Aetna adjudicates the claim. In any case, you will need to pay your share of the bill.
After the deductible is met, you pay only the part of the cost each time you visit the doctor or medical provider. Once you have met the annual out of pocket maximum, the plan reimburses at 100% for the rest of the calendar year. Aetna provides online tools through Aetna Navigator to keep track of what you have paid. PayFlex administers the health savings account.
Once you meet the deductible, you pay for only part of the cost each time you visit a doctor or hospital. For in-network services, the plan reimburses at 90% and you pay 10% for medical care that is not preventive (for out of network services you pay more). Once the amount you have paid reaches the out of pocket maximum for the calendar year, the plan reimburses at 100%.
How do I access the funds in my health savings account?
With PayFlex, you have three ways to access your HSA funds:
Is the preventive medical care subject to the deductible?
Preventive care is usually covered in full after the copay and it does not count toward your deductible. Services may include: routine exams and shots, wellness exams for children and women, routine mammograms.
How much can be contributed to the HSA?
|2015||Your Contribution||Cornell's Contribution||Total Maximum Contribution|
|Individual||Up to $2,350||$1,000||$3,350|
|Family||Up to $5,650||$1,000||$6,650|
Employees age 55 or older may make a catch-up contribution set for $1,000 in 2015. Contribution amounts are set by the IRS each year.
Annual Contribution with Catch Up Provision*
Catch Up Contribution
|Cornell's Contribution||Your Total Maximum Contribution|
|Individual||Up to $2,350||Up to $1,000||$1,000||$3,500|
|Family||Up to $6,650||Up to $1,000||$1,000||$7,650|
*Please note: For enrollments outside of the November annual open enrollment period, Cornell's $1,000 contribution is pro-rated based on the enrollment effective date.
How is the contribution limit determined?
Contribution amounts are set by the IRS each year.
When you pay medical expenses from your HSA account, how does Aetna know when you have paid your deductible?
If you use an in-network provider, the doctor’s office will file your claim with Aetna for you. This will ensure you receive the discounted PPO price. You could also save the bills and submit them to Aetna yourself.
What happens if there isn’t enough money in my HSA when I need to pay for qualified medical expenses?
If you use your PayFlex debit card to pay for qualified medical expenses and there is not enough money in the account to cover the cost, your transaction will be denied and you may incur a denial fee.
Are prescriptions drugs covered under the Aetna HSA?
Yes, the HSA includes coverage for prescription drugs through Express Scripts as part of your HSA Plan. Drugs that are considered preventive by Express Scripts and the IRS are not subject to the deductible. You pay the copay. Drugs that are not preventive in nature are applied to the deductible.
What happens if I enroll in the HSA any time after January 1? This typically applies to new employees.
Cornell will contribute $1,000 which is pro-rated based on the effective date. The pro-rated amount is deposited up front into your PayFlex bank account. If you enroll after January 1, your contribution will be pro-rated based on the number of pay periods remaining in the year. Example: If you enroll mid-year with 13 pays remaining out of 24 for the year, the amount Cornell contributes up front will look like the following:
You can also make contributions. They work differently and are not prorated. But the total amount you wish to contribute is spread out of the remaining pay periods.
What else do I need to know if enrolling outside of the Annual Open Enrollment Period?
If you enroll outside of the annual open enrollment, according to the IRS, you are required to remain in the plan for the next year if you submitted a full years maximum contribution in less than a full year. If you do NOT stay in the plan for the full year, the amount you contributed is considered taxable gross income during the next year, with an additional 10% tax penalty. We recommend that you consult your tax advisor regarding your specific situation.
Example: You enroll effective July 1, 2015 and submit the maximum $3,350 for 2015. In 2015, you leave the plan sometime before 12/31/15. $1,650.00 of your 2015 contribution is considered taxable income *and* has the additional 10% penalty applied. ($3,350/12 = $279.17 per month x 6 months = $1,675.02)
What can you use HSA funds for?
The funds in your HSA account belong to you. They can be withdrawn at any time and for any reason. But if funds are withdrawn for any purpose other than a qualified medical expense, by someone under the age of 65, the amount withdrawn is taxable and subject to a 10% penalty. There is no penalty for non-qualified withdrawals after age 65 although the amounts are taxable.
Does Aetna/PayFlex withdraw my HSA funds or keep track of them?
No. It is your responsibility to keep track of your own medical expenses. Individual contributions and taxable distributions should be reported on your Form 1040 tax filing.
How do I know what medical expenses are qualified?
Qualified medical expenses are expenses for medical care, generally as described in detail in Section 213(d) of the Internal Revenue Service Tax Code and IRS Publication 502. You must be sure that you have not been otherwise compensated or reimbursed by insurance for the treatment. For help from the IRS, call 1-800-829-3676 or visit the IRS website.
Examples of qualified medical expenses include medical fees and deductibles at doctors’ offices, pharmacies, dentists, vision centers, medical labs and much more — including many treatments and medical supplies that traditional healthcare plans do not cover. Visit Aetna Navigator, for general information about qualified and non-qualified medical expenses. Aetna Navigator provides you with the access to PayFlex (the HSA administrator). Or you can choose to go directly to the PayFlex website. Use the Medical Expense Tracker to help organize them online. Make sure you keep your receipts so you can document for the IRS the appropriate use of these funds.
Do I pay for the full doctor’s office visit when I go to the doctor?
You are responsible to pay the amount Aetna contracted to pay your doctor (typically at a discounted rate), until your deductible is met. You can use your HSA to pay for these expenses. In 2015, the individual deductible is $1,500 in-network or $3,000 out-of-network. The family coverage deductible is $3,000 in-network and $6,000 out-of-network.
It’s best to have you doctor’s office put the change through to your insurance, so that you receive credit toward your deductible and know exactly what to pay. Some doctors may require that you pay up front, but most bill your insurance, and then bill you only once the claim has been processed. Make sure you don’t pay more than your portion shown on the explanation of benefits you receive from Aetna.
We encourage you to speak with your tax advisor or accountant and Benefit Services before enrolling in the Health Savings Account. Because the HSA is regulated by the IRS, there will be additional steps involved in your tax preparation. The information provided by Cornell does not constitute legal advice.