Health savings account

The Board of Pensions partners with Further to offer a health savings account for employees who enroll in the high deductible health plan medical coverage option and are not covered by any other medical plan. These accounts offer employees a tax-advantaged way to pay for healthcare expenses.

Health savings accounts are also a convenient way for employees to save for future healthcare expenses. Unused funds roll over from year to year, and the account is fully portable, so it can be used after employment ends and into retirement.

The Board urges employers that select the HDHP to offer an HSA as a way to help employees pay for the plan’s higher deductibles and save for future healthcare expenses.

Tax advantages

Employees generally make contributions to their health savings account through pretax payroll deductions. These contributions are exempt from federal income and FICA (Social Security and Medicare) taxes. For ministers of the Word and Sacrament, these contributions are also exempt from SECA taxes.

Employers also may make HSA contributions on the employee’s behalf. These contributions are not taxable to the employee.

Employees earn tax-free interest on their HSA balances, and distributions for eligible healthcare expenses are tax-free.

Eligible expenses

Employees may use funds from their health savings account to pay for qualified healthcare expenses for themselves or any family member that the employee can claim as a dependent for tax purposes, regardless of whether the family member is enrolled in the Medical Plan.

Qualified expenses are the medical, dental, and vision expenses that can be claimed as a tax deduction. Examples include, but are not limited to, deductible and coinsurance amounts, dental or orthodontia treatment not covered by dental coverage, and prescription drugs.

Eligibility to participate

If you offer the HDHP medical coverage option to your employees, the Board of Pensions urges you to also offer a health savings account. To be eligible to set up and make contributions to an HSA, the employee

• must be enrolled in the HDHP, and their employer must offer the HSA;
• cannot be covered by any other medical plan that is not an HSA-compatible health plan, including a spouse's medical plan;
• cannot typically be enrolled in a healthcare flexible spending account;
• cannot be enrolled in Medicare or TRICARE;
• cannot be eligible to be claimed as a dependent on someone else's tax return; and
• must be a U.S. resident.

Costs for employers

Employers pay $1 per employee per month for each employee who establishes an HSA. Further bills each employer directly for this monthly fee. There are no setup or other annual fees for these accounts.

Interested in offering health savings accounts?

Here's what to do next.

For current employers

If you currently offer benefits through the Benefits Plan of the Presbyterian Church (U.S.A.) and do not offer tax-advantaged accounts through the Board of Pensions, you may indicate that you are interested in offering this benefit when you update your Employer Agreement on Benefits Connect for the following year. Employer Agreements are usually available for updating July through October.

For new employers

If you do not currently offer benefits through the Benefits Plan and would like to learn more about its features and how the Board of Pensions serves employers, call our Employer Services team at 800-773-7752 (800-PRESPLAN) (TTY: 711) to discuss how we can best meet your and your employees' needs.

About Further

Further is a national leader in health savings and spending account administration. With more than $1.3 billion in assets under management, Further guides account holders across the United States in saving and spending wisely on their healthcare.