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HSA Information

Graphic Large ShipYour HSA and Qualified Medical Expenses
HSA money can pay for any “qualified medical expenses” permitted under federal tax law. This includes most medical, dental, vision and chiropractic care, etc.

HSA money can pay medical expenses for yourself, your spouse, or your dependent children even if your spouse and dependents are not covered by your HDHP!

Your HSA and Non-Qualified Medical Expenses
Payments for services other than “qualified medical expenses” are taxable as income and subject to an additional 20% tax penalty, except after age 65 when the penalty no longer applies. Examples of taxable income include:
•  Medical expenses not considered “qualified medical expenses” (i.e. cosmetic surgery).
•  Other types of health insurance unless specifically described above.
•  Medicare supplement insurance premiums.
•  Expenses that are not medical or health-related.

High Deductible Health Plans for Your HSA
To open and contribute to an HSA you must have coverage under an HSA qualified “High Deductible Health Plan” (HDHP). Federal law requires a health insurance deductible for 2012 of at least $1,200 (self-only) and $2,400 (family). Maximum HSA contributions for 2012 are $3,100 (self-only) and $6,250 (family).

In addition, annual out-of-pocket expenses under the plan for 2012 (including deductibles, co-pays, and co-insurance) cannot exceed $6,050 (self-only) and $12,100 (family). For a copy of Revenue Procedure 2011-32, please click here.

The deductible must apply to all medical expenses (including prescriptions) covered by the plan. However, plans can pay “preventive care” services on a first-dollar basis (with or without a co-pay). "Preventive care" can include routine pre-natal and well-child care, child and adult immunizations, annual physicals, mammograms, pap smears, etc.

Contributions can be made up to tax day (April 15) of the following year. Individuals age 55 and older can also make additional "catch-up" contributions. Current Kereon HSA customers must have their money sent to us by the 10th of April in order for us to post this money to your account by the 15th.

HSA and Premiums
You cannot use an HSA to pay medical insurance premiums, except under specific circumstances, including:
•  Health plan coverage while receiving federal or state unemployment benefits.
•  COBRA continuation after leaving a company that offers health insurance.
•  Qualified long-term care insurance.
•  Medicare premiums and out-of-pocket expenses, including deductibles, co-pays, and coinsurance for: Part A (hospital), Part B (physician and outpatient), Part C (HMO's and PPO's) and Part D (prescription drugs).


Forms to Download

HSA Basics
HSA Notice
HSA Road Rules
All About HSAs

HSA Contributions for 2012

The out-of-pocket maximums are:
2012 Minimum HSA deductibles of $1,200 self-only and $2,400 family.
2012 Maximum HSA contributions of $3,100 self-only and $6,250 family.
2012 Maximum HSA out of pocket expenses of $6,050 self-only and $12,100 family.


HSA Benefits

  • Tax free contributions

  • Tax free distributions

  • Tax free interest earned

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