The Health Investment Option with Health Savings Account (HSA)

The Health Investment Option is uniquely designed for both current-year and long-term planning for health care expenses. That’s because it combines medical coverage with a tax-advantaged Health Savings Account (HSA).

This option might be a good choice for you if:

  • You and your family tend to have low medical expenses or you are comfortable budgeting for the deductible and out-of-pocket maximum.
  • You like the idea of saving for long-term expenses beyond the current year.
  • You are looking for more opportunities to save on taxes.
  • You want to avoid paying for more coverage than you really need, and like the idea of capturing the upside potential in years of lower medical expenses.

Compare  prescription drug coverage and  out-of-pocket expenses. 

HSA Key Features

A Health Savings Account offers these key features that make it ideal for tax savings and long-term planning:

  • Both you and Fordham contribute. Fordham’s contribution depends on whether you enroll in employee-only or family coverage. You can contribute up to the annual IRS limit less Fordham’s contribution. See below.
  • Triple tax advantage. Contributions to an HSA are never taxed so long as they are used to pay for eligible health care expenses, including eligible medical, dental, and vision expenses.
    • All contributions can be made tax-free.
    • Earn money tax-free through investment or interest payments.
    • Use your account funds to pay for qualified health care expenses tax-free.
  • Unlimited growth potential. Your HSA balance is yours to keep, allowing you to save for medical expenses in retirement. Unused contributions, including Fordham’s, and any interest earnings roll over each year—and, when you retire or leave Fordham for any reason, you take your account with you.
  • Upside potential. By choosing the lower cost Health Investment Option and contributing to an HSA, you capture the financial upside in years when your expenses may be low. In contrast, if you choose the higher-cost Enhanced Standard Option, which offers a lower deductible, you’ll pay more out of your paycheck, whether or not you use the coverage.

Your HRA is administered by Discovery Benefits and you can access your account at www.discoverybenefits.com.

HSA Eligibility

According to IRS regulations, you cannot enroll in a Health Savings Account if...

  • You and your spouse are not enrolled in the Health Investment Option.
  • You and your spouse have a Health Care Flexible Spending Account (FSA) in 2020 to pay for medical expenses.
  • You are claimed as dependent on anyone else’s tax return.
  • You are enrolled in Medicare.*
    *Employees age 65+ are automatically enrolled in Medicare Part A

HSA Contributions

The IRS sets the maximum amount that can be contributed to a Health Savings Account each year. This maximum includes contributions from both employee and employer. Here are the maximum amounts for 2020. 

Under Age 55
Fordham Contribution: $750 Employee/$1,500 Family
Your Maximum Contribution: $2,800 Employee/$5,600 Family
IRS Maximum Contribution: $3,550 Employee/$7,100 Family

Age 55 and Above
Fordham Contribution: $750 Employee/$1,500 Family
Your Maximum Contribution: $3,800 Employee/$6,600 Family
IRS Maximum Contribution: $4,550 Employee/$8,100 Family

HSA or HRA?

Bottom Line

By choosing the lower cost Health Investment Option and contributing to an HSA, you capture the financial upside in years when your expenses may be low. In contrast, if you choose the higher-cost Enhanced Standard Option, which offers a lower deductible, you’ll pay more out of your paycheck—whether or not you use the coverage.