HSA – Health Savings Account
Blue by Design HSA is a special tax-exempt trust or custodial
account created by the Medicare Prescription Drug and Modernization
Act in December 2003. The act allows eligible medical expenses
to be paid for with pre-tax dollars. An HSA works together
with a qualifying high-deductible health plan, giving the employee
more control over his or her health care decisions.
Who is Eligible?
Any "eligible individual" can establish an HSA. The Internal Revenue
Code, Section 223, defines who is eligible to participate in a Health Savings
Account (HSA), and state law defines who is eligible for a high-deductible
health plan (HDHP). BCBSKS will enroll an individual in a qualifying high-deductible
health plan (HDHP) based on the individual's representations of eligibility.
An "eligible individual" means, with respect to
any month, any individual who:
- Is covered under a qualifying high-deductible health plan
on the first day of any month.
- Is also not covered under another health plan that is not
an HDHP (with certain exceptions for plans providing certain
limited types of coverage).
- Is not entitled to benefits under Medicare (generally has
not yet reached age 65).
- May not be claimed as a dependent on another person's tax
It is the individual's responsibility to advise BCBSKS immediately
should he or she become ineligible for an HSA or enrolls in
How the HSA Works
- The employer elects a qualifying high-deductible health
plan and can contribute money to an HSA. Employees may also
to the HSA.
- The employee uses money in the account to pay for qualified
medical expenses not covered by the high-deductible health
- Employee has access to online tools and resources to manage
their health, track services received under their health
insurance program and verify funds available in their HSA.
- Unused money in the account can be rolled over from one
year to the next, earning compound interest.
- The rollover feature allows employees to save for future
Blue by Design HSA:
- Employer contributions are excluded from taxable income
and employment taxes do not apply.
- Employee contributions are tax deductible.
- Tax-free withdrawals can be made for qualified medical
- Contributions remain in HSA from year to year until they
are used. No “use it or lose it” provision.
- Account is owned by the employee — it can go with
him or her, even if employee terminates.
BCBSKS Qualified High-Deductible Health Plan
The Blue by Design HSA can be used in conjunction with our
Comprehensive Major Medical high-deductible product. With this
affordable coverage, you have a deductible of $2,500 for each
covered person ($5,000 two-or-more person coverage). After
the deductible is met, we pay 100% of allowed charges for covered
services for the remainder of the 12-month benefit period.
Learn about the benefits of
Comprehensive Major Medical