The new rules of health care savings

HSA debit card

Making every health care dollar count is important in the best of times. In a pandemic, you want to pay even closer attention to your health care spending.

Faced with uncertainty, our customers are raising questions about how they can use dollars set aside for medical, dental and vision expenses. Employers and employees are asking about health savings accounts (HSAs), flexible spending accounts (FSAs), health reimbursement arrangements (HRAs) and other benefits that allow for pre-tax dollars to be set aside to cover eligible costs.

The teams at Optum Bank are tracking policy shifts and other issues that might affect customers and their accounts. Below is a summary of the recent policy changes and commonly asked questions regarding medical accounts.

Can I use my medical HSA dollars to pay for COVID-19 testing?

All major health plans and many self-insured plans have waived member cost sharing for testing at approved locations, in accordance with CDC guidelines. That waiver includes copays, coinsurance and deductibles for COVID-19 testing.

For those plans that don’t waive costs, account holders can use their funds to pay for testing. Qualifying high-deductible health plans (HDHPs) paired with an HSA will also not lose their tax status because they cover testing or treatment costs before plan deductibles are met.

The CARES Act

Am I allowed to use my HSA to buy over-the-counter products?

One recent policy change affects over-the-counter (OTC) medications. According to the Consumer Healthcare Products Association (CHPA), the average American family spends $338 each year on these products.

The CARES Act — the Coronavirus Aid, Relief, and Economic Security Act — allows people to use their health savings accounts (HSAs), flexible spending accounts (FSAs), or health reimbursement arrangements (HRAs) funds to buy certain OTC drugs and medical supplies.

Eligible expenses include items that may be in your medicine cabinet, such as aspirin, antihistamines, bandages, heartburn relief, ibuprofen and more. Even your teenager’s acne cream, family’s sunscreen, and for the first time, menstrual and feminine care products, fall under the OTC umbrella.

To pay for these products, you can use your HSA debit card or pay for the items out of pocket and submit a reimbursement claim with receipts on the Optum Bank website. The changes apply to purchases made since January 1, 2020. And as of now, they are not set to expire.

What about telehealth services?

The CARES Act also includes a change regarding telehealth — the service that allows patients to connect with physicians and other providers by video and/or phone. These remote care services have grown in popularity during this time of social distancing since they keep patients who may not need in-person treatment from visiting clinics, protecting the patient(s) and the provider(s).

The policy change allows qualifying HDHP plans paired with an HSA to cover telehealth services, even if account holders haven’t hit their deductible. This temporary change will be in effect through the 2020 and 2021 health plan years.

Have there been any changes to dependent care flex spending?

It’s not just policy changes, but lifestyle changes that are impacting consumer spending. For example, parents may not be using child or adult dependent care services due to COVID-19. That is raising questions about how to use dependent care FSA dollars, especially as this is a “use it or lose it” plan.

If your dependent care needs are in flux, you may change, suspend or add elections to better fit your new situation. If your daycare provider has closed, you might suspend your contributions and re-elect once services start up again. This allows you to have more money in your paycheck.

Remember once options open again, you can use your dependent care dollars for day care, nursery school, preschool, after-school care, camps, adult/senior day care and more.

I’m not using my commuter benefits right now. Can I get a refund?

Some employers give employees the option to put aside transit money through payroll deductions for eligible expenses related to their daily drive, parking, or public transportation.

Since COVID-19 has forced many to work from home, people are asking if they can get refunds on transit passes purchased through their employer. It depends on how the employer’s account is set up. Consult with your benefit or human resource representative(s) for additional information on this benefit.

Here are a few steps you can take if you’ve set aside money for transit benefits:

  • Look online to see if you can edit or delete your order for the month.
  • Consider using funds for future commutes.
  • See if you can get a refund. Here’s a list of policies from transit vendors all over the country.
  • Check the expiration on your pre-paid cards, as some don’t have expiration dates.

I heard the deadline for 2019 HSA contributions changed. Is that true?

When this year’s federal income tax filing deadline was pushed back, an important HSA deadline was moved as well. Account holders now have until July 15, 2020, to make HSA contributions for their 2019 plan, up to the IRS 2019 limits.

No interruption to online banking services

The pandemic is not disrupting access to Optum Bank. Account holders can view their balance and transactions, submit receipts and pay bills or reimburse themselves.

Optum Bank is an online bank with no physical branches. We support all our account holders with 24/7 access through our website and our mobile app.

Visit optumbank.com to stay up to date on the latest developments related to the COVID-19 virus and medical spending accounts.

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This communication is subject to your specific plan documents and personal circumstances and is not intended as legal or tax advice. Health savings accounts (HSAs) are individual accounts offered or administered by Optum Bank®, Member FDIC, and are subject to eligibility requirements and restrictions on deposits and withdrawals to avoid IRS penalties. State taxes may apply. Fees may reduce earnings on account.
Flexible spending accounts (FSAs) and health reimbursement arrangements (HRAs) are administered by OptumHealth Financial Services and are subject to eligibility and restrictions. Federal and state laws and regulations are subject to change.
© 2020 Optum Bank, Inc. All rights reserved.

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