PBS Health Savings Account (HSA)
What is a Health Savings Account?
An HSA is an individual health account that is owned by the employee and may be used for the payment of medical expenses that are not covered by a high deductible health plan.
HSA contributions are made on a pre-tax basis and therefore will not count as taxable income. You will save in taxes because your taxable income is reduced by the amount you contribute and thus lowers the amount of taxes you pay.
HSAs are similar to individual retirement arrangements (IRAs) in that the participant owns them, directs the investments, and amounts not used continue to accumulate in the account. Employees can make pre-tax contributions to an HSA via payroll deduction or by direct deposit into the account via check or electronic funds transfer. When combined with a qualified High Deductible Health Plan, the HDHP covers serious illness or injury, while the HSA pays for medical expenses until the deductible is met.
How can I use the funds?
HSA dollars can be used during the plan year to pay for qualified out-of-pocket expenses and services. The PBS Prepaid Benefits Card is a special-purpose MasterCard™ card that lets you swipe to access the pre-tax amounts set aside in your HSA. Your card balance information can be accessed 24/7 through your PBS online consumer portal or our mobile app named “PBS Benny” in the app store.
The PBS Benefits Card is valid for five years. Please check the expiration date on your card. New cards will not be sent unless you lose the card or request for additional cards to be sent to your home.
Once enrolled, employees must log on to their online PBS consumer portal to read and accept the HSA terms and conditions (one time only) to gain access to the account funds.
What are qualified HSA expenses?
You can use your PBS Prepaid Benefits Card to pay for eligible out-of-pocket medicalexpenses. The IRS defines eligible health care expenses as health care costs you or your dependents incur for the diagnosis, cure, treatment or prevention of diseases, conditions, or ailments. HSAs cannot reimburse expenses that are reimbursable from any other source.
Healthcare Expenses include:
- Prescriptions (such as birth control pills)
- Health plan copayments, deductibles, and coinsurance
- “Amount Due” on medical and dental statements
- Orthodontics and other dental services
- Vision services, contacts/eyeglasses, and LASIK surgery
- Medical supplies such as bandages, thermometers, and blood pressure monitors
- Certain over the counter (OTC) items such as cold/flu medication, allergy medication, and pain relievers
For a full list of eligible expenses, please visit our Compete FSA Eligibility List. Coverage mimics that of a FSA..
How much can you elect to contribute to a HSA?
HDHP limits, for 2023 these limits are as follows:
- Annual limitation on deductions to an HSA – Self-only coverage $3,850
- Annual limitation on deductions to an HSA – Family coverage $7,750
HDHP limits, for 2024 these limits are as follows:
- Annual limitation on deductions to an HSA – Self-only coverage $4,150
- Annual limitation on deductions to an HSA – Family coverage $8,300
The remaining balance rolls over from year to year; accounts move with employees even if change of employment or retirement. Please inquire with your HR department and/or PBS regarding HSA account transfers.
At age 65, unused funds can be withdrawn for non-medical reasons without penalty; ordinary income tax will be charged on the money withdrawn for non-medical reasons.