Group Administrators / Plan Choices and Features / Horizon MyWay HSA / How it Works

How it Works

Employers, employees or both can contribute to a Horizon MyWay HSA. Contributions to HSAs are 100-percent tax deductible. Although HSA contributions must stop when employees enroll in Medicare, employees can continue to access their HSA balances. Annually, the Horizon MyWay HSA can be funded up to the lower amount of the deductible or the maximum specified by law.

~ How do employees use their Horizon MyWay HSA Funds?

MyWay HSA funds can be used for any of the following:

• Save for future medical expenses.
• Pay for qualified medical expenses tax free.
• Pay for nonmedical expenses. (Note that for employees under age 65, withdrawals are subject to income tax plus a 10-percent penalty tax. Over age 65, withdrawals are subject to income tax only.)
• Help bridge the gap to benefits until they meet the annual health plan deductible.

HSA funds are portable, which means that employees can access their accounts regardless of a change of employer, age, marital-status, future medical coverage or state of residence. HSA funds roll over from year to year.

~ Horizon MyWay HSA Investment Option

Each HSA is held in a money market fund and accrues interest tax free. Once that money market account reaches a balance determined by the financial institution, there is the option to invest the dollars in a variety of mutual funds.

~ Accessing Horizon MyWay HSA Funds

There are various ways in which a patient can access his/her HSA dollars, as determined by the employer:

• A debit card
• Checks
• Automatic Teller Machines (ATMs)
• Manual distribution requests by Internet, mail or fax

Employees can access account information via the phone and the Web.

~ How Employees Enroll in a Horizon MyWay HSA

Included in the Horizon MyWay packet are Mellon HSA enrollment forms. Mellon Bank will manage the HSA. When these forms are completed, Mellon will be able to open an HSA on the employee's behalf. These forms include:

• Enrollment Form and Adoption Agreement
• Beneficiary Designation Form
• Mellon HSA Custodial Account Agreement

~ Welcome Information

After enrollment, employees will receive welcome information, which may include the following:

• Debit card
• HSA Welcome Brochure
• Terms and Conditions document

~ Eligible vs. Noneligible

Employees covered by qualified, high-deductible health plans are eligible to open a Horizon MyWay HSA.

If an employee is covered under another nonqualified, high-deductible health plan he/she is not eligible. For example: an employee covered by a spouse's plan that is not a qualified, high-deductible health plan is not eligible, even if the spouse's group has its own qualified, high-deductible health plan.

Specified disease coverage, hospital indemnity, vision, dental, accident and disability do not count as other coverage.

If an employee can be claimed as a dependent on another person's tax return, he/she is not eligible.

An employee enrolled in Medicare is not eligible to contribute to an HSA. He/she can, however, still use accumulated funds.