October 2011

In this issue:

•     Coming soon: HSA banking made simple
•     Take charge of your health care spending
•     Open enrollment reminder
•     Choosing a beneficiary for your HSA

  Coming soon: HSA banking made simple

When you log into your health savings account (HSA) later this fall, you will begin to see a new banking experience—one designed specifically for owners of HSAs. It will be easier and quicker to:

• Pay bills and set up recurring payments, such as monthly orthodontist payments
• Keep a list of doctors, hospitals and other health care providers you pay electronically from your HSA
• Deposit money into your HSA by transferring money from other personal accounts
• Reimburse yourself for qualified medical expenses paid out-of-pocket

Your feedback and suggestions helped us design the new experience. We also asked a sample group of account owners to test it to make sure it was simple, intuitive and a pleasure to use. The positive feedback we received helped us create the updated website you will soon see.

Changes to the log-in process
We’re also making improvements to the log-in process. The first time you log in to the new banking experience, you will be asked for some basic personal information — name, date of birth and your Social Security number. You will also be asked to set up several security questions and provide an email address.

There will be no interruption to pending transactions, such as payments or deposits. You may, however, have to re-enter some of your doctors’ and other health care providers’ names and addresses if you used online bill payment in the past.

More enhancements planned
Throughout the rest of 2011 and into 2012, additional functionality is scheduled to launch, including:

• Improved display and explanation of investment options to make it easier for you to track investments and transfer funds from HSA deposit accounts into investment accounts
• Ability to request e-delivery of tax forms, annual privacy policy mailing and other communications from OptumHealth Bank (note: statements are already delivered online unless you have requested they be mailed)
• Access to Morningstar reports

We are confident that these banking experience improvements will make it easier for you to plan, save and pay for health care.

  Take charge of your health care spending

This month’s focus: maximizing your HSA contributions. Fall is a great time to log in to your HSA to check your balance and 2011 contributions. Make sure you're contributing enough to cover your known expenses, such as recurring and planned medical appointments, and, if possible, saving for future health care expenses. Here are some details about HSAs that may affect your decision:

• Contribution limits: HSA contribution limits for 2011 are $3,050 for individuals and $6,150 for family coverage. You can make an additional $1,000 catch-up contribution if you are 55 or older and not enrolled in Medicare. In 2012, the contribution limits increase to $3,100 for individuals and $6,250 for families.
• No use-it-or-lose-it rule: Dollars in your account at the end of the year carry over and can be used to pay for future qualified medical expenses, even if you change jobs, retire, or quit working to return to school or care for family.

There are several ways to increase your contributions, as long as you stay within the maximum contribution amount.

• Increase your payroll deduction: If payroll deduction is available at your company, ask your benefits department how to increase your HSA contribution. (Contributions made by payroll deduction are pre-tax, so you save on FICA, too — 5.65% more tax savings than if you make a direct deposit.)
• Make an electronic transfer: You can add funds to your HSA with an electronic transfer from your bank account. Simply sign into your HSA, click on “eContribute” and follow the instructions.
• Mail a check: To contribute by mail, complete an HSA contribution deposit form and mail it with a check to the address on the form.

  Open enrollment reminder

During your company's open enrollment, remember to choose a qualified high-deductible health plan (HDHP)*, paired with an HSA from OptumHealth Bank^SM, Member FDIC. This will ensure you can maximize the benefits of your HSA:

• Ability to save for current and future health care costs: There's no "use it or lose it" rule with HSAs. Money in your HSA can be used to pay both current and future health care costs, even in retirement. But you can only contribute if you are in an HSA-eligible health plan.
• Tax savings: You pay no federal income taxes, and in most states, no state income taxes on deposits to your HSA.
• Growth potential: Your deposits may earn interest and grow over time.

*For 2012, qualified HDHPs must have a minimum deductible of $1,200 for individuals and $2,400 for families and maximum out-of-pocket costs of $6,050 for individuals and $12,100 for families.

  Choosing a beneficiary for your HSA

It’s important to designate a beneficiary for your HSA. It ensures that the funds in your HSA will be inherited by the person you choose when you pass away. You may designate your spouse, another person or a group of people (such as your children) as your beneficiary.

If you choose your spouse as beneficiary, your HSA will be transferred to him or her after your death and can be used to pay for your spouse’s qualified medical expenses. If you choose someone else as your HSA beneficiary, the account will be closed and the balance distributed to your beneficiary(ies) in cash. If you do not designate a beneficiary, the balance of your HSA will be distributed to your spouse. If you do not have a spouse, the balance of your HSA will be distributed to your estate and the fair market value of your HSA must be included on your final income tax return.

Designate a beneficiary for your HSA today. Download and complete the Designation of Beneficiary form.