This article only applies if you've been told that your Blendable HSA is switching from HSA Classic to HSA Select. Consult your Advisor if you have questions about what type of Blendable HSA you have.
Legislative changes are forcing us to change your Blendable Health Spending Account (HSA). We're ending contributions to your HSA Classic and starting a brand new HSA Select.
This article describes:
- Why this is happening;
- What it means for you as the Plan Sponsor and you as the Plan Member; and
- How the new HSA Select will work.
Plan Sponsor vs Plan Member
Before we begin, an important clarification. As an incorporated business owner, who is also the only person receiving contributions to their Health Spending Account you have two roles that you need to differentiate between:
This is you the business owner. You're making decisions on behalf of the company and are providing a benefits plan.
This is you as the employee. You are actively at work in your business and the company is providing a benefits plan for you. You receive contributions to your HSA and make claims.
Our Blendable HSA Classic is a type of Health Spending Account (HSA) where the funds you contributed by Plan Sponsors are held in trust for Plan Members in a Health and Welfare Trust (HWT). These funds are available to reimburse eligible medical expenses until Plan Members use them up.
The Federal Government recently made changes to the types of trusts they will allow for group benefits. This means that we need to start using a new kind of trust - an Employee Life and Health Trust (ELHT) - for our HSA Classic.
What is an ELHT?
An ELHT is a type of trust that can be used for group benefits, similar to an HWT. The big difference is that the ELHT has very specific rules about what kind of members can participate and how much those members can receive for their group benefits.
Like most government rules and regulations it's all a bit complex. It boils down to this: because of the limitations of the ELHT, we can't use it to provide an HSA where the only Plan Member is also the Plan Sponsor without risking negative tax implications for everyone involved (and no one wants to get in trouble at tax time!)
Impacts to your HSA as a Plan Member
In order to keep giving you the amazing flexible benefits you're used to, we're setting up a new type of HSA for you - our HSA Select.
Same great HSA advantages
Your Member Centre, including login info, how to submit a claim, and all the personal information you've inputted stays the same.
Your HSAs and balances
For now, you'll have two HSAs with their own balances, contributions, and benefit periods. Visit your Member Centre (use your custom URL, or head to https://login.blendable.ca if you can't remember it) and click on Health Spending Account to view the details of each HSA.
Any funds remaining in your HSA Classic will stay there. They are yours to use for eligible claims.
You'll receive contributions to your HSA Select which will be available for one year only (your Benefit Period). At the end of the Benefit Period unused funds are reset and credited to the Plan Sponsor.
How we'll pay your claims
Any new claims will be paid using your HSA Select balance first. If you don't have enough funds in your HSA Select to pay the full amount of the claim we will use HSA Classic funds to pay the difference.
Once your HSA Classic funds have all been used only your HSA Select balance will be available to pay claims.
As always, you can only use funds available in a current benefit period to reimburse expenses from that period. Learn more about how HSA dates affect claim reimbursements.
Bonus - Excess Medical Coverage
Included with your HSA Select is Excess Medical coverage for you and your family. Excess Medical is designed to provide support for unanticipated expenses. It goes above and beyond what your HSA would be expected to cover for things such as a catastrophic accident, a chronic medical condition, or a critical illness.
Impacts to your HSA as the Plan Sponsor
Contributions to the HSA are still tax-deductible for your business.
Your Plan Centre, including login info and all the business information you've inputted stays the same.
How funds are managed
When you set up your HSA Select you chose either annual contributions or monthly contributions. We'll take payment based on that selection and deposit funds in the HSA.
At the end of the year (the Benefit Period) any funds remaining in the HSA will be reset. The HSA balance will be $0 and the unused funds will be used as a credit on future bills.
Still have questions?
If you've got questions, we've got answers! Say email@example.com and we'll help you out.