Financial Well-being

Healthcare pretax savings accounts

You can save money by setting aside pretax dollars in a healthcare savings account to help cover your share of healthcare costs, including medical, prescription, dental and vision expenses.

Depending on how much you contribute and your tax bracket, your overall taxable income will be lower, saving you money.

Often referred to as pretax savings accounts, the health system offers two options, depending on which medical plan you choose — a health savings account (HSA) or a healthcare flexible spending account (FSA).

The health system offers the HSA and FSA through Fidelity, the same partner who administers our retirement plans.

HSA Healthcare savings account	FSA Healthcare flexible spending account
For employees enrolled in the HSA Advantage plan	For employees NOT enrolled in the HSA Advantage plan
The health system gives $500 for employee-only coverage and $1,000 for any type of family coverage. On top of this, you can set aside your own pretax dollars, up to $4,500 for individual coverage or $9,000 for family coverage. If you are 55 or older, you can add up to $1,000 more.	You decide how much of your own money to set aside for this account, up to $3,400 per year. These pretax dollars can also be used for over-the-counter items such as allergy and sinus medications, and first-aid supplies.
You can use this money as it’s deposited into your account. The amount the health system contributes becomes available in early January.	You can spend the full annual amount you’ve planned to set aside at the start of the plan year, even if it hasn’t been fully funded through your payroll deductions yet.
Money rolls over from year to year. You can use it to pay for qualified healthcare expenses or save it. Funds can be invested through Fidelity to grow your money for the future.	Money does not roll over from year to year. Take care not to put more money into this account than you know you will be spending on healthcare expenses during the year.

Health savings account (HSA)

WHAT is an HSA?

It is an easy and smart way to save money. An HSA pairs with an HSA-eligible medical plan to save on healthcare costs now and invest for future expenses.

WHO can contribute to an HSA?

Employees who enroll in the HSA Advantage medical plan. Additional IRS requirements are:

You cannot be covered by other health plans that are not HSA-eligible.
You cannot currently be enrolled in Medicare
You cannot be claimed as a dependent on another person’s tax return.

More details about eligibility are in this overview about HSAs.

WHY use an HSA?

An HSA allows you to save money on a pretax basis to pay for qualified medical expenses for you and your dependents. Think of an HSA as a guaranteed discount on money you’re already going to spend on eligible healthcare expenses (braces, prescription drugs, copays for medical care and much more).

An HSA also can be an effective way to save and invest for future healthcare expenses, such as in retirement.

IMPORTANT things to know

The health system contributes “seed” money to HSA accounts of employees who enroll in the HSA Advantage medical plan and the HSA. The money is contributed at the first of each year (or when newly eligible employees activate their accounts) to support your healthcare expenses. The health system contributes $500 for individual only coverage; and $1,000 for any type of family coverage.
You can contribute additional pretax dollars from each paycheck, up to $4,500 per year for individual coverage; $9,000 for family coverage. Employees 55 and older may contribute an additional $1,000.
- You will choose how much you want to contribute during annual benefits enrollment.
- You have the flexibility to change your contributions at any time, as long as you stay within the IRS limits listed above. To change your contribution, go to the benefits enrollment website, bswift, and choose Change my HSA Election life event. Or, contact the benefits team for help: BenefitsConnection@kumc.edu or 888-494-9119.
Funds roll over from year to year.
You can invest money in your HSA through Fidelity.
It’s yours. The money goes with you if you leave the health system.

HOW does it work?

There are multiple ways to use your HSA for payment or reimbursement of qualified medical expenses, including:

Using a Fidelity HSA debit card for eligible purchases.
Managing your plan through Fidelity’s NetBenefits, available online and via mobile app.
A full list of options is part of the HSA reference guide.

Healthcare flexible spending account

WHAT is a healthcare FSA?

A healthcare flexible spending account (FSA) is a tax-advantaged account that allows you to pay for qualified medical expenses using pretax dollars.

WHO can contribute to a healthcare FSA?

Employees who are not enrolled in the HSA Advantage medical plan but have ongoing or expected medical, prescription, dental and vision costs in the coming year may enroll in a healthcare flexible spending account (FSA). These pretax dollars can also be used for over-the-counter items such as allergy and sinus medications, and first-aid supplies.

WHY use a healthcare FSA?

Depending on the extent of your healthcare costs, an FSA can help you save a lot of money on taxes.

Read this overview about healthcare FSAs to deepen your understanding.

IMPORTANT things to know

FSA balances expire. It’s therefore important not to contribute more than you spend, as unused funds do not roll over from year to year. However, there is a grace period until Feb. 29, 2028, to incur expenses; claims for reimbursement for 2027 expenses must be submitted by April 30, 2028.
The amount you decide to contribute, up to $3,400 per year, is deducted from your salary before taxes, reducing your taxable income.
You can use your FSA for expenses for you or your spouse, and any dependents you claim on your taxes. You also can use healthcare FSA funds for any adult children on your medical plan who will be 26 or younger on Dec. 31.

HOW does it work?

You can use an FSA debit card to pay upfront, or submit receipts and get reimbursed through Fidelity’s NetBenefits, available online and via a mobile app.

At a glance: HSA and healthcare FSA

	Health savings account (HSA)	Healthcare flexible spending account (FSA)
Who can open the account?	Benefits-eligible employees who elect the HSA Advantage medical plan.	Benefits-eligible employees who are not enrolled in the HSA Advantage medical plan.
Why should I open an account?	To save for future healthcare expenses in 2027 and beyond. Money goes in tax-free, is invested tax-free and can be used to pay for qualified medical, dental and vision expenses. The health system will deposit $500 for individual-only coverage; $1,000 for family coverage.	To save for qualified healthcare expenses expected in 2027. The money you set aside in the FSA is not subject to taxes, so you take home more of your paycheck.
How can I use the money?	To pay for medical, dental and vision expenses including deductibles, coinsurance, prescriptions and other eligible expenses.	To pay for medical, dental and vision expenses including deductibles, coinsurance, prescriptions and other eligible expenses.
What if I don't use the money in 2026?	All unused funds roll over each year.	Any unused funds are forfeited. You have until April 30, 2028, to submit claims for eligible expenses incurred Jan. 1, 2027-Feb. 29, 2028.
When can I use the money in my account?	Money you contribute from each paycheck is available as soon as it's added to your account. Funds provided by the health system are available in January or, for newly eligible employees, as soon as your account is activated.	Your total annual elected amount is available for you to use beginning Jan. 1, 2027.
Can I invest the money in my account?	Yes	No
How much can I contribute?	Up to $4,500 individual, $9,000 family. Age 55 and over may contribute an extra $1,000.	Up to $3,400.