What is the HSA advance feature and what are its benefits?
Further’s health savings account (HSA) advance feature provides account holders early access to HSA funds before routine employer contributions have been deposited into their account. It's a supplemental feature that can be added to any HSA product offered by Further.
For employers, this feature can help with increasing employee adoption of HSAs, provide employees a safety net against early medical expenses, reduce the likelihood of employees delaying necessary care due to cost, and improve the overall benefits offered to employees.
For employees, it offers access to HSA funds before they've had the chance to build their balances through routine employer contributions. This provides a safety net in the event medical care is needed early in the year, decreasing the likelihood of delaying care due to costs. The feature also helps employees who are new to HSAs familiarize themselves with high-deductible health plans and the basics of how contributions work.
How does the HSA advance feature work for employers?
Employers start by completing a plan design guide and an HSA advance feature group election form. Employers can offer employees up to, but not exceeding, the amount of their planned annual employer contribution. Once that is complete:
- Employers then need to submit an adjusted enrollment file that dictates the advance amount for each employee based on each individual employee’s coverage type and eligibility.
- Employees who wish to opt-in will enable HSA advance feature via the member portal; their first qualifying expense will trigger advance funds
- The new HSA advance feature report will be available on the Group Portal displaying all employees who have enabled the HSA advance feature
- Weekly claims reimbursement will be invoiced for the total advanced amount for the employee population and an ACH pull will pay for the invoiced HSA advances
- Routine group contributions repay the employee’s advanced amount until funded balance is zero
Employers will be automatically renewed for the HSA advance feature at the new plan year. Employees must re-enroll for HSA advance feature for each new plan year.
The HSA advance feature has a monthly participant fee of $1.50/participant. There is no implementation or annual maintenance fee.
How does the HSA advance feature work for employees?
Eligible employees enable the advance feature under settings within Further’s member portal. Once it is enabled, employees can immediately start using it. Here's how that works:
- Log-in to the member portal
- Under “settings” select “Enable” for HSA advance feature
- The first eligible expense exceeding the funded available balance will trigger advance funds to cover the expense. This amount cannot exceed the available advance amount.
- The employer's routine contributions throughout the year are applied to repaying the outstanding advance balance until the outstanding advance balance is zero
After the current plan year ends, if the employee wants to re-enable the feature for the new plan year, the employee must re-enroll in the HSA advance feature in the member portal
If an employee terminates employment with their employer before repaying HSA advance funds in full, the employer is responsible for recovering any unpaid balances.
What are employer eligibility requirements for the HSA advance feature?
There are three requirements:
- Employer must have their plan year operate on a calendar year basis (plan year starting January 1)
- Employer must have ACH on file or set-up ACH with Further
- Employer must make employer contributions
Do I have to offer the HSA advance feature to all my employees?
Yes, if you elect to offer the HSA advance feature, it must be available to your entire employee population. However, it is worth noting, that by making it available to all eligible employees, it does not mean all employees will necessarily enable the feature as it is optional for each eligible employee.
Are HSA advanced funds a loan? How is it different from a loan?
No, HSA advance feature funds are not a loan. Loans are typically a financial agreement between an individual and a financial institution like a bank or credit union and typically carry an interest charge that must be paid back along with the principal amount of the loan. The HSA advance feature is an agreement between an employee and their employer and advanced funds carry no interest that must be repaid.