Health Savings Account (HSA)

An HSA is a tax-advantaged account for participants in a high deductible health plan (HDHP) that can be used to pay for qualified medical expenses, including copays, prescriptions, dental care, contacts and eyeglasses, bandages, X-rays, and a lot more. It’s "tax-advantaged" because your contributions reduce your taxable income, and the money isn't taxed while it’s in the account—even if it earns interest or investment returns.

Bonus: As long as you use your HSA funds for qualified medical expenses, you won't owe taxes when you take money out of the account.

An HSA works together with a high deductible health plan (HDHP), such as the UM/Aetna Health Savings Medical Plan. If you're enrolled in this medical plan, you can make pretax contributions to an HSA and, consequently, pay for qualified medical expenses tax-free. Making HSA contributions can help create a cash cushion to offset the higher deductibles that HSA-eligible health plans typically have.

If you don't need the money in your HSA for current medical expenses, you can save and invest it until you do. This sets HSAs apart from another popular account, the health care flexible spending account (FSA). Unlike an FSA, an HSA offers flexibility is not "use-it-or-lose-it," the money is yours to keep, funds carry over year over year, can be invested, and you can take it with you when you leave an employer.

The IRS defines a qualified medical expense (QME) as the cost to diagnosis, treat, or prevent disease and includes equipment and supplies needed for those purposes.

You can use your HSA to pay for doctor's visits, hospital services, surgery, and medications, to name a few. For a full list, see IRS Publication 502.

To be considered an HSA-qualified HDHP, a health plan must meet several tests:

1. It must have a deductible above a certain minimum threshold,
2. It must limit total annual out-of-pocket expenditures for covered benefits to no more than a certain maximum threshold, and
3. It can cover only preventive care services and certain insulin products before the deductible is met.

In 2026, HSA-qualified HDHPs must have a minimum deductible of $1,700 for self-only coverage and $3,400 for family coverage and an annual limit on out-of-pocket* expenditures for covered benefits that does not exceed $8,500 and $17,000, respectively. These amounts are adjusted for inflation (rounded to the nearest $50) annually. What’s an HSA-Eligible Health Plan?

At the University of Miami, the UM/Aetna Health Savings Medical Plan is an HSA-qualified HDHP.

* The maximum out-of-pocket limit includes deductibles, copayments, and coinsurance, but not premiums. 

No. Unlike a Flexible Spending Account (FSA), HSAs are not subject to "use-it-or-lose-it" rules. This means you don't forfeit any money you don't use in a given year, and you can carry it forward until you reach a time that you want or need to use the money in your HSA. Combined with the ability to invest funds, this allows your health savings to benefit from compounding returns.

No. Your HSA is your account, not your employer's. Unlike health care FSAs, which your employer technically owns, your HSA belongs to you. So when you leave a job, you keep all of the money you've saved up in your HSA and can transfer into a new HSA or employer-sponsored HSA at your next job. You can even open an HSA if you're in an HSA-eligible health plan and your employer does not provide one—or if they do but you prefer a third-party option. (But keep in mind you can only avoid FICA taxes if you contribute to your employer's HSA through payroll deductions). It's also possible to have multiple HSAs. Some people have one for investing and another for cash to pay medical expenses.

Your HSA is always yours, so you can still spend your HSA money on qualified medical expenses with no federal income taxes or penalties in retirement.

Retirement-related qualified medical expenses, covered by your HSA, could include:

• COBRA coverage costs
• Health care coverage while you’re receiving unemployment benefits
• Medicare premiums other than Medicare Supplemental coverage
• Qualified long-term care coverage

If you choose to use your HSA money for something other than qualified medical expenses, you will be responsible for paying federal income taxes on it and may be penalized if you’re under age 65. You’ll also still be eligible to contribute to an HSA after retirement only if you are still covered by an HSA-qualified health plan and are not enrolled in Medicare or have any other disqualifying coverage. Once you enroll in Medicare, you must stop making HSA contributions, but you can continue to use your remaining HSA funds for qualified medical expenses.

Your Fidelity HSA is an individual, personal owned account that may be passed on to your heir(s). If you did not designate your beneficiary during the HSA online application process, be sure to designate your beneficiary at fidelity.com/fidelityHSA.

Per IRS regulations, to be eligible to contribute to or receive employer contributions in the HSA, you must be enrolled in a high deductible medical plan (Aetna Health Savings Medical Plan) and faculty and staff:

• Cannot be enrolled in secondary medical coverage (Medicare Parts A/B, TRICARE, VA, Medicaid, or a spouse’s employer plan)
• Cannot be enrolled in a Healthcare Flexible Spending Account (HCFSA)
  • Faculty and staff may still enroll in the Health Savings Medical Plan and elect not to participate in the HSA if they want to participate in a HCFSA
• Must have a valid US address (no P.O. Box)
• Cannot be claimed as a dependent

If you enroll in the UM/Aetna Health Savings Medical Plan and elect to participate in the Health Savings Account (HSA), the University will contribute an annual one-time lump sum of $500 for individual, $1,000 for family, to your account. Note, you are not required to make voluntary contributions to receive employer contributions, however you must elect the HSA.

Employer contributions are deposited in the first payroll period following full month of enrollment. 

Employee voluntary contributions are deposited each pay period. Funds must be available in the account before use, unlike a HCFSA. If enrolling mid-year, the total employee contribution is  divided into the remaining months of the calendar year. 

Yes. As the HSA is an individually-owned account, employees can make changes to their voluntary contribution amount throughout the year without experiencing a qualifying life event (QLE).

Note, if you transitioned from the Aetna HRA to the Aetna Health Savings Medical Plan and used any leftover HRA allowance in 2026 for eligible medical, pharmacy, and vision expenses, you are unable to enroll in the HSA until 2027. An employee cannot use HRA funds and HSA funds in the same calendar year.

To make changes to your HSA contribution amount, please follow the steps below:

1. Log in to Workday.
2. Click Menu on the upper left hand corner of the Workday homepage.
3. Under Personal, click Benefits and Pay Hub.
4. Under Tasks and Reports, click Change Benefits.
5. Under the Change Reason drop down box, select HSA Contribution Change.
6. Enter the Benefit Event Date. Note, the effective date of the change is the first day of the next month. For example, if the request is submitted with a benefits event date of 1/16/2026, the contributions will begin as of 2/1/2026.
7. Click Submit.
8. Click Open on the pop-up window to begin.
9. Click Let's Get Started.
10. Click Manage.
11. Click Confirm and Continue.
12. Enter the annual contribution amount, then click Save.
13. Click Review and Sign.
14. Check the box next to I Accept.
15. Click Submit.

There are multiple ways to use your HSA for payment or reimbursement of qualified medical expenses, including, but not limited to:

• Pay with your HSA debit card. Your Fidelity HSA debit card can be used to pay for qualified medical expenses at the point of sale, when your out-of-pocket cost is known (such as prescriptions). Additionally, most health care providers will allow you to use your HSA debit card to pay for bills you receive in the mail. An HSA debit card can be requested for a spouse or eligible dependents.
• Pay a health care provider directly using the Fidelity Health app or NetBenefits. Simply select your payment amount and confirm your provider's information, and Fidelity will send payment from your HSA.
• Pay out of pocket and reimburse yourself. You can pay for a qualified medical expense and reimburse yourself from your HSA at any time in the future and without penalty. Simply transfer money online from your HSA into another Fidelity account or outside bank account.

Health Savings Medical Plan Preventive Drug List

Fidelity HSA Funds to Consider

Expanded Availability of Health Savings Accounts under the One, Big, Beautiful Bill Act (OBBBA)

Fidelity Health Savings Account Calculator

• What is an HSA and how does it work?
• 3 ways to use your health savings account
• 6 benefits of an HSA in your 20s and 30s
• 8 myths about HSAs
• HSA triple tax advantages explained

• What is an HSA and how does it work?
• Learn what an HSA is—and all the reasons to have one
• Making the most of a health savings account

1-800‑544‑3716
www.umretirement.com

305-284-3004
www.miami.edu/benefits/ask