Leaving the University

If you opt to maintain your HDHP and HSA for up to 18 months through COBRA:

• Your HSA will be transitioned to an individual account with our HSA vendor, and you will be responsible for the monthly account maintenance fees.
• You will continue using your existing IU Benefit Cards.
• The university will no longer make contributions to your HSA via pre-tax payroll deductions, but as long as you are enrolled in a HDHP, you can make tax-free contributions to your HSA up to the IRS allowed maximum.
• Any contributions put in your account on an after-tax basis are eligible to be deducted from your gross taxable income on your tax return.

You do not have to contribute Indiana University’s $300 minimum to your HSA before you leave. This minimum contribution only applies to employees who enroll in the HSA and remain an active employee through the end of the year.

COBRA premiums are an IRS-qualified health care expense.

IU COBRA premiums must be paid with a check or money order.

You can use your HSA funds to pay your premiums in two ways:

• Log in at IU HSA and FSA Services and use the “Send Payment” feature online to send a distribution to COBRA (no fee applies to online provider payments)
• Send a check from your personal bank account then use the “File Claim/Reimburse Self” feature online at www.benefit-info.com/iu/, transferring funds from your HSA to your personal bank account to reimburse yourself for the cost of the premiums (no fee applies to online transfers)

Once a contribution has been made to your HSA, it is yours. You may, however, owe taxes on any contributions made to your account that exceed your prorated contribution maximum if you leave mid-year.

Details on the calculation of the IRS prorated maximum can be found in IRS publication 969.

If your contributions exceed the IRS prorated maximum, you must work with WEX to resolve the excess contribution issue.

Indiana University pays the basic monthly account maintenance fees as long as you are an active employee in the HSA. The basic account maintenance fee covers online account access and reporting plus two IU Benefit debit/VISA cards.

When you separate from the university or switch to a non-HDHP medical plan, you are responsible for all account fees (currently $2.75/month for the WEX HSA Cash Account). Additional fees do apply for things like insufficient funds, stop payment fee, etc.

See the complete Schedule of Fees [LINK].

Contact your new HSA provider and request an HSA transfer. This type of transfer is free and does not count toward the IRS contribution maximum.

Note: If you have excess HSA contributions, those funds should be removed from your WEX HSA before you transfer your HSA to another custodian.