At Denmark State Bank, we believe it’s important to help you and your employees effectively manage rising health care costs. That’s why we’ve developed the Denmark State Bank Health Savings Account. It’s a tax-smart way for employees to save for qualified medical expenses that makes sense now and later.

• What is a "High Deductible Health Plan" (HDHP)?
• HSA / HDHP - Employer Benefits
• HSA /HDHP - Employee Benefits
• What is an HSA?
• HSA Checking Account Features
• HSAs Have Emerged As The Most Compelling Consumer Directed Health Plan Platforms
• Who is Eligible?
• HSA Contributions

What is a "High Deductible Health Plan" (HDHP)?

A High Deductible Health Plan, or HDHP, is a medical plan that has a minimum annual deductible of at least $1,100 for individual coverage or $2,200 for family coverage. The annual out-of-pocket expenses cannot exceed the caps established by the IRS. These out-of-pocket expenses include deductibles, co-payments and other health care related expenses. Generally, health insurance premiums are not qualified medical expenses, but there are a few exceptions. Your business insurance professional can explain these and whether your HDHP is approved for HSAs. 

HSA / HDHP Solution - Employer Benefits

• Work with insurance providers to create a plan that meets your employees’ needs
• Reduce health care expenses
• Employer contributions qualify as an employee benefit for tax purposes
• Employer contributions to employee HSAs are discretionary, but must be equitable for all participants based on employee class group
• Automate HSA contributions via ACH Direct Deposit
• No requirements for claim adjudication
• Helps motivate employees to participate in personal health care needs

HSA / HDHP Solution - Employee Benefits

• No vesting requirements
• Savings on premiums can be redirected to HSA
• Employer, employee or others can make contributions on the employee’s behalf
• Employees are not taxed for employer contributions
• Employee controls how and when HSA funds are distributed
• Accounts are portable and move with the employee
• May carry HSA balances from year to year or use dollars to pay COBRA premiums during unemployment
• Once enrolled in Medicare, any HSA funds remaining can be used tax-free to pay out-of-pocket medical expenses, or as supplemental income at retirement and taxed as ordinary income

What is an HSA?

A Health Savings Account (HSA) is an important tool for employees who participate in a High Deductible Health Plan (HDHP). Consumer-directed health care combines an affordable, qualified HDHP with a tax-favored health savings program, referred to as an HSA. The Denmark State Bank Health Savings Account, or HSA, is an interest-bearing checking account that can receive contributions on a tax-favored basis and allows tax-free distributions used to pay for qualified medical expenses.

Important note: All references to taxes relate to federal taxes; state tax implications may vary by state. Consult with your tax advisor for state tax treatment related to HSAs for the state in which you file taxes.

HSA Checking Account Features

• No set-up fee or monthly maintenance fee
  
• No minimum balance
  
• Interest bearing tiered account
  
• Funds can be withdrawn by check and/or debit card (subject to approval-no transaction fee)
  
• Monthly statement lists your transactions
  
• Closing fee $25.00
  
• IRS Amendment fee $25.00
  
• 24 Hour access to view your account at denmarkstate.com

Current Rates

HSAs Have Emerged As The Most Compelling Consumer Directed Health Plan Platforms*

Who is Eligible?

HSAs are exclusive, and can only be used in conjunction with a High Deductible Health Plan (HDHP). Employers can help employees who demand more control over personal health care needs by integrating an HDHP/HSA solution into a structured employee benefits program.

HSA Contributions

Employees can make contributions to their HSA each year they are eligible up to the standard limit:
 $2,900* — Self-only coverage
$5,800* — Family coverage
(Additional catch-up contribution amount $900; age 55 or older)

Tax Savings For Employees

An HSA provides triple tax savings:
1) tax deductions when employee contributes to their account;
2) tax-free earnings through investment; and
3) tax-free withdrawals for qualified medical expenses.

*2008 amounts; adjusted annually for inflation.
Source: U.S. Department of the Treasury

Important note: All references to taxes relate to federal taxes; state tax implications may vary. Consult your tax advisor for information specific to the state in which you file taxes.

Employer Contributions
As an employer, you are able to make contributions to your employees’ health savings accounts. This enables your employees to take a plan with less costly premiums while giving them the peace of mind that comes with high deductible health plan coverage. Employer contributions are not included as taxable income to the employee, and as a result, the tax advantages for the contributions are applicable to the employer. Employer contributions must be made on an equitable basis in accordance with the comparability rules that apply to employee benefit programs.

Deciding to offer an HDHP to your employees is just the first step.
Here are a few suggestions on how to get started.

Work with your Insurance Professional

• Determine which High Deductible Health Plan will best meet the needs of your employees and help offset expenses.

Work with your Tax Advisor:

• Your Tax Advisor can help you determine the financial impact and benefits associated with making contributions on behalf of your employees.

Review your current Employee Benefits Program:

• Do you currently offer a Flexible Spending Account (FSA) covering medical expenses that would need to be modified to be HSA compatible? Would a Health Reimbursement Arrangement (HRA) be beneficial to your employees?

Call your Denmark State Bank HSA Representative to integrate an HSA solution with your company's HDHP today!

• Use Denmark State Bank’s HSA educational resources to help you maximize employee participation.
• Bankers are available to meet with your employees on site.

Important note: All references to taxes relate to federal taxes; state tax implications may vary by state. Consult with your tax advisor for state tax treatment related to HSAs for the state in which you file taxes.

To find out more about Denmark State Bank Health Savings Accounts for businesses, contact a representative today at 1-920-863-2161.

For more information please reference the following:

• Internal Revenue Service
• United States Department of Treasury

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Products and services subject to bank/credit approval.
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