The good news about supplemental benefits is that many of them can be offered together and in fact, often complement each other.
Commuter benefits and Lifestyle Spending Accounts can work with any health plan or benefits configuration.
By offering more than one supplemental benefit account you can ensure the diverse needs of your workforce are covered, you can empower your employees to take control of their physical and mental health and you can help to ease the financial stress that 58% of workers reported they feel on a daily basis.
In order to build the best benefits package possible, it’s important to first understand how some of these supplemental benefits work together. There are three that have the most stringent restrictions in regards to eligibility and how and when they can be contributed to.
These are:
- HSAs
- FSAs
- Standard or Integrated HRAs
Below we discuss how these work together.
HSAs and FSAs
As an employer, you can offer your employees the option to choose between an HSA (as long as you are also offering an HDHP as one of your group plan options) and an FSA. But employees can’t contribute to both at the same time. If employees have an existing HSA, they can sign up for an FSA for the current plan year if they pause their HSA contributions. They can still use their previously made HSA contributions but since these never expire, and their FSA do, employees should be encouraged to use their FSA money first.
HSAs and Standard or Integrated HRAs
Employers can offer employees the option to choose between an HSA or a Standard or Integrated HRA, but employees can’t participate in both. Employees that have a preexisting HSA will have to pause contributions to their account if they elect Standard or Integrated HRA coverage. They will still have access to the contributions they’ve previously made, but like with the FSA, they should be encouraged to reimburse for qualified medical expenses through the HRA first since the money in this account will expire at the end of the plan year.
FSAs and Standard or Integrated HRAs
Employers can offer their employees both an FSA and HRA and they can be used at the same time. Typically, employees should be encouraged to use their FSA funds first so that they don’t expire and then tap into their HRA reimbursements once their FSA has been exhausted.
LSAs, Commuter, and MTAs: Supplemental benefits that go with everything
LSAs, commuter benefits, and MTAs are powerful tools employers can use to augment their group health plans and other supplemental accounts. They can be offered alongside an HSA, FSA and a Standard or Integrated HRA and used to cover expenses the other plans don’t. These include work-from-home and wellness expenses, commuting expenses to and from work, medical travel that supports reproductive and specialized care, and more. They help companies to build a complete coverage umbrella that supports the diverse needs of their workforce and leaves employees feeling valued and supported.
To build the most complete benefits package, employers can choose from one of the tax-advantaged medical supplemental accounts (HSA, FSA, or HRA), offering the account type they feel will most benefit their workers as well as serving their benefits strategy. They should also decide whether they want to offer a pre- or post-tax commuter benefits account.
Then, employers should decide which additional expenses they want to cover and design one or multiple LSAs and an MTA around those values. Providing employees with financial support in navigating life’s challenges will lead to a workforce that isn’t just physically and mentally healthy, but is also more loyal.
Lively can help you get started today.