2025 Health Savings Account

A Health Savings Account (HSA) is a tax-advantaged savings account used in combination with a High Deductible Health Plan to pay for qualified health care expenses now, and later may be used to pay for health care expenses into retirement.

The HSA features a triple tax benefit!

• Your contributions into the HSA are made on a pre-tax basis
• Funds in the HSA can be invested, and the interest and earnings grow tax free
• The distributions you take to pay for eligible health care expenses are tax-free

Eligibility – In order to contribute to an HSA, you must meet the following conditions:

• You’re enrolled in a High Deductible Health Plan (HDHP) , Operation Smile’s OAP HDHP
• You aren’t covered as a dependent under a spouse’s non-HDHP plan
• Your spouse doesn’t have a general-purpose health care FSA
• You aren’t enrolled in any part of Medicare*, Medicaid, or TRICARE
• You haven’t received VA medical benefits within the past three months (unless for a service-connected disability)
• You aren’t claimed as a dependent on another person’s tax return

* If you delay enrolling into Medicare, you can continue to contribute to an HSA, but you should stop contributing to your HSA 6 months before signing up for Medicare

Contributions –

Employer matching contributions – On a quarterly frontload basis, Operation Smile will contribute up to $750 into your Lifetime Benefit Solution’s HSA Account for Single coverage or up to $1,000 for Family coverage,  prorated based upon your enrollment date. Family coverage is any coverage other than Employee Only.

Annual contribution limits – Maximum contribution limits are set by the IRS. For 2025, the maximum annual contribution limit is $4,300 for Single coverage, or $8,550 (per household) for Family coverage. Operation Smile’s contribution counts towards the IRS’s maximum annual contribution limits. An annual catch-up contribution of $1,000 can be made by individuals age 55 and older.  You can change your elected contribution amount on a monthly basis.

Note, state income taxes may apply to HSA contributions in some states.

Use your HSA – You’ll be issued a Health Spending Card by Lifetime Benefit Solutions to use to pay for qualified health care expenses, but you can also reimburse yourself at any time online or via Lifetime Benefit Solutions’ mobile app. There is no time limit to reimburse yourself, the funds just have to be contributed to the account first before you can use them. Any unused funds rollover year-to-year and all funds are always yours to keep, regardless of your employment status with Operation Smile.