Health Savings Account (HSA)

Health Savings Account (HSA)

If you enroll in the HSA Plus Plan or the HSA Basic Plan, you may be eligible to establish a Health Savings Account.

• An HSA allows you to put aside money in a pre-tax account and use it to pay for eligible medical, dental and vision expenses.
• The 2023 HSA contribution limits are $3,850 for individual coverage and $7,750 for family coverage.
• If you are 55 or will turn 55 in 2023, you can make an additional $1,000 in catch-up contributions.

Money in the HSA is yours and will never be forfeited. Because you aren’t actively working and receiving a paycheck directly from AEP, you can’t elect to contribute to an HSA through AEP; however, you can open an HSA and make your own contributions directly to the account, up to the IRS limits, and deduct those contributions on your federal income tax. For information about your accounts contact Health Equity at 1-866-346-5800 or healthequity.com/aep.

NOTE: Domestic partner’s claims cannot be covered under your HSA without incurring a tax consequence, unless your domestic partner qualifies as a dependent for tax purposes. According to the IRS, “qualified medical expenses” with respect to an HSA do not include medical expenses of a non-dependent domestic partner. Therefore, any amount paid from your HSA to cover medical expenses of a non-dependent domestic partner would be included in your gross income and would be subject to an additional 10% excise tax.

You cannot select the HSA Plus Plan (if eligible for AEP HSA funding) or make your own tax-deductible contributions to an HSA under either the HSA Plus Plan or the HSA Basic Plan if you anticipate meeting any of the following criteria as of January 1, 2023:

• You are covered by any Health Plan that is not an HSA-compatible Health Plan. This includes a spouse/domestic partner’s Plan as secondary coverage or an executive Medical Plan.
• You are covered by or planning to enroll in an unlimited Health Care Flexible Spending Account (HCFSA) established by you, your spouse/domestic partner or any other family member.
• You are a veteran who has or plans to receive veterans’ medical benefits within the three months prior to January 1, 2023.
• You have received medical services from the Indian Health Service within the three months prior to January 1, 2023.
• You can be claimed as a dependent by someone else for the 2023 tax year.
• You are enrolled in Medicare or Medicaid.
• You are active in the military.