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Health Savings Account (HSA)

A Health Savings Account (HSA) is a tax-advantaged medical savings account available to taxpayers in the United States who are enrolled in a high-deductible health plan. Combined, the HSA with the HSA PPO medical plan lets you choose not only where your money goes, but how you spend it, giving you more direct choice over your healthcare. You decide how much money to contribute through payroll deductions and your savings are deposited tax-free.

VMware HSA Funding

VMware believes in the value of the HSA PPO medical plan. For new hire employees who elect to enroll in the HSA PPO medical plan during 2020, VMware will contribute $187.50 for Individual coverage and $375 for Family coverage per calendar quarter to your HSA account. Existing VMware employees enrolled in the HSA PPO medical plan as of January 1, 2021 receive their employer funding of $750/$1,500 (Employee Only/Family) in January of 2021 and are not eligible for quarterly funding. If you and your spouse/domestic partner, both work for VMware and are separately enrolled in the HSA PPO medical plan you are only eligible for employer funding up to $750/$1,500 (Employee Only/Family). Employer funding is yours to keep and are portable if you leave VMware.

¹  All existing employees enrolled in the HSA PPO as of January 1, 2020 will receive employer funding of $750/$1,500 (Employee Only/Family). All new hires as of January 1, 2020 will receive employer funding on a quarterly basis (divided by 4). VMware funding based on coverage at the end of each quarter. Must be active on the last day of the quarter. Paid Interns are not eligible for VMware funding. HealthEquity accounts funded the pay period following the close of quarter.

In addition to VMware funding, there are many advantages to opening a Health Savings Account:

• Triple-tax advantaged – The money you contribute goes in tax-free^*, grows with interest tax-free, and comes out tax-free (as long as you use it to pay for eligible health care expenses). For 2020, you can contribute up to $3,600 for an individual and $7,200 for family, less any contributions made by VMware. If you and your spouse/domestic partner, both work for VMware and are separately enrolled in the HSA PPO medical plan, you can contribute up to $7,200 for your combined family, less any contributions made by VMware. In addition, account holders who are or turn age 55 or older by December 31st of the calendar year are eligible to make an annual catch-up contribution of up to $1,000 above the IRS limits. Those who intend to enroll in Medicare mid-year should pro-rate contributions each month.
• Watch it grow – Your unused funds roll over from year-to-year and grow with interest tax-free. Think of your HSA as your long-term health care savings plan to pay for expenses as they come up or in the future.
• You own it – VMware’s contribution and your own HSA contributions are yours. You can take your account with you when you retire or leave VMware for any reason.

^* Employer and employee contributions to the HSA are tax-free for federal and most state taxes. However, HSA contributions are not tax deductible for AL, CA, and NJ.

Eligibility 

You must elect the HSA PPO plan for your medical coverage during annual or new hire enrollment to be eligible for the HSA. In addition, you must NOT be:

• Covered under any other traditional health plan.
• Enrolled in Medicare or Medicaid.
• Covered as a dependent on another individual’s tax return.
• Enrolled in a Health Reimbursement Account (HRA) or General Purpose Flexible Spending Account (GPFSA).
• Currently receiving any health benefits from the Veterans Administration (or have received any in the last three months).

If you are not eligible for an HSA based on the above, you have the option to enroll in the HSA PPO non-eligible HSA plan. You are still able to receive the VMware funding, however it will appear as a taxable bonus on your paycheck instead of being deposited into a HealthEquity [VMware network access required] account.

Making Contributions

During enrollment, you elect how much you want to contribute. You can change, stop or start contributions at any time via Workday [VMware network access required] site. Refer to the Workday Quick Reference Guide: Change HSA Contribution [VMware network access required]. You can also make an after-tax contribution after the calendar year and prior to April 15^th of the following tax year deadline. This allows you to contribute up to the maximum IRS limit.

Managing Your Account

Our HSA administrator, HealthEquity makes it easy to manage your account. You will receive a debit card for eligible expenses and you can also submit receipts for reimbursement. Visit the HealthEquity [VMware network access required] secure website, where you can view balances, check on payments, review contributions, and much more. If you currently have an HSA account from a previous employer, you have the ability to roll those funds over into your VMware HSA account. Visit HealthEquity [VMware network access required] for more information and complete an HSA Transfer Form.

Once you have a balance of $1,000, you can invest your savings. HealthEquity offers several mutual fund options you can choose from.

For more information on the Health Savings Account review the HSA Guidebook.