Health Savings Account

The Basics

Optum Bank is the administrator of the City's Health Savings Account (HSA).  A Health Savings Account is a special, tax‑advantaged savings account that you can use to pay for qualified medical expenses. 

An HSA is only available to employees who are enrolled in the City's United Healthcare (UHC) Choice High‑Deductible Health Plan (HDHP).  HSA enrollment does not have to be elected every year.  As a City employee, your HSA account will roll over until you elect to leave the program either through election (by Open Enrollment or an approved Qualified Event) or if you are no longer covered by an HDHP.

For more information about Optum Bank's Health Savings Account, click here

IRS link regarding the HSA:  www.irs.gov/forms-pubs/about-publication-969

Who Can Open An HSA?

To be eligible and qualify for an HSA, you must be covered by the City's UHC Choice HDHP, which meets IRS guidelines for the annual deductible and out-of-pocket limit.
In addition, you must:

  • Be covered under the City's UHC Choice HDHP on the first day of a given month.
  • Not be covered by any other health coverage except what is permitted (dental, vision, disability, and some other types of additional coverage are permissible).
  • Not be enrolled in Medicare, TRICARE, or TRICARE for Life.  This includes Full-Time employees who have Medicare Part A along with the City's health plan.
  • Have not received Department of Veterans Affairs (VA) benefits within the past 3 months, except for preventive care.  If you are a veteran with a disability rating from the VA, this exclusion does not apply.
  • Not be claimed as a dependent on someone else’s tax return.
  • Not have a Health Care FSA (Flexible Spending Account) or HRA (Health Reimbursement Arrangement).  Alternative plan designs, such as a limited-purpose FSA or HRA, might be permitted.

Other restrictions apply.  Consult a tax, legal,l or financial advisor to discuss your situation.

To elect the HSA, employees MUST ensure their contact information is updated with the City and their physical address MUST be included because a PO BOX alone will not satisfy the physical address requirement.  If not, employees risk being denied enrollment.

Contribution Limits

Contribution limits are set by the Internal Revenue Service (IRS) and adjusted annually.  These limits are:

  • $4,500 for individual coverage in 2027
  • $9,000 for family coverage in 2027
  • $1,000 extra if you’re 55 or older, also known as a catch-up contribution.

 

Why Have An HSA?

You Own It
The money remains with you.  Your HSA rolls over from year to year, so you can continue to grow your savings and use it in the future.  This remains in effect even if you change jobs, change health plans, or retire.  Keep in mind, you must have active coverage in your employer's HDHP to participate in the HSA.

 

Tax Savings
HSAs help you plan, save, and pay for health care, all while saving on taxes.
• The money you deposit is tax-advantaged.
• Savings grow income tax-free.
• Withdrawals for qualified medical expenses are also income tax-free.

 

What Are The Benefits Of An HSA?

HSAs are tax-advantaged accounts that help people save and pay for qualified medical expenses.  Your HSA lets you:

  • Contribute money through payroll contributions before it’s taxed.
  • Grow your funds income tax-free.
  • Make income tax-free withdrawals for qualified medical expenses.
  • Carry over available funds from year to year.
  • Keep all your funds, even if you change jobs, switch health plans, or retire.
  • Pay for qualified medical expenses for a spouse or tax dependent
  • Consolidate any other HSAs you may have into one HSA for convenience.

 

What Can I Use My HSA For?

You can use the funds in your HSA to pay for qualified medical expenses like:

  • Doctor's office visits, lab fees, and medical procedures
  • Dental care, including extractions and braces
  • Vision care, including contact lenses, prescription sunglasses, and LASIK surgery
  • Prescription medications and over-the-counter (OTC) treatments
  • Go to optum.com/qualifiedexpenses to see a searchable list with more eligible expenses.

Keep in mind that when you are aged 65 or over, you can use your HSA as extra income. You have the option to withdraw your funds for anything, including nonqualified expenses, without incurring a withdrawal penalty.  However, you'll still need to pay income tax on withdrawals.

If you are under 65, you will be hit with a 20% penalty for using your HSA money on nonqualified expenses, plus you'll pay income tax.

 

Enrollment

To enroll in Optum Bank's Health Savings Account or make changes to your existing account, follow the process below:

 

All City of New Orleans employees (except for Outside Agencies: BOL, IDB, OPDA, OPDA-CS, OPCD and OPSO) 

All City of New Orleans employees (except Outside Agency employees) must enroll using the ADP system.

Click here to enroll: www.myadp.com

 

For Open Enrollment (Oct 1 – Oct 31)

  1. Log in to your ADP account.
  2. Click on the “Benefits” box found in the top menu.
  3. Click on “Health & Welfare” found in the dropdown box.
  4. Select “Benefits” to begin.
  5. Find the “Annual Enrollment” tile and click on “Enroll now”.
  6. Follow the prompts to make your election.
  7. Update and confirm your elections, and then download your confirmation.
  8. Review your Confirmation Statement.  If incorrect, return to the Benefits page to make changes.
  9. Agree to and sign the Optum Authorized Agent Agreement form (this will be performed through an electronic signature prompted by ADP).

 

For New Hires

  1. Log into your ADP account.
  2. Click on the “Benefits” box found in the top menu.
  3. Click on “Health & Welfare” found in the dropdown box.
  4. Select “Benefits” to begin.
  5. Find the “New Hire” tile and click on “Enroll now”.
  6. Follow the prompts to make your election.
  7. Update and confirm your elections, and then download your confirmation.
  8. Review your Confirmation Statement.  If incorrect, return to the Benefits page to make changes.
  9. Agree to and sign the Optum Authorized Agent Agreement form (this will be performed through an electronic signature prompted by ADP).

 

For Qualifying Life Events

  1. Log into your ADP account.
  2. Click on the “Benefits” box found in the top menu.
  3. Click on “Health & Welfare” found in the dropdown box.
  4. Select “Benefits” to begin.
  5. Find the “Report A Qualifying Change” tile and click on “Declare An Event”.
  6. Follow the prompts to make your election.
  7. Update and confirm your elections, and then download your confirmation.
  8. Review your Confirmation Statement.  If incorrect, return to the Benefits page to make changes.
  9. Agree to and sign the Optum Authorized Agent Agreement form (this will be performed through an electronic signature prompted by ADP).

 

Outside Agency employees: BOL, IDB, OPDA, OPDA-CS, OPCD and OPSO.

DO NOT enroll using the ADP system.  

You must work with your HR Team to:

  1. Ensure you are enrolled in the High-Deductible Health Plan (HDHP)
  2. Agree to and sign the Optum Authorized Agent Agreement form
  3. Fill out all appropriate forms in relation to your decision

Contact Us

To learn more about Health Savings Accounts (HSAs) and their benefits, contact Optum Bank.

Hours: Monday through Friday, 7:00 a.m. to 7:00 p.m. Central Time

Ways to reach Optum Bank: