We’ve talked previously about the importance of offering benefits to your employees. Attract, retain, reward – that’s the name of the game.
We also know what it’s like to be locked into a one-size-fits-all health benefits plan: they’re rigid, you don’t have complete control over your budget, and you might have to pre-fund benefits your employees don’t even use.
These rigid plans didn’t work for us, and they won’t work for you. That’s why we sought a solution for business owners across Canada – allow us to introduce the HSA (health spending account).
What is an HSA?
Broadly, an HSA is a Canada Revenue Agency-approved method of providing your employees with health benefits like medical, vision and dental care. It’s an individual account with a set amount that your employees and their family use to reimburse their health expenses.
So, what sets an HSA apart from other health benefits packages? Two critical components: cost and flexibility. HSAs are the most tax-efficient way to offer benefits; as an employer, you can write off 100% of the costs, and all the reimbursed expenses are tax-free for your employees (except in Quebec).
Plus, PayEvo HSAs are flexible – you don’t have to pre-fund benefits, you control the costs, and your employees control what they spend their coverage on.
Not sure how to get started? No problem – book a call with our benefits architects. We tailor benefits plans to your business – whatever your budget, we have a plan for you.
Why should you offer an HSA?
Remember – you should offer benefits to attract, retain and reward the best talent. But why is an HSA the best option for your business? Considering the cost and flexibility perks, there are several reasons an HSA could aid you and your employees.
Let’s break it down:
1. Reduce healthcare expenses
HSAs can help reduce the overall cost of healthcare for you and your employees. For instance, employees can use pre-tax dollars to pay for out-of-pocket medical expenses, reducing the overall cost of medical care.
2. Give your team control
HSAs put your team in control of their healthcare expenses – they can fund the medical needs that are most important to them rather than being restricted to a predetermined list.
3. Amplify your recruitment
We’ve talked a lot about how important benefits are to attracting and retaining talent. In fact, 83 per cent of Canadian workers want more health benefits than they’re provided. By offering an HSA, you can stand out from the crowd without breaking the bank.
5. Grant your employees a tax break
You can also help your employees save money on taxes. Contributions to an HSA are made with after-tax dollars, but withdrawals for qualified medical expenses are tax-free. This can help employees save money on taxes and lower the overall cost of medical care.
6. Provide healthcare options
Your team can use their HSAs to pay for various qualified medical expenses. The list is extensive. As well as medical and dental treatment, HSAs can cover eyeglasses, contact lenses, and specific alternative treatments (such as chiropractic care and acupuncture).
7. Assist in your team’s financial planning
Of course, HSAs will cover your team’s current medical expenses, but you can also roll over the funds in an HSA for 12 months. Keep in mind that your employees have to use their funds in a two-year period.
8. Don’t stress over the setup
Nobody wants to spend hours wrangling with products and insurance companies just to set up benefits. Luckily, HSAs are easy to set up and administer. We offer HSAs and provide resources to help you understand how to easily set up and manage the accounts for your employees.
9. Harness the best option for small businesses
HSAs are an excellent choice for small businesses. Because of their flexibility and simple setup, they’re perfect for the small business owner who may not have the time or resources to offer more comprehensive health insurance plans.
Understanding HSAs: FAQs
Who should offer HSAs?
Every business owner with an incorporated company should offer an HSA. It’s the most tax-efficient way to offer benefits.
Who qualifies for HSA coverage?
As an employer, all your employees qualify for HSA coverage.
Is an HSA right for my business?
Generally, HSAs are a fantastic option for businesses of all sizes. But if you’re unsure, schedule a chat with our benefits architects – we’ll help you determine if an HSA is right for you.
What expenses are covered under HSAs?
As well as traditional medical coverage (health, dental, vision), your team can use HSAs to cover more specific wellness options. View our brochure for the complete CRA-approved list: