Understanding Consumer Directed Health Plans (CDHP) with Health Savings Accounts (HSA)

CDHPs are medical plans with lower monthly premiums, offset by a higher deductible and out-of-pocket max. These plans are paired with a Health Savings Account (HSA), which WSU contributes $58.34/individual or $116.67/family monthly. You may make your additional pre-taxHSA contributions.

• The HSA 2026 max contribution limit is $4,400/employee or $8,750/families. This includes both employer and employee contributions, as well as the $125 SmartHealth Incentive if earned. Employees who are 55+ may contribute an additional $1000/yr.
• HSA funds can be used on IRS-qualified out-of-pocket medical expenses, and carry forward year-to-year.
• Contributions made through payroll deduction lower your federal and FICA taxable income. Contributions made directly to HealthEquity can be reported on your income tax return to reduce federal/state income taxes, but not FICA taxes.
• HSA contributions are tax-free, the earnings are tax-free, and the funds remain tax-free if utilized for eligible health expenses.
• CDHP enrollees must meet IRS eligibility requirements. If near or over age 65, consider speaking with a tax advisor; Medicare enrollees may not also contribute to a HSA, and if they do there are tax implications.
• During OE, CDHP/HSA enrollees may also enroll in a Limited FSA to cover eligible vision and dental expenses in 2026.
• Visit HSA info or HRS Open Enrollment for more information.

Questions: 509-335-4589 or [email protected] with questions.