October 2008

Health Savings Account

A new way to plan and pay for healthcare

A Health Savings Account (HSA) will be available to Consumer-Directed Health Plan (CDHP) participants beginning Jan. 1, 2009. An HSA gives you, as a healthcare consumer, more control over how and when you spend your healthcare resources.

How it works

info graphic

Some things to keep in mind if you decide to enroll in the CDHP for 2009:

Opening an HSA

In order to contribute to or receive TVA’s contribution, your HSA account must be established and opened.

• Employees enrolled in the CDHP will receive an enrollment link via e-mail from First Horizon Msaver, the HSA trustee, about two weeks after the close of enrollment to be used to open their HSA.

• Retirees will receive HSA enrollment information with their Medical Plan 2009 booklet that is mailed to their home.

Contributing to your HSA

You have the option of contributing to your HSA.

• Employees can set up payroll deductions for a pre-tax contribution to their HSA beginning Dec. 15, 2008. Here’s how:
– Access InsideNet. Click Self Service
– Enter your Employee ID and PIN.
– Click Money.

For contributions to start on the first paycheck in January, deductions must be set up by Dec. 22, 2008. However, you can set up or change your contributions at any time during the year.

• Retirees can mail contributions using a deposit slip from their HSA checkbook or automatically transfer monthly contributions from a personal checking or savings account.

Remember you own your account

You own your HSA. It is basically a checking account. Just remember, any HSA money used for purposes other than to pay for “qualified medical expenses” is taxable as income and subject to an additional 10% tax penalty. After you turn age 65, the 10% additional tax penalty no longer applies. Keep copies of your medical receipts to verify how you use your funds. You are responsible to the IRS for all types of withdrawals made from your HSA.

The money in your HSA earns tax-free interest daily. And as account balances grow, First Horizon makes available three ways you can invest your money: Mutual Fund Sweep Program, Self-Directed via Online Trading and Self-Directed via Trading Desk. You will want to choose the method that best meets your investment style.

For more information

Contact First Horizon Msaver Customer Care Center at 1-888-355-6124 or visit www.firsthorizonmsaver.com/tva. The Care Center and Web site are available 24-hours-a-day, seven days a week.

Employees: Review the Open Enrollment Newsletter that you’ll receive at your home. A list of frequently asked questions is available on eBenefits on InsideNet.

Retirees: Review the Medical Plan 2009 booklet that you’ll receive at your home. A list of frequently asked questions is available on www.tvaretirees.com under Health Care Benefits.

A list of qualified medical expenses is available on the IRS Web site, www.irs.gov, Publication 502, “Medical and Dental Expenses.”