Get Started

Our 3 steps to understanding and selecting the right benefits for you

I

Watch the Video

Why Group Benefits?

2. Find the right approach

3. Get the Quote

Group Programs

Our most popular plans with premium coverage and stable rates

Pooled Programs

More Programs
5

Essentials

5

Lifestyle

5

Franchise Program

9

Specialty Programs

5

Experienced Based Programs

5

Group RRSP

Individual Solutions

Individual Insurance for your and your family

9

Individual Insurance Tools

5

Individual Insurance Planner

5

Simplified Planner

9

Contact us

9

Our Story

9

FAQ and Forms

5 Important Things to Know About HSA Accounts in Canada

Benefits, Uncategorized

The health care system in Canada is very different from the US. You may have heard of Health Savings Account (HSA) accounts, but did you know that they’re a little different in Canada? Here are the 5 main differences between HSA accounts in Canada and the US, and what you need to know about them.

1. All employees are eligible for HSA in Canada:

HSA in Canada is a tax-effective employee account. It is sponsored by the employer to reimburse health care and dental expenses. The employer deposits a predetermined amount in the health savings account and all employees can benefit from it. Here is a detailed guide on how HSA works in Canada.

Only individuals covered under high deductible health plans can create a health savings account in the US. A person with an existing health plan or Medicare is not eligible for HSA in America.

2. HSA in Canada is primarily sponsored by employers:

A health savings account is set up to provide benefits to the employees that are not covered by the existing health care plan. In Canada, HSA is a benefit to the employees to reimburse their medical expenses.

HSA in the US can be funded by both the employer and the employee. The amount of contribution is at their discretion.

3. No limits on annual contribution:

There is no upper limit on the amount of contribution to the HSA account. The employer can make a budgeted contribution or reimburse as the claims occur. The contract between the employer and the employee is the only governing factor of the amount credited to the account.

The HSAs in the US have a limit on the annual contribution amount. The maximum deposit in the HSA is $3600 for individuals and $7200 for families. People above the age of 55 can make an additional contribution of $1000 to their health savings account. The upper limit applies to the total contribution by the employer and employee.

4. Withdrawals are allowed only for permissible medical expenses:

HSA in Canada reimburse the following expenses

  • Medical and dental expenses exceeding the health plan coverage.
  • Deductibles
  • Expenses not covered by traditional health care.

These reimbursed expenses are non-taxable for the employees.

HSAs in the US allow withdrawal from the account for IRS-approved medical expenses. However, there is a provision to withdraw funds for non-medical expenses. In such cases, the amount withdrawn is taxed as the individual’s income and also attracts an additional 20% penalty.

5. HSA in Canada serve as an alternative to traditional insurance plans:

HSA presents as an alternative to small-scale employers to provide health benefits to employees and write them off as business expenses. It gives employers a chance to develop a flexible health plan while saving tax.

HSAs in the US are perceived as an add-on to existing insurance and an investment avenue. The funds in the HSA account can be invested and grown tax-free. The fund does not terminate and can be carried forward by the employee even after moving to another job.

Conclusion

HSAs are a good resource to have. Hopefully, this article has helped you to understand them a bit better and outlined 5 Important Things to Know About HSA Accounts in Canada.
Have more questions? Contact us for more information.

Follow Us On Social Media!

Looking at Benefit Plans for your business?

Health and Dental Premium Relief Extended for June

Health and Dental Premium Relief Extended for June

The health and dental premium reduction we provided to plan sponsors for April and May gave relief in real-time. In implementing this, it reflected the anticipated decrease in plan member health and dental claims due to pandemic closure of service providers. We...
Support For Small Businesses

COVID 19: Support For Small Businesses In BC

Small Business BC Support For the latest information on small business supports, resources and advisory services during COVID-19, please visit Small Business BC. Advisors are ready to help by phone at 1-800-667-2272, email and daily digital meetups. See how COVID-19...
Prescription Drug Cost

Prescription Drug Costs Breakdown

Understanding the total cost of a prescription drug claims means learning the 3 main components: 1) Ingredient Cost Actual cost the pharmacy pays the drug company or wholesaler to buy the drug. 2) Pharmacy Markup Percentage charged to cover the expenses involved in...
Why we ask for detailed quote information

Why Ask For Detailed Quote Information?

Why we need detailed quote information from your current plan? Detailed Quote Information tells us a story, enabling us to create the right solution Getting involved in a Group Benefits program is different than purchasing a commodity. Most consumers are...
long term disability

Non Evidence Maximums for Long Term Disability plans

ClearBenefits.ca is pleased to announce new Non-Evidence Maximums (NEM’s) for Long Term Disability in our Pooled Programs. The following enhanced LTD Non Evidence Maximum table applies to new business in both our Essentials and Lifestyle programs:                    ...

Looking for a Company Plan?

Receive a personal call from an advisor right now!

Great! An advisor will reach out to you now. Please check your inbox