The HSA Rollover benefit feature is a type of Rollback in that funds are reset at the end of a benefit period. However, unlike the Rollback, any funds not used are earmarked for investment to a group RRSP instead of reverting to the plan sponsor.
The plan sponsor can decide if unused funds should be reset each year or if the first year should be carried forward into the second and reset on a rolling annual basis going forward. The latter option is most popular not only for member budgeting purposes but allows for a more significant investment top up.
The feature is a blend of 2 separate plan options. The Canada Revenue Agency (CRA) doesn’t allow redirection of tax-free funds intended for health claims to an RRSP. On reset, a report is prepared to allow for accounting of necessary source deductions and checks on contribution room.
Beyond that, Blendable does all of the heavy lifting in terms of RRSP setup (if needed), online member signups, and facilitation of the bulk contribution to the provider (if the sponsor agrees to work with our partner).
Benefits
- Flexibility for the plan members
- Ability to reset funds on a rolling basis and allow plan members to budget for future expenses
- Plan members get the full value of every dollar, either to reimburse claims, or as an RRSP investment
- Complete cost control for plan sponsors
How it fits in today's market
- If your team is up at night crunching numbers, an HSA Rollover may be just what the doctor ordered. It also provides:
- True equity
- Flexibility
- Financial Wellness
The selling opportunities:
- Total equity with total value
- Businesses looking to provide benefits that wow new and current hires
- Control costs
- Clients you already manage financially
- Clients fed up with ever-increasing premiums
Details
Minimum Group Size
5
Minimum Contribution
$200/member/month
Fees
- 10% on contributions
Advisor Compensation
Recommended: 4% but variable (fee will change accordingly based on our 6% fee)
Eligible Expenses
CRA defined health expenses
Resetting Benefit Period Funds Logistics
There are 3 options for resetting unused funds:
- After each Benefit Period;
- After two Benefit Periods; or
- On a rolling basis, so only funds from the previous Benefit Period are reset.
- After year 1, no funds are reset.
- After year 2, unused funds from year 1 are reset.
- After year 3, unused funds from year 2 are reset, and so on.
Handling of Unused funds at end of Benefit Period
Returned to Plan Sponsor as a credit, Blendable may facilitate the transfer to be invested in a Group RRSP.
Unused funds when member leaves
Members have 30 days to submit claims, then funds are returned to Plan Sponsor. The Plan Sponsor can choose whether to invest these funds in the Group RRSP or not.
Eligible Dependants
Related by blood, marriage, or law who are financially dependent on member