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Workplace Plans
Plan Ahead for Health Costs With a Retirement Health Savings Account
An RHS account helps you prepare for one of retirement’s biggest expenses—health care. Sponsored by your employer and administered by MissionSquare, the RHS program offers a tax-advantaged way to save for future medical costs.
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What is a Retirement Health Savings Account?
An RHS account is an employer-sponsored savings vehicle designed to help employees cover medical expenses in retirement. Contributions—made by you, your employer, or both—are set aside exclusively for qualified medical expenses. These accounts offer triple tax advantages: pre-tax contributions, tax-deferred growth, and tax-free withdrawals for eligible expenses.
Enrollment & Eligibility
How To Enroll
Participation in the RHS program is mandatory for eligible employees. Your employer defines eligibility and provides enrollment materials. Contributions may include mandatory employee compensation or accrued leave, and employer contributions may be fixed or discretionary.
Investing Your RHS Funds
At enrollment, a default investment—often a target-date fund—is selected based on your age. You can change your investment choices anytime, selecting from a range of options including stable value funds, bond funds, equity funds, and model portfolios.
Tax Advantages
An RHS account offers several tax benefits, including:
- Pre-tax contributions, if applicable, reduce your taxable income.
- Tax-deferred earnings.
- Tax-free distributions for qualifying medical expenses.
[b3-regular]A target-date and target-risk fund is not a complete solution for all of your retirement savings needs. An investment in the fund includes the risk of loss, including near, at or after the target date of the fund. There is no guarantee that the fund will provide adequate income at and through an investor's retirement. Selecting the fund does not guarantee that you will have adequate savings for retirement. [/b3-regular]
Using Your RHS Account
Requesting Reimbursements
To request reimbursements, you must be eligible (typically at retirement, separation from an employer, or disability) and have qualifying medical expenses. Submit claims online, by mail, or by fax with supporting documentation such as receipts or Explanation of Benefits.
What’s Covered: Qualifying Medical Expenses
Eligible expenses include insurance premiums (medical, dental, vision, Medicare Part B), deductibles, copayments, and services like therapy, home health care, and durable medical equipment. Refer to IRS Publication 502 for a full list.
Protecting Your Loved Ones
In the event of your death, your RHS account transfers to your surviving spouse or eligible dependents. They can continue using the funds for qualifying medical expenses, helping preserve your legacy and reduce their financial burden.
Recurring Reimbursements
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Set up monthly or quarterly reimbursements for recurring expenses like insurance premiums. Notify your administrator of any changes to amounts or to stop payments.
RHS Tools and Resources
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Use MissionSquare’s Retiree Health Cost Estimator to plan and manage your RHS account effectively.
RHS Investment Funds
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Choose from a wide array of investment options including target-date funds, bond funds, equity funds, and model portfolios tailored to your risk tolerance and retirement timeline.
Frequently Asked Questions
How do I know if I’m eligible for RHS?
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Eligibility is defined by your employer, but typically it is defined at retirement/separation of service. Contact your HR department or MissionSquare for details.
What documentation is needed for reimbursements?
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Submit receipts, Explanation of Benefits, or itemized bills showing the patient name, service date, and out-of-pocket amount.
Can I use RHS funds for long-term care?
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Yes, qualified long-term care premiums are eligible under IRS guidelines.
NOTE: Long-term care expenses are not eligible for reimbursement under RHS. Only long-term care premiums are permitted under RHS.
Have More Questions?
Call (800) 669-7400 to speak with a representative weekdays 8:30 a.m. to 9:00 p.m. ET.
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[b3-regular]CFP® professionals are registered representatives and investment adviser representatives of MissionSquare Wealth Management. MissionSquare Retirement is an SEC registered investment adviser and the parent company of MissionSquare Wealth Management. [/b3-regular]