A VEBA is a tax exempt irrevocable trust arrangement for your employees to use for current or future out-of-pocket health-related expenses. The EHC VEBA doesn’t replace a group health insurance plan. It works with your plan to provide additional coverage options.
The EHC VEBA is administered by BPAS, a nationwide provider of retirement plan administration, actuarial, consulting, collective investment fund administration, and VEBAs. BPAS is an expert in one-stop solutions, a leader in innovative technology, and believes in hands-on service.
- Active Employees. Use money in your VEBA to pay health plan deductibles, co-pays and coinsurance as well as prescription drugs and certain insurance premiums. If you don’t spend all of the money in your VEBA by the end of the year, your balance will simply roll into the next year. You’ll accumulate funds over time which means you’ll have money to pay for health expenses when you retire.
- Post-retirement. Employers can contribute funds to help employees, their spouses and eligible dependents pay for medical expenses even after retirement. Use post-retirement VEBA funds to pay for medical premiums and long-term care premiums. Employers can choose to make contributions throughout working life or convert accumulated unused sick time, vacation, severance money, or other longevity-based benefits.
- Tax Advantages. The EHC VEBA is a tax-advantaged account so employees aren’t taxed on their employer’s contributions to it. Plus, the EHC VEBA accrues interest that grows on a tax-free basis. Since VEBAs have to be used for eligible medical expenses, distributions are tax free, too.
- Full Coverage. All medical expenses defined under IRS Code Section 213(d) are eligible under the EHC VEBA including:
- Co-pays, prescriptions, and deductibles
- Dental, medical, and vision services
- Medicare Part B and D
- Premiums for long-term care insurance
- Free Debit Card. We offer debit cards as part of our standard service so accessing funds in your VEBA is easy. Simply pay for eligible expenses at the point of purchase just like you would with a credit card. Funds are automatically paid to the provider out of your VEBA. Plus, there are no transaction fees associated with the card. Download this information flyer to learn more. Benny Debit Card Participant (PDF)
|Federal Income Tax (appx. 25%)||-$6,250||-$0|
|FICA Tax (appx. 7.65%)||-$1,912||-$0|
|Amount you get||$16,838||$25,000|
With the EHC VEBA, you’ll find all of the tools to manage your account with the simple click of a mouse:
- Investment elections/reallocate account balance
- Interactive banner messaging
- Fund fact sheets and prospectuses
- Online statements
- Statement on demand capabilities
- Online claim submission
- Claims status and history
- Plan documents
- Pertinent forms
- Educational materials
- Legislative information