How the Health Account Works
The Company will automatically set up a Health Account for you when you enroll in the HAP and will deposit the annual Company credit allocation into your account. In addition, the Company will credit your account with incentive credit amounts if you complete a qualifying health activity (health screening or tobacco free test/smoking cessation program). It may take three to six weeks for a credit to be reflected in your Health Account. Note that your Health Account is merely a recordkeeping account (also called a "notional" account). Incentive credits you earn will be credited to your Health Account, but the Health Account is not funded with cash. All reimbursements of eligible expenses are made from the Company's general assets. The account has no actual cash value that can be used elsewhere.
You may not contribute to the Health Account by making deposits to your Health Account through payroll deductions from your before-tax or after-tax pay.
For IRS purposes, the Company credits are not technically "paid" to you before going into the accounts, so they bypass all income tax withholding. Therefore, federal income taxes, Social Security taxes, Medicare taxes and state income taxes are not withheld from any of these credits, nor are any such taxes due when the money is used to pay for eligible expenses.