Participating in the Account

MMC Benefits Handbook

You are eligible to participate in the Health Savings Account if you meet the eligibility requirements described in the Participating in Spending Accounts section.

In order to establish and contribute to the Health Savings Account, you must also:

be enrolled in the Marsh & McLennan Companies $1,600 Deductible Plan or $3,200 Deductible Plan,

not be covered by other health insurance (this rule does not apply to specific injury insurance and accident, disability, dental care, vision care, or long-term care),

not be enrolled in any Medicare benefit, and

not be claimed as a dependent on someone else's tax return.

Therefore you cannot elect the Health Savings Account if you or a family member participates in a traditional Health Care Flexible Spending Account, you are enrolled in Medicare, or have other non-high deductible health plan coverage (such as through your spouse's employer plan). However, if you participate in the Health Savings Account, you are also eligible to participate in Marsh & McLennan Companies' Limited Purpose Health Care Flexible Spending Account. The Marsh & McLennan Companies Limited Purpose Health Care Flexible Spending Account reimburses eligible dental, vision and preventive care expenses, as well as qualified medical expenses incurred after you meet your Marsh & McLennan Companies $1,600 Deductible Plan or $3,200 Deductible Plan deductible.

Important Note: It's up to you to make sure that you meet the tax requirements to establish and contribute to the Health Savings Account. Neither Marsh McLennan nor the Spending Account Service Center has the information or the responsibility to monitor your status.

Please consult your personal tax advisor for specific advice regarding your personal circumstances.

Do I have to be enrolled in the Company medical plan to establish and contribute to the Health Savings Account?

Yes, you must be a participant in the Marsh & McLennan Companies $1,600 Deductible Plan or $3,200 Deductible Plan to be eligible to establish and contribute to the Health Savings Account.

What coverage can make me ineligible to contribute to a Health Savings Account?

You are not eligible to establish or contribute to a Health Savings Account if you or a family member elects a traditional Health Care Flexible Spending Account in the same calendar year, or if you are enrolled in Medicare, Medicaid, Tricare or have other non-high deductible health plan coverage (such as through your spouse's employer plan).

However, if you participate in the Health Savings Account, you are also eligible to participate in Marsh & McLennan Companies' Limited Purpose Health Care Flexible Spending Account. The Marsh & McLennan Companies Limited Purpose Health Care Flexible Spending Account reimburses eligible dental, vision and preventive care expenses, as well as qualified medical expenses incurred after you meet your Marsh & McLennan Companies $1,600 Deductible Plan or $3,200 Deductible Plan deductible.

Important Information about Health Savings Accounts

Health Savings Accounts can help individuals save for qualified medical and retiree healthcare expenses on a tax-free basis.

You must meet certain tax requirements to establish and contribute to the Health Savings Account. Below is a general summary of some Health Savings Account features.

Anyone who is covered by a high deductible health plan (as defined in Internal Revenue Code Section 223) may establish a Health Savings Account, provided that they do not have other non-high deductible health plan coverage (such as through a spouse's employer plan).

Amounts contributed to the Health Savings Account belong to you and are completely portable. Although you cannot roll the Health Savings Account funds over into an IRA, you can roll the Health Savings Account funds into another Health Savings Account.

Every year the money not spent stays in the Health Savings Account and earns interest tax-free, just like an IRA.

Unused amounts in the Health Savings Account remain available for later years (unlike amounts in Flexible Spending Accounts).

Funds can be withdrawn from the Health Savings Account for either qualified medical or other expenses. If the amount withdrawn is used for qualified medical expenses, then the withdrawal is tax free. If the amount withdrawn is used for expenses other than qualified medical expenses, the amount withdrawn will be taxed and, for individuals who are not disabled or over age 65, subject to a 20% tax penalty.

To encourage saving for healthcare expenses after retirement, Health Savings Account owners between age 55 and 65 are allowed to make additional catch-up contributions to their Health Savings Accounts.

Although Marsh McLennan is providing you with a vehicle to establish a Health Savings Account, responsibility for meeting all the tax rules is yours. For example, to avoid taxation and possible penalties, it's up to you to make sure that any withdrawal you take from the Health Savings Account is for a qualified medical expense. Neither Marsh McLennan nor the Spending Account Service Center will monitor your distribution requests for tax compliance—it's up to you to do this and keep necessary tax records.

Additionally, just like an IRA, it's your responsibility to confirm your eligibility to contribute to a Health Savings Account under the tax rules. For example, if you have other medical coverage (i.e., through your spouse's employer plan) that is not high deductible health plan coverage, then you should not establish and contribute to the Health Savings Account. Also, if you have another Health Savings Account, you will have to make sure that your total contributions do not exceed the IRS limits.

Before making any decision, you should carefully consider whether or not you want to establish a Health Savings Account (assuming you are eligible to do so) and, if so, whether you want to use the Spending Account Service Center Health Savings Account or another trustee's Health Savings Account (which might have different features, for example, other investment options).

Note that this plan summary describes the Health Savings Account that Marsh McLennan makes available through the Spending Account Service Center, and not the rules that govern Health Savings Accounts generally or Health Savings Accounts available from other trustees. Moreover, it's important that you consult with a financial or tax professional for information about your personal tax situation.

An additional note on tax advice. The tax laws are complicated and often change. None of the information in this Handbook, including this plan summary, is intended to provide personal tax advice to any employee, terminated participant, beneficiary or alternate payee. Please consult your personal tax advisor for specific advice regarding your personal circumstances.