Health Savings Account (HSA) Funding & Invoicing ____ __

Agenda HSA Funding & Invoicing Invoice for Administrative Fees File and Funding Process Unopened Account Funding (Pending Contributions) Email Notification Online Funding Report Sample Funding Report Appendix: Sample funding timeline, Pending Contributions scenario

Invoice for Administrative Fees ©2013 WageWorks Inc. All rights reserved.

Administrative Fee Invoice All administrative fees are billed on one single invoice The amount due includes participant administrative fee (all products being administered), any implementation fees, recurring monthly service fees, fees for customized projects Invoiced Monthly, on the 23rd of the month A participant service count is taken on the 20th of the month Payments are due based on what is stipulated in the Order Form (i.e. Net 30, Net 60, etc.) All Fees invoices will be sent from AccountsReceivable@wageworks.com. The Invoice Report on the WageWorks Employer Site provides all of the participant detail and reference information needed to support the invoice

HSA Funding Process ©2013 WageWorks Inc. All rights reserved.

Funding Overview HSA Funding HSA Funding No prefund or up front funding is required Deposit based funding Funds are due to WageWorks same day funds are made available to the member ACH Debit or Wire Transfer Option to Pend Plan Sponsor Contributions if the member has failed CIP When the funding file is sent to WageWorks the grand total of the contributions and deductions applied to the open HSA accounts will be debited from your bank account or the ACH Credit/Wire transfer is due to WageWorks on the next business day Daily Invoice Sent to client via email to reflect the amount and the instructions that the HSA funding amount will be debited from their account. All Funding invoices will be sent from FinOpsDept@wageworks.com. The amount is then applied to the employee accounts on the third business day. © 2017 WageWorks Inc. All rights reserved.

Funding Timeline Day 1 Day 2 Day 3 Submit Funding (FND) record If submitted by 12:00pm CST will process same day Funding Date determines processing date (if later than date of file load) Files posted after the Funding Date process when received Day 1 Funding Report generated (captures only funds that were able to post to open HSAs) Daily Funding Invoice sent to client Day 2 Funding due to WageWorks (WW will pull funds via ACH Debit) Funds visible on WageWorks’ website Funds are available in the account holder’s HSA (on card in evening) Day 3 © 2017 WageWorks Inc. All rights reserved.

HSA Funding Process Note the payroll or funding date within the file drives the process and the records will start processing as of that day. If the file has a future payroll date for an employee the funding process will not start until that day. It is important to ensure that HSA deductions have a funding date within the current tax year for the targeted HSA plan. Do not send a funding date prior to the start of the HSA plan year (i.e. 12/29 for a January 1st contribution) as this will cause the contribution to appear in the previous year’s tax records. The account activity report will show the grand total of contributions made by the employer only. Any payments, rollovers or post tax contribution information made by the employee is private and will not appear on the reports. Where possible, the Employer/Program Sponsor should not deliver any Funding (FND) records until the employee has addressed any vetting issues with the custodian and their HSA account is opened. Sample HSA funding timeline available in Appendix

HSA Funding File Corrections If Client sends a negative HSA Funding record amount, the record will reject. All reversals must be requested with the WageWorks Relationship Manager and processed by the WageWorks HSA Operations team The entire funding record amount must be reversed Partial amounts can not be reversed The reversed amount will appear as a credit on the next funding report, reducing the amount you are charged for that HSA contribution cycle Example: A $250 funding record is sent. The amount should have been $175 as that was what was actually taken from payroll An adjustment will reverse the $250 record A new record for $175 will need to be sent

Pending & Expired Contributions ©2013 WageWorks Inc. All rights reserved.

Pending Contributions This option is to address an HSA Funding record received for a participant when, at the time of receipt, the participant’s account has not been opened by the custodian (application not yet completed). You have the option as the Program Sponsor to have your plan set up to not reject a HSA funding record if the account is not yet open. Instead funding goes into a PENDING status and will be automatically posted when the HSA account is OPENED by the employee. Once the participant account is open all pending contributions will be applied and included on the next day’s HSA Contribution & Funding report for the grand total of the previously pended amount. *Sample Pending Contribution timeline available in Appendix

Expired Contributions According to IRS Regulations, in order to apply a contribution to a HSA in a given calendar year, the HSA must be opened before 12/31 of that same year. All pending contribution records in the WageWorks database with a Funding Date prior to 1/1/2015 will be expired shortly after 1/1/2015 if the HSA is not open as of 12/31/2014. This process will occur at the beginning of each calendar year. If an HSA participant has pending contribution records in the WW database at the time of termination and the account is not open, those contributions will also be expired.

HSA Pending & Expired Contributions Report This report should be used for several purposes: Review pending contributions and remind your employees to complete the HSA application in order for those contributions to post. Review expired contributions and determine if payroll deductions need to be returned to the participant on a post-tax basis.

Email Notification ©2013 WageWorks Inc. All rights reserved.

Sample HSA Funding E-mail From: HSAFundingServices@wageworks.com Sent: Thursday, January 08, 2010 1:01 AM To: Mr. Johnny Doe Cc: HSAFundingServices@wageworks.com Subject: HSA Contribution Funding Report: 12345/ Sample Company Inc. --------------------------------------------------------------------------------------------------------- Dear Valued Health Savings Account (HSA) Client: Please be advised the HSA Contribution Funding Report is now available on the WageWorks Employer website at https://employer.wageworks.com. The HSA Contribution Funding Report will reflect the status of your employees' most recent contribution activity at the Custodian. Please remit the Total Funding Due amount located on the HSA Contribution Funding Report within 1 business day. If funding by ACH Debit, this amount will be automatically deducted from your designated bank account. As a reminder, if the Total Funding Due amount is negative, no funding is needed. On the next HSA Contribution Funding Report, that amount will be credited and subtracted from the Total Funding Due for that settlement date. Please contact WageWorks at 1-866-924-3967 (1-866-WageWorks) if you have any questions.

‘HSA Contribution Funding Report’ ©2013 WageWorks Inc. All rights reserved.

Generate the HSA Funding Report Each funding date is listed in the drop down box relates to the “Funding Date” within the file (typically payday minus 2 days). The report shows the employee accounts that the funds were applied to and/or rejected. The report will also show the total amount due.

Sample HSA Funding Report

Appendix ©2013 WageWorks Inc. All rights reserved.

HSA Funding – Sample Timeline Tuesday 24th Run payroll Create FND with HSA contributions (using 25th as ‘Funding Date’) Load FND file to WageWorks (or early Wednesday) Wednesday 25th Load FND to WageWorks early in the day WW sends contribution records to BNY Mellon to post Contributions for yet-to-be-opened accounts are set to ‘Pending’, not sent to BNY Thursday 26th BNY reports to WW what was posted and rejected (due to closed account) Funding Report generated, captures Posted, Pending, and Rejected contributions Email notification of report sent to client, advises funds will be pulled the next business day Friday 27th Employee payday WW debits $ from client bank account, equal to the total $ amount of contributions POSTED. Contributions post on WW site, visible to employees HC Card balance updated late in day

Pending Contributions Scenario 9/25 – FND record with Jane’s $100 contribution loaded to WageWorks 9/25 – WW system checks status of Jane’s HSA, finds that she has yet to complete the application and open the account. Her $100 is classified as a Pending Contribution and is not sent to BNY to post. 9/26 – Funding Report generated, indicates client owes for 9/25 FND file’s total contribution $ amount, less Jane’s $100 and any other pending or rejected amounts 9/27 – WW debits client bank account for $ amount detailed on Funding Report; funds visible to employee on WW site 9/27 – 10/16 – Jane still does not complete HSA application, another $100 contribution is loaded via FND and set to Pending. 10/17 – Jane completes HSA application, BNY Mellon opens account 10/18 – WW receives open account status, sends Jane’s $200 in contributions to BNY to post (DAY 0) 10/21 (next business day) – Funding Report generated, indicates that client owes $200 for Jane’s now-posted contributions (DAY 1) 10/22 – WW debits client bank account for $ amount detailed on Funding Report; funds visible to employee on WW site (DAY 2)

©2013 WageWorks Inc. All rights reserved.