2021 Plan Year Information
What factors should I consider when choosing a Medical Plan option?
All of the Firm’s Medical Plan options offer comprehensive coverage and access to the highest quality of care through robust provider networks. The options differ in the level of benefits provided, how you pay for services and the types of tax-favored savings accounts you can use to pay for eligible health care expenses.
Some factors to consider are:
- Your cost of coverage (through paycheck contributions)
- Your cost of care (deductibles, coinsurance, copays and out-of-pocket maximums)
- Prescription drug coverage
- Preferred tax-favored savings accounts to help you pay for eligible health care expenses (Health Savings Account and Limited Purpose Flexible Spending Account for Option C or Health Care Flexible Spending Account for Options A and B)
What are the main differences between Option A, Option B and Option C?
The three Medical Plan options work similarly in that:
- They all cover the same medical services and generally the same prescription drugs, and you have access to the same network of providers.
- You must first meet a deductible before coinsurance or cost-sharing begins.
- For in-network preventive care, you do not need to meet the deductible and the services are covered at 100%.
- All options provide coverage for in- and out-of-network services, though your costs will be lower if you use in-network providers.
The biggest difference among the options is when and how you pay for care.
- With Option A, you’ll pay the most through your paycheck contributions, and the least when you need care.
- With Option C, you pay the least out of your paychecks, but potentially more when you need care due to the high deductible and out-of-pocket maximum.
- Option B falls in the middle of Options A and B in terms of when you pay.
If I enroll in Option C this year, do I have to enroll in Option C again next year?
No. Each year, you will have the opportunity to assess your health care needs during Annual Enrollment and decide whether you want to continue your coverage or elect a different option.
Why are the paycheck contributions lower for Option C than for the other options?
The consumer-driven design of Option C puts you in greater control of the health care dollars you spend. Your cost of coverage — what you pay through paycheck contributions whether you use care or not — is lower, but your annual deductible and out-of-pocket maximum are higher, meaning you will spend more money when you actually need care. You can use resources provided by the Firm to help you evaluate the cost and quality of services. Additionally, when you participate in Option C, you can contribute to a Health Savings Account to pay for — and even save for — eligible health care expenses now or in the future.
Does the annual deductible work the same way for all three options?
No. Option C has a combined medical and prescription drug deductible that is a “true family” deductible. This means that you and your covered dependents must meet the entire Family deductible before coinsurance begins for any covered individual.
Under Option A and Option B, covered dependents’ coinsurance begins once he or she reaches the individual deductible, or coinsurance will begin for any covered member of your family once the family deductible is met.
Does the annual out-of-pocket maximum work the same way for all three options?
Yes, the out-of-pocket maximums work the same way for all three Medical Plan options. Once you reach the individual out-of-pocket maximum, the Medical Plan begins to pay 100% of the cost of eligible services for the rest of the year, even if as a family the family maximum has not been reached.
Does Option C cover preventive care in the same way as the other plans?
Yes, all three plans cover in-network preventive services at no cost to you (100% covered).
Does Option C cover prescription drugs in the same way as other plans?
No. With Option C, you do not have to meet your annual deductible before the plan begins to share in the cost of preventive medications. However, you will be responsible for the entire cost of non-preventive prescription drugs until you reach your combined medical and prescription drug annual deductible.
Is there a difference in the network of doctors for the medical plan options?
No. For all three medical plan options, you may choose from two national health plan administrators, Cigna and UnitedHealthcare (UHC) (not available in Hawaii).
- For UHC, they are part of the UHC Choice Plus Network
- For Cigna, they are part of the Cigna Open Access Plus Plan Network.
It is recommended that you confirm that your doctors and providers will continue to participate in your plan’s network in the coming year.
What tools and resources are available to help me choose medical coverage?
Type “benefits” into your browser to visit the Benefit Center website and access tools to help make your Medical Plan elections:
- Compare your Medical Options to consider the detailed benefits coverage up to three plan options.
- Find a Doctor to check if your doctor, hospital or other provider participates in a network.
You can also:
- See Which Medical Plan Is Right for You? for an overview of the Medical Plan options.
- Call a Benefits Advocate for assistance and support to help you make the right choices for you and your family.
What happens if I do not enroll or if I waive Medical Plan coverage during Annual Enrollment or my benefits eligibility window?
If you do not enroll or if you waive Medical Plan coverage during Annual Enrollment, you will automatically be enrolled in your previous year’s election, except for HSA, FSA and Limited Purpose FSA elections. Details are available on the Default Benefits Coverage page.
If you don’t enroll in (or waive) benefits within 31 days of your start or eligible date, you will automatically be enrolled in Medical Plan Option B with your state’s preferred provider and Long-Term Disability for yourself only.
What are the main advantages of an HSA?
There are several advantages to having an HSA:
- Triple Tax savings:
- Pre-tax contributions lower your taxable income.
- Tax-free growth, even on investments.
- Tax-free distribution means you don’t pay taxes when you use HSA dollars to pay for eligible health care expenses.
- You can contribute: When you contribute to an HSA, you lower your taxable income.
- Investment opportunities: As soon as your account balance reaches $500, you can invest some or all of your HSA money above that $500 in a variety of investment funds.
- No “use it or lose it” rule: You don’t have to use all of your HSA money by the end of the year; it carries over from year to year, even in retirement.
- Higher before-tax savings opportunities: With an HSA in 2021, you can contribute up $3,600 per year for individual coverage or $7,200 per year for family coverage and, if you’re age 55+, you can contribute an additional $1,000 to your HSA.
- You can take it with you: You can use it if you switch medical plans in the future and after you leave the Firm. The money in your account follows you wherever you go.
- Your contributions are flexible: You can change or stop your HSA contributions at any point during the year.
If I enroll in Medical Plan Option C, do I have to contribute to an HSA?
No, you are not required to make HSA contributions, but the tax benefits and potential investment opportunities are good reasons to consider doing so.
The HSA can help you budget for the higher deductibles and out-of-pocket maximums of Option C and it is a tax-effective way to save for future qualified health care expenses. Additionally, since the per-paycheck premiums for Option C are significantly lower than the other medical plan Options, you may want to consider contributing the difference in your premiums to the HSA.
If I contribute to the HSA, will the entire amount of my annual contribution be available to me immediately?
No. If you choose to make paycheck contributions to the HSA account, your annual election will be divided by the number of paychecks in the year. The amount will be deposited into your account each pay period, and only the amount that’s been deposited to date is available. You may not “borrow” against contributions not yet deposited in your account.
For this reason, if you expect to have significant health care costs immediately, you’ll want to be sure you budget adequately to pay for them out-of-pocket. You can be reimbursed from your HSA as your contributions are added to your account.
Do I have to invest my HSA?
No, investing the funds in your HSA is optional.
The investment feature is flexible and allows you to invest a portion of your account balance. You must have a minimum cash balance of $500 in your HSA before you can begin investing your money. The HSA investment feature is designed to promote savings for future health care expenses. Reimbursements from your HSA for current health care expenses can only be taken from amounts that are not invested.
If I want to invest my HSA money, when can I start?
You can begin investing your HSA assets as soon as your cash balance is $500. (Some investment funds may require a minimum investment. If your account balance does not meet that minimum, you may not be able to invest in a particular fund immediately.)
What happens to my investments if my cash balance falls below $500?
If your balance falls below $500, you will not be able to purchase further investments until you replenish the cash account. The current investments you hold would remain invested in the account.
How does the HSA work when I need to pay a health care expense?
There are three simple ways to access your HSA balance to pay for eligible health care expenses:
- When you enroll in an HSA, you will receive a Your Spending Account (YSA) smart debit card to pay for eligible expenses. As long as there are funds available in your account, you can use the card to pay for expenses directly.
- Pay bills online: Request a payment to your provider, at no charge, through your HSA on the Benefit Center. No claim forms will be necessary, and your funds will be drawn directly from your account. View your account balance and recent payments online, too.
- Pay for an expense out of your own pocket and be reimbursed by your HSA. Request reimbursement by logging on to your HSA account on the Benefit Center. Or call a Benefits Advocate at 877-MSHR-411 (877-674-7411). You can make requests daily. Reimbursements can be deposited electronically into any account you specify, or you can choose to receive a paper check in the mail.
Can I take a distribution from my HSA for non-health care-related expenses?
If you use HSA money for non-qualified expenses and are under age 65, you’ll be taxed on that money at your income tax rate and assessed an additional penalty. Once you reach age 65, you’ll be taxed on HSA money used for non-qualified expenses, but you won’t pay the additional penalty.
Is there a limit on how much I can accumulate in my HSA over time?
There is no limit on the amount you can accumulate in your HSA over time. However, there is a limit on how much you can contribute to the account each year.
If my spouse also has an HSA, is there a limit to what we can contribute together?
If you and your spouse both have an HSA, both of you are treated as having Family coverage, even in a situation where you are not covered by your spouse’s medical plan or vice versa.
If your spouse has Family medical coverage and you have Individual coverage, both of you are treated as having Family coverage, even if the Family plan doesn’t cover you both. In either case, you can both make and receive HSA contributions as long as your total contributions don’t exceed the annual Family coverage contribution limit of $7,200 in 2021. The contribution limit is divided equally between you and your spouse, unless you agree on a different division.
For example, Bill (a Morgan Stanley employee) and Diana, both under age 55, are married with two children. Bill has Family coverage with Option C for himself and their children. Diana has Individual coverage for herself. Each establishes an HSA in 2021. Unless they agree to a different allocation, Bill can contribute $3,600 to his HSA and Diana can contribute $3,600 contribution to hers (each contributing half of the $7,200 limit). If both Bill and Diana were age 55 or older, each would be able to contribute an additional $1,000.
What if I already have an HSA from a previous employer?
If you have an HSA from a previous employer, you can roll over your account to the Morgan Stanley HSA if you enroll in Option C. You can also keep your accounts separate – it’s up to you.
What happens to my HSA if I decide to switch from Option C to a different option in the future?
If you decide to switch from Option C to a different option, the money in your HSA is yours to keep. If your new plan is a non HSA-qualified plan, or if you go to another employer that doesn’t offer a qualified HSA plan, you can still use your HSA to pay for out-of-pocket qualified health care expenses at any time, including after you retire. However, you won’t be able to continue making contributions to your HSA.
What happens to my HSA if I leave Morgan Stanley?
If you decide to leave Morgan Stanley, the money in your HSA is yours to keep. If your new employer offers a medical plan with an HSA, you should be able to roll over the amount from your Morgan Stanley HSA into your new plan. You should confirm with your new employer.
If your new employer doesn’t offer a qualified plan, you can still use your HSA to pay for out-of-pocket qualified health care expenses at any time. However, you won’t be able to continue making contributions to your Morgan Stanley HSA.
Can I have an HSA and a Health Care FSA at the same time?
No. If you have an HSA, you cannot contribute to an FSA. However, you can contribute to a Limited Purpose Health Care FSA.
What is a Limited Purpose Flexible Spending Account (FSA)?
A Limited Purpose FSA allows you to put aside before-tax money to pay for eligible dental and vision expenses if you are enrolled in Option C under the Medical Plan. Use your Limited Purpose FSA to pay deductibles, copays and coinsurance related to dental and vision expenses only. Other eligible health care expenses include eyeglasses, laser eye surgery and orthodontia. For a complete list, see IRS Publication 502. The Limited Purpose FSA is administered by Your Spending Account (YSA).
For 2021: Contribute up to the IRS maximum of $2,750.
To pay for eligible Limited Purpose FSA expenses, use the Smart YSA debit card to pay at the time of service or purchase, like you would use a debit or credit card. With the YSA debit card, you don’t have to fill out forms or wait for reimbursements. Eligible expenses will automatically be debited from the correct account—either the HSA or the Limited Purpose FSA—depending on which account the purchase is eligible for.
- For 2020: Eligible Limited Purpose FSA expenses must be incurred by December 31, 2020, and submitted for reimbursement by April 30, 2021.
- For 2021: Eligible Limited Purpose FSA expenses must be incurred by December 31, 2021, and submitted for reimbursement by April 30, 2022.
Use it or lose it: By law, any amount in your Limited Purpose FSA that is not timely claimed by you must be forfeited. Estimate your projected dental and vision expenses and potential tax-savings with the FSA Calculator on the Benefit Center website.
If I have a Health Care FSA in 2021 and I open an HSA for 2022, will I still have a grace period in early 2021 to spend any leftover FSA balances?
No, you must incur all 2021 Health Care FSA expenses by midnight on December 31, 2021, or your funds will be forfeited. The $550 Health Care FSA carry over feature is only available to use toward eligible health care expenses in 2022 if you enroll in a Health Care FSA and do not enroll in Medical Plan Option C.
What are my supplemental insurance options?
You have three supplemental insurance options available from Aflac: Accident, Critical Illness and Hospital Indemnity Insurance. Aflac pays a lump-sum benefit and you can use the money for anything you need, including medical expenses not covered by your insurance, transportation and travel to treatment centers, and ongoing living expenses like your rent, mortgage, utilities and groceries.
- Accident Insurance: Covers broken bones, fractures or burns that result from accidents and require emergency care or surgery.
- Critical Illness Insurance: Covers heart diseases, stroke, cancer, kidney failure, Parkinson’s, blindness, deafness or terminal illnesses.
- Hospital Indemnity Insurance: Covers eligible hospital admission, confinement, intensive and intensive care step-down unit due to covered accidental injuries, conditions or illnesses.
Additionally, the Firm offers special group rates on pet, auto, home, identity theft and personal excess liability insurances so that you can protect what’s most important to you. To learn more, search for “Voluntary Benefits & Insurances” in the Find it fast… search bar or visit the Employee Offers site (type “offers” in your browser from the office).
What is Long-Term Care Insurance?
A is designed to help you and your covered family members pay for certain expenses should you no longer be able to care for yourself on a daily basis for an extended period of time due to aging, illness or injury. Individual Long-Term Care policies pay an amount for covered services, up to applicable maximums; this kind of care is not generally covered by the Medical Plan.
The cost of Long-Term Care insurance is primarily based on your age and health and the options you choose when you apply for coverage.