Can an employer offer incentive dollars to an employee's HSA for participating in a health improvement program? Would this cause any concerns with comparability rules?

Incentives for wellness programs can only be offered if the HSA contributions are made through a Section 125 Cafeteria Plan. Since comparability is not applicable to contributions made within a Section 125 plan, the issue is how the offering of incentives for a program that not everyone can participate in might present discrimination issues. In other words, the employer might fail non-discrimination testing. Therefore, our recommendation would be to make sure that all employees are given the same opportunity for earning incentive contributions.

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HSAs are available to help pay for current qualified medical expenses as well as to save for future expenses, all in a tax-exempt account.

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