Why do we have the HCSA?
On April 15, the University of Waterloo’s Board of Governors approved the establishment of a new HCSA benefit for members of the Faculty Association of the University of Waterloo (FAUW) effective May 1, 2025, in accordance with the May 1, 2024 FAUW arbitration award.
With the Memorandum of Settlement (MOS) between the University and the University of Waterloo Staff Association, effective May 1, 2026, eligibility for this benefit is extended to staff employees.
Are HCSA reimbursements taxable?
Reimbursements from an HCSA for eligible medical expenses are considered tax-free for the employee. This means the employee doesn't have to report the reimbursement as income on their tax return.
Will plan members receive another $300 HCSA allocation, effective each year, on May 1?
The HCSA provides an annual amount of $300 per benefit policy year (May 1 to April 30), with a second allocation of $300 provided in year two. The maximum fund in your account will not exceed $600 as HCSA balances from the previous year are forfeited if unused in a two-year period.
Note: At this time, we do not know whether that dollar amount will change for subsequent May 1 allocations – that will need to be established through future settlements or other agreements/arrangements.
Is there a deadline to use the funds?
Yes, HCSA balances are forfeited if unused in a two-year period. For example, any remaining HCSA balance from the May 1, 2025 allocation will be forfeited on May 1, 2027, and any remaining HCSA balance from the May 1, 2026 allocation will be forfeited on May 1, 2028, and so on.
In addition, please be mindful of GreenShield’s claims submission period as claims need to be submitted during the May to April Benefit Year in which they are incurred, plus the 60-day grace period. Or, if you are no longer participating in the University of Waterloo’s benefits program, you need to submit any HCSA claims to GreenShield within 30 days from your last date of coverage.
What happens if I choose to terminate my employment mid-year?
Eligible expenses incurred prior to employment termination are eligible for reimbursement through the HCSA as long as they are submitted to GreenShield within 30 days of employment termination.
What happens to my HCSA during periods of leave of absence?
As long as your extended health benefit is in place as an active employee, and you are a member of FAUW or a staff employee, you will have access to your HCSA for eligible expenses incurred during a leave of absence.
I was hired on or after May 1, but my GreenShield member record does not have an HCSA balance of $300. Is this correct?
Yes, this is correct. Employees who are eligible for the HCSA receive their $300 allocation on May 1, if they were actively employed at that time. Employees who are hired or become eligible between May 1 and April 30 receive their first $300 allocation on the following May 1.
What will happen with the HCSA balance (if any) for FAUW members who are retiring June 1, 2026, to April 1, 2027?
If a FAUW member has an HCSA, expenses incurred during employment will be eligible for reimbursement through their HCSA. Claims incurred during retirement are not eligible for reimbursement.
If a FAUW member has an HCSA on May 1, 2026, but then moves into the retiree extended health plan on June 1, 2026, they will be able to use their HCSA allotment for eligible expenses incurred in May 2025. If a FAUW member has an HCSA on May 1, 2026, but then moves into the retiree extended health plan on April 1, 2027, they will be able to use their HCSA allotment for eligible expenses incurred between May 1, 2026, and March 31, 2027.
What happens to the HCSA balance (if any) at retirement?
Retirees are not eligible for the HCSA; it’s only available to active employees who are members of FAUW or staff employees.
Claims incurred during employment but submitted for reimbursement during retirement will be eligible through the HCSA if received by GreenShield within the claim submission period. The claims submission period is the end of the Benefit Year (May – April) plus the 60-day grace period.
For example, if an eligible expense is incurred on June 10, 2025, and the FAUW member retires on July 1, 2025 (and has retiree extended health benefits coverage), the claim needs to be submitted to GreenShield before the end of June 2026.