Health Savings Accounts (HSA)

A Health Savings Account (HSA) is a tax-advantaged medical savings account available to taxpayers in this country. The health care portion of an HSA is in the form of a High Deductible Health Plan (HDHP).

Health Savings Account are similar to medical savings account plans that were authorized by the federal government before HSA plans.

HSAs differ in several ways from MSAs. Perhaps the most significant difference is that employers of all sizes can offer an HSA option to their employees, in addition individuals and families can purchase HSA plans on their own. MSAs were limited to employers who employed 50 or fewer people.

Who Benefits from HSAs?

HSA plans clearly benefit two groups of people, those who are healthy and those who are very unhealthy or have large monthly expenses for prescription drugs. This is due to the fact that everything you spend on prescriptions & office visits are credited towards the deductible. Once the deductible is met, HSA plans will pay for medications with the same copay as all other medical expenses. This could limit the maximum out of pocket costs in some cases.

The premium for a high deductible health plan is generally less than that for a traditional indemnity health plan.

HSAs also give the flexibility not available in some traditional health plans to pay on a pretax basis for qualified medical expense not covered in standard health plans, this may include dental, orthodontics, vision, and non-prescription medications.

Over a period of time, if medical expenses are low and contributions are made regularly to the HSA, the account can accumulate significant assets that can be used for health care tax free or used for retirement on a tax-deferred basis.

Where Can I find an HSA?

HSAs are growing in popularity and hence there are an increasing number of options available for HSA shoppers. As with other health insurance plans, you not all HSA plans are created equal and you should compare the underlying benefits and rates of various health plans side-by-side before making your purchase decision.

Enter your zip code above to be connected with leading health plans offering HSA options in your state.