What is a Health Savings Account (HSA)?
A Health Savings Account (HSA) is a tax-advantaged account participants can use to pay for qualified health expenses they incur while covered under a high deductible medical plan. While HSA dollars may also be used to pay for non-qualified health expenses, such use will be subject to taxation. HSA dollars, contributed by the employer, employee or a qualified family member, accumulate over time with interest or investment earnings, are tax-free, are portable after employment and can be used to pay for qualified health expenses tax-free, or for non-health expenses on a taxable basis.
Health Savings Account is an alternative to traditional health insurance; it is a savings product that offers a different way for consumers to pay for their health care. HSAs enable you to pay for current health expenses and save for future qualified medical and retiree health expenses on a tax-free basis. You must be covered by a High Deductible Health Plan (HDHP) to be able to take advantage of HSAs. An HDHP generally costs less than what traditional health care coverage costs, so the money that you save on insurance can therefore be put into the Health Savings Account. You own and you control the money in your HSA. Decisions on how to spend the money are made by you without relying on a third party or a health insurer. You will also decide what types of investments to make with the money in the account in order to make it grow.
A Health Savings Account is an alternative to traditional health insurance; it is a tax advantaged savings account that offers a different way for consumers to pay for their health care. HSAs enable you to pay for current health expenses and save for future qualified medical and retiree health expenses on a tax-free basis.
A Health Savings Account is a special purpose account used in conjunction with a High Deductible Health Plan. HSAs offer you a different way to pay for health care. They enable you to pay for current health expenses and save for future qualified medical expenses, including retiree health expenses, on a tax-free basis. You must be covered by a High Deductible Health Plan (HDHP) to be able to take advantage of HSAs. An HDHP generally costs less than what traditional health care coverage costs, so the money that you save on insurance can therefore be put into the Health Savings Account. You own and you control the money in your HSA. Decisions on how to spend the money are made by you without relying on a third party or a health insurer. You will also decide what types of investments to make with the money in the account in order to make it grow.
A. The health savings account, or HSA, was created by federal legislation in 2003 and allows an individual to set aside pre-tax dollars for qualified medical expenses. The funds can roll over from year to year and you can also take them with you when you change jobs. Visit the IRS site at www.treas.gov/offices/public-affairs/hsa for detailed information about HSAs.
Related Questions
- I am enrolling in an HSA (Health Savings Account). Do I enter the employee contribution amount or the employee AND the employer contribution amount in the Annual Pledge field?
- I am enrolling in a HSA (Health Savings Account). Do I enter the employee contribution amount or the employee AND the employer contribution amount in the Annual Pledge field?
- What is a Health Savings Account (HSA)?
