What is an HSA?

An HSA is part of a two-fold approach to covering your health care costs.

Part One: High-Deductible Health Plan (HDHP)

You begin by selecting a high deductible health plan (a.k.a. HDHP, catastrophic or major medical). With this type of plan, you pay your day-to-day health expenses until your deductible is met. Because you assume more responsibility, these plans can cost significantly less than their more comprehensive counterparts.

Part Two: Health Savings Account (HSA)

For day-to-day medical expenses, you use money you have deposited in your own personal health savings account. The HSA is different from a regular savings account because your deposits are tax deductible and you can invest your savings as if it were an IRA. Any money left over at the end of the year remains yours, indefinitely.

Things to consider:

  • Your anticipated health care expenses
  • How active you want to be in your health care spending
  • Your personal financial situation
  • Other coverage you may be enrolled in through your spouse, as this may disqualify you as eligible for an Individual HSA

A conversation with your tax advisor might help you make the decision.

Are you enrolled in an HSA through your employer?

Let’s get you to the right spot.

You are not eligible for an Individual HSA if you are:

  • Claimed as a dependent on someone else’s taxes
  • Covered by any other health plans not considered HDHPs, including Medicare and comprehensive flexible spending accounts
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