Understanding a Health Savings Account
Otherwise known as an HSA, a health savings account can be funded with your tax-exempt dollars, by your employer, by a family member or by anyone else on your behalf. Dollars from the account can help pay for eligible medical expenses not covered by an insurance plan, including the deductible, coinsurance, and even health insurance premiums, in some cases.
Who is eligible for an HSA?
Anyone who is:
- Covered by a high deductible health plan (HDHP);
- Not covered under another medical plan that is not an HDHP;
- Not entitled to (eligible for AND enrolled in) Medicare benefits; or
- Not eligible to be claimed on another person’s tax return.
What is an HDHP?
A high deductible health plan is a plan with a minimum annual deductible and a maximum out-of-pocket limit as
listed in the following table. These minimums and
maximums are determined annually by the Internal
Revenue Service (IRS) and are subject to change.