What are HSA-eligible plans?
One way to manage your health care expenses is to enroll in a
A type of savings account that lets you set aside money on a pre-tax basis to pay for qualified medical expenses. By using untaxed dollars in a Health Savings Account (HSA) to pay for deductibles, copayments, coinsurance, and some other expenses, you may be able to lower your overall health care costs. HSA funds generally may not be used to pay premiums.
Refer to glossary for more details.
-eligible plan (also called a High Deductible Health Plan (HDHP)) and open an HSA, a type of savings account that lets you set aside money on a pre-tax basis to pay for qualified medical expenses (like some dental, drug, and vision expenses).
How HSA-eligible plans can lower your costs
- If you enroll in an HSA-eligible plan, you may pay a lower monthly premium but have a higher (meaning you pay for more of your health care items and services before the insurance plan pays).
The amount you pay for covered health care services before your insurance plan starts to pay. With a $2,000 deductible, for example, you pay the first $2,000 of covered services yourself.
Refer to glossary for more details.
- If you combine your HSA-eligible plan with an HSA, you can pay that deductible, plus other qualified medical expenses, like , coinsurance, and more, using money you set aside in your tax-free HSA.
A fixed amount ($20, for example) you pay for a covered health care service after you've paid your deductible.
Refer to glossary for more details.
- So, if you have an HSA-eligible plan, and don’t need many health care items and services, you may benefit from the lower monthly premium.
- If you need more care, you’ll save by using the tax-free money in your HSA to pay for it.
- Your HSA balance rolls over year to year, so you can build up reserves to pay for health care items and services you need later.
What's considered an HSA-eligible plan?
Under the tax law, HSA-eligible plans must set a minimum deductible and a limit, or maximum, on out-of-pocket costs for both individuals and families.
- The minimum deductible is the amount you pay for health care items and services per year before your plan starts to pay.
- The maximum out-of-pocket costs are the most you’d have to pay per year if you need more health care items and services.
Notice:
HSA-eligible plan deductibles are often significantly higher than the minimums and can be as high as the maximum out-of-pocket costs.
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