Health Savings Accounts (HSAs) are a great health benefit tool. With unmatched tax benefits, the HSA can do so much for health care expenses, financial goals, and retirement. The BASE® HSA offers the opportunity to make the most out of every health care dollar and invest in the future.
The Health Savings Account (HSA) is a type of savings account set up for individuals enrolled in a qualifying High Deductible Health Plan (HDHP) to save and pay for eligible health care costs. Furthermore, an HSA is a triple tax-advantaged account that helps employees pay for their health care expenses and allows for the opportunity to save for the future, invest funds to build wealth, and create a powerful tool for a retirement portfolio.
FACT 1: Triple Tax Benefits. With the HSA, contributions into the HSA are tax-free, the funds in the HSA grow on a tax-free basis, and withdrawals for qualified health care expenses are tax-free as well.
FACT 2: NO “Use-it-or-Lose-it.” Unlike the FSA, the funds are not forfeited at the end of the year. The HSA balance can continue to grow from year to year.
FACT 3: Funds Can be Used for Prior Year Health Care Expenses. As long as the HSA was established before the incurred health care expense, the HSA can be used to reimburse the health care expense years later.
FACT 4: Retirement Benefits. After hitting the age of 65, the HSA can be used for qualified medical expenses or as a retirement fund to live off.
FACT 5: HSAs+FSAs Don’t Mix, But... An individual may not have an HSA if they have other health benefits that pay for health care expenses before the high deductible has been met, such as a Flexible Spending Account. However, an individual may have a Limited Purpose FSA to pay for their qualified dental and vision expenses.
FACT 6: Employer Contributions. Many employers will incentivize their employees to enroll in a High Deductible Health Plan (HDHP) and HSA, encouraging them to become better health care shoppers. Many will contribute a specific amount each year to the HSA or match the employee contributions as an incentive.
FACT 7: Use for Dependents. Whether the participant is on a self-only or family health insurance policy, the money in the HSA may also be used for health care expenses for their spouse and current tax dependents.