How Does the LSA Compare to the FSA & HSA?
Every employee has a different lifestyle, family, and health care needs. Allowing employees to pick and choose benefits can help boost morale, show more productivity, and result in loyal, hard-working employees.
There are three employee spending accounts – LSA, FSA, and HSA – that all have different purposes for the employee. But how do the long-standing FSA & HSA compare to the newer Lifestyle Spending Account benefit option?
The Lifestyle Spending Account (LSA) is the most versatile employee benefit employees can use to help pay for products and services to create a healthy lifestyle not covered by insurance. The BASE® LSA is a post-tax, employer funded account that allows for employees to be reimbursed for expenses that relate to their lifestyle. It is available to employers who want to promote healthy habits and the overall well-being of their employees.
LSAs are fully customizable, so employers can tailor how the employees use the LSA according to their needs and lifestyle and can also target for specific purposes, be it physical, emotional, or financial.
The Flexible Spending Account (FSA) is a health benefit that employees can use to help pay for health care expenses not covered by insurance. The BASE® FSA is a pre-tax, pre-determined maximum by the IRS, employee-funded account that is set up by the employee to pay for expenses that relate to health care. It is available to employers who want to help their employees pay for their eligible out-of-pocket health care expenses.
FSAs are customized and can include benefit roll-over, grace period, or “use-it-or-lose-it,” but the FSA empowers employees to pay for the health care expenses incurred during the plan year.
The Health Savings Account (HSA) is a health benefit that employees can use, paired with a High Deductible Health Plan (HDHP), to save and pay for health care expenses not covered by insurance. The BASE® HSA is a pre-tax, pre-determined maximum by the IRS, employee-funded account that is set up by the employee to save and pay for the expenses that relate to health care. It is available to employers who want to help their employees save and pay for eligible health care expenses, but also create a retirement portfolio and investment opportunities for the future.
HSAs are customized to roll over year-to-year with a triple tax advantage that empowers employees to make the most out of every saved health care dollar.
In comparing these benefits, employees can only use the FSA and HSA for health care expenses, while the LSA covers a broad range of expenses to promote well-being. The LSA is also a post-tax employer-funded benefit, while the FSA and HSA are pre-tax employee-funded benefits.
To learn more about the BASE® LSA, FSA, and/or HSA, contact BASE® at 888.386.9680 or visit www.BASEonline.com.
Share on Facebook
Share on Twitter
Share on LinkedIn