What is a 'Health Savings Account - HSA'

A Health Savings Account (HSA) is an account created for individuals who are covered under high-deductible health plans (HDHPs) to save for medical expenses that HDHPs do not cover. Contributions are made into the account by the individual or the individual's employer and are limited to a maximum amount each year. The contributions are invested over time and can be used to pay for qualified medical expenses, which include most medical care such as dental, vision and over-the-counter drugs.

Explaining 'Health Savings Account - HSA'

The Health Savings Account has three major tax savings: the money contributed into the account is tax deductible, it grows tax free, and certain withdrawals are tax free if they are for qualified medical expenses. To qualify for an HSA , you must have coverage from a high-deductible health plan and you must not be enrolled in Medicare or be listed as a dependent on another person's tax return.

Further Reading

Health care spending after adopting a full-replacement, high-deductible health plan with a health savings account: a five-year study
papers.ssrn.com [PDF]
… Participants pay healthcare expenses from their MSA up to the amount of the insurance … out-of-pocket costs for HSAs linked with HDHPs, lower income and less healthy households are … conditions could be financially burdened even more if they participated in HSA health plans …

Effects of health savings account-eligible plans on utilization and expenditures.
www.ncbi.nlm.nih.gov [PDF]
… Participants pay healthcare expenses from their MSA up to the amount of the insurance … out-of-pocket costs for HSAs linked with HDHPs, lower income and less healthy households are … conditions could be financially burdened even more if they participated in HSA health plans …

Balancing the goals of health care provision and financing
www.healthaffairs.org [PDF]
… Participants pay healthcare expenses from their MSA up to the amount of the insurance … out-of-pocket costs for HSAs linked with HDHPs, lower income and less healthy households are … conditions could be financially burdened even more if they participated in HSA health plans …

Why don't the poor save more? Evidence from health savings experiments
www.aeaweb.org [PDF]
… Participants pay healthcare expenses from their MSA up to the amount of the insurance … out-of-pocket costs for HSAs linked with HDHPs, lower income and less healthy households are … conditions could be financially burdened even more if they participated in HSA health plans …

Evolution and early evidence of the impact of consumer-driven health plans: from e-commerce venture to health savings accounts
www.tandfonline.com [PDF]
… Participants pay healthcare expenses from their MSA up to the amount of the insurance … out-of-pocket costs for HSAs linked with HDHPs, lower income and less healthy households are … conditions could be financially burdened even more if they participated in HSA health plans …

The Macroeconomics of Health Savings Accounts
papers.ssrn.com [PDF]
… Participants pay healthcare expenses from their MSA up to the amount of the insurance … out-of-pocket costs for HSAs linked with HDHPs, lower income and less healthy households are … conditions could be financially burdened even more if they participated in HSA health plans …

Use of Health Savings Accounts Among US Adults Enrolled in High-Deductible Health Plans
jamanetwork.com [PDF]
… Participants pay healthcare expenses from their MSA up to the amount of the insurance … out-of-pocket costs for HSAs linked with HDHPs, lower income and less healthy households are … conditions could be financially burdened even more if they participated in HSA health plans …

How much more cost sharing will health savings accounts bring?
www.healthaffairs.org [PDF]
… Participants pay healthcare expenses from their MSA up to the amount of the insurance … out-of-pocket costs for HSAs linked with HDHPs, lower income and less healthy households are … conditions could be financially burdened even more if they participated in HSA health plans …

Medical savings accounts: assessing their impact on efficiency, equity and financial protection in health care
www.cambridge.org [PDF]
… Participants pay healthcare expenses from their MSA up to the amount of the insurance … out-of-pocket costs for HSAs linked with HDHPs, lower income and less healthy households are … conditions could be financially burdened even more if they participated in HSA health plans …

Q&A About Health Savings Account (HSA)