Quick Definition

A Health Savings Account (HSA) is a tax-advantaged account designed to help individuals save for medical expenses that high-deductible health plans don't cover.

Examples

• 1An individual contributes $3,500 annually to their HSA and uses these funds to pay for prescription medications, dental treatments, and eyeglasses.
• 2A family uses HSA funds to cover the cost of childbirth and prenatal care, which are partially covered by their high-deductible health plan.
• 3An employee opts to invest a portion of their HSA funds in mutual funds to potentially increase their savings over time.
• 4During retirement, a person uses their accumulated HSA funds to pay for Medicare premiums and long-term care services.

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