Health Savings Accounts: What’s an Eligible Expense?

August 27, 2019

A Health Savings Account (HSA) is a tax-advantaged personal savings account that is used in conjunction with a High Deductible Health Plan (HDHP) to pay for eligible medical expenses as well as deductibles, co-insurance, prescriptions, vision expenses, dental care and over-the-counter health products. HSAs give employees the opportunity to set aside pre-tax dollars from their paycheck. In addition to using HSA funds to pay for current out-of-pocket expenses, account holders can keep the money in their account year over year, with no limit on their accumulated balance, earning interest until they need it in the future. 

Who’s Eligible for an HSA?

All eligible participants enrolled in a HDHP and their tax-eligible dependents may contribute to an HSA. Self-employed individuals filing as an LLC or S-Corp, or an owner with more than 2% investment in the company assets can contribute to a HSA on a post-tax basis only and are not eligible for the pre-tax HSA.

What's an Eligible Expense?

An eligible expense is any healthcare expense approved by the IRS for reimbursement through an HSA. Eligible expenses can be incurred by the employee, their spouse or their eligible dependents. Learn more here https://www.chard-snyder.com/benefits/health-savings-account-hsa/hsa-eligible-expenses/ and find a complete list of services and items that are HSA-eligible here https://hsastore.com/HSA-Eligibility-List.aspx

How Can I Educate My Clients or Employees About HSAs?

National HSA Day is coming on Tuesday, October 15! HSA Day was created to educate Americans about the benefits of HSAs to achieve financial wellness & to alleviate the burden of healthcare costs. Learn more and register for an informative podcast at https://www.hsaday.com.

Need resources to promote employee HSA engagement at Open Enrollment time? Email marketing@chard-snyder.com and we’ll provide you with helpful materials.