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Health Insurance Guide > What is an HSA and how does it work?What is an HSA and how does it work?HSA and HSA-eligible plans are getting increasingly popular. Here is the lowdown on how they work:An HSA is a tax-favored savings account that may be with an HSA-eligible high deductible health insurance plan to pay for medical costs that qualify. Opting for an HSA-eligible health insurance plan can help you save money. Normally, the monthly premium on an HSA-eligible high deductible plan is less costly than the monthly premium for a lower-deductible health insurance plan. With specific yearly limits, you can make contributions to an HSA pre-tax. Funds in the HSA may be deposited at the holder's discretion. Funds that are unused stay in the account and gain tax-less interest from year to year. Not all high-deductible plans are available for use with an HSA. |
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