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Health Savings Accounts

This page will provide answers for most all of your questions. Should you need additional assistance, please call one of our live customer service representatives at 888-682-7316 during normal business hours.

  • What is an HSA?

    "HSA" stands for Health Savings Account. HSAs allow consumers to pay for qualified medical expenses with pre-tax dollars—meaning income-tax free—and save for retirement on a tax-deferred basis.

    An HSA is tax-favored savings account that is used in conjunction with a high-deductible HSA-eligible health insurance plan to make healthcare more affordable and to save for retirement.

    HSAs are similar to individual retirement accounts (IRAs), but even better:

    • Pre-tax money is deposited each year into an HSA and can be easily withdrawn at any time with no penalty or taxes to pay for qualified medical expenses. Withdrawals can also be made for non-medical purposes, but will be taxed as normal income and are subject to a 10 percent penalty if done prior to age 65.
    • Any HSA funds not used each year remain in the account, and earn interest tax-free to supplement medical expenses at any time in the future.
    • Like an IRA, the account belongs to you, not your employer. But unlike an IRA, your employer CAN contribute to your HSA.

    Why should I consider getting an HSA?

    You may save money in the short and long term by:

    • Deducting 100% of your HSA contributions from your taxable income
    • Having the money in your HSA accrue interest and/or gains on a tax-free basis
    • Paying no penalties or taxes when you use your HSA to pay for qualified medical expenses
    • Having a high-deductible HSA-eligible health insurance plan, which typically has a lower premium than a plan with a lower deductible
    Note: Some HSAs charge a small monthly maintenance fee.

    What is a Business HSA?

    A Business HSA is a way for employers to assist employees with healthcare costs at a level they can afford. Employees purchase their own health insurance plans and open Health Savings Accounts. Employers contribute pre-tax dollars which may be used to pay for qualified medical expenses or saved for the future.

    For Employers
    To create a Business HSA program, employers must open a Business HSA account with HealthTrust Financial and set their desired contribution levels for employees. Through our online portal, employers can easily add or remove future employees, adjust contribution levels, and make automatic contributions to their employees' Health Savings Accounts.

    For Employees
    To participate in a Business HSA program, employees must apply and be approved for coverage under an HSA-eligible health insurance plan. They must also open a Health Savings Account. The HealthTrust Financial Business HSA program provides employees with an online resource to shop for HSA-eligible insurance plans, establish their own Health Savings Accounts, and track contributions and expenses.

    How does a Business HSA Work?

    Business HSAs allow employers to help employees with healthcare expenses without sponsoring a group health insurance plan. To participate in the Business HSA, employees must apply and be approved for coverage under an HSA-eligible health insurance plan, and must open a Health Savings Account. Funds contributed to the employee's Health Savings Account may be used by the employee to pay for qualified healthcare expenses on a tax-free basis, or invested and saved for the future.

    The HealthTrust Financial Business HSA provides employers with an online enrollment center for their employees to shop for HSA-eligible insurance plans, establish their own Health Savings Accounts, and manage their own contributions and healthcare expenses.

    In addition, the HealthTrust Financial Business HSA gives employers a Business HSA Management Portal to add and remove future employees, adjust employer contribution levels, and even use automatic payroll integration with major vendors to simplify employer contributions.

    By creating a Business HSA with HealthTrust Financial, employers encourage their employees to purchase health insurance protection on their own while helping them with the high costs associated with healthcare today.

    How does an HSA Work?

    A Health Savings Account is a savings account designed to help consumers save and pay for their healthcare expenses on a tax-advantaged basis. Funds can be deposited by consumers into the account on a tax-free basis and may be withdrawn without tax consequences to pay for qualified medical expenses. Employers may also deposit money into an employee's Health Savings Account on a tax-free basis. Funds in the account may be invested and earnings will not be taxed, and unused money will roll over from year to year.

    Health Savings Accounts may only be used in conjunction with HSA-eligible health insurance plans. These health plans typically have lower monthly premiums and higher deductibles than other types of health insurance plans. Funds from the Health Savings Account may be used to pay for qualified healthcare expenses accruing toward the deductible. Once the deductible is met, coverage under the HSA-eligible health plan pays for covered expenses (subject to co-payments) for the remainder of the year.

    Health Savings Accounts, used in combination with HSA-eligible health insurance plans, give consumers control over how their healthcare dollars are spent, and provide a valuable means of saving and investing for healthcare needs and for retirement.

    How do I explain a Business HSA to my employees?

    Your employees may not understand the benefits of Business HSA or the differences between Business HSA and traditional group health insurance. Here are a few key point to communicate.

    • The Business HSA allows employees the freedom to apply for the health insurance plan that best suits their needs and budget.
    • Through employer contributions to an employee's Health Savings Account, a Business HSA empowers employees to manage their own healthcare dollars.
    • While an HSA-eligible health insurance plan will require the employee to fulfill an annual deductible before coverage kicks in, expenses paid toward the deductible may be paid out of the employee's Health Savings Account, and leftover funds may be saved and grow from year to year. In case of a serious injury or accident, the HSA-eligible health plan will be there to cover medical bills beyond the deductible.
    • By participating in a BusinessHSA program, employees can find affordable HSA-eligible health insurance plans and have the option to save money for the future through a tax-advantaged savings account.

    What are qualified medical expenses?

    HSAs can be used to pay for many types of medical expenses, even some that are often excluded on health insurance plans. These include:

    • Health insurance plan deductibles, copayments, and coinsurance
    • Prescription and over-the-counter drugs
    • Dental services, including braces, bridges, and crowns
    • Vision care, including glasses and lasik eye surgery
    • Psychiatric and certain psychological treatments
    • Long-term care services
    • Medically-related transportation and lodging
    Typically HSAs cannot be used to pay health insurance premiums, although there are exceptions for:
    • Health insurance premiums if you are receiving federal or state unemployment benefits
    • Premiums for COBRA qualified health insurance
    • Certain qualified long-term care insurance premiums
    • Premiums for a health plan (other than a Medicare supplemental policy) for an individual age 65 or older
    Note: You must establish an HSA before incurring any expenses or the expenses will not qualify.

    What insurance plans are HSA Eligible?

    In order to have a Health Savings Account, you must get an HSA-eligible health insurance plan. This type of insurance plan is often referred to as a High Deductible Health Plan, and typically has lower premiums than plans with lower deductibles.

    A health insurance plan must meet the following criteria to be considered HSA-eligible:

    • The health insurance plan must have an annual deductible of at least $1,100 for individuals and at least $2,200 for families.
    • The sum of the annual deductible and the other annual out-of-pocket expenses required to be paid under the plan (other than premiums) does not exceed $5,500 for individuals and $11,000 for families.
    To make things easy for you, our site identifies the HSA-eligible plans with the symbol shown below:

    NOTE: If you have other health insurance coverage (such as coverage under a spouse's employer-sponsored plan) in addition to your HSA-eligible health insurance plan, then the other plan must 1) also be HSA-eligible in order to contribute to an HSA or 2) the other plan cannot cover any benefits provided under your HSA-eligible plan.

    How much can I contribute to my HSA?

    Maximum yearly contributions (and associated tax deduction) are determined as follows:

    For individuals, it is $3,000, and for families it is $5,9500.

    You do not have to contribute the maximum each year, although some HSAs require a small minimum monthly contribution.

    Note: If you are between the ages of 55 and 65, you can make an additional annual "catch up" contribution (of up to $1000 in 2008.)

    Can I roll over funds from other accounts into my HSA?

    You can make a one-time distribution from an IRA to fund your HSA, provided it doesn't exceed HSA contribution limits. Employees have the opportunity for a one-time, tax-free transfer of funds from their flexible spending account (FSA) or health reimbursement arrangement (HSA) to their HSA.

    Is My Money Safe?

    Funds in an HSA are held in a trust and are administered by a bank, insurance company, or other approved Trustee. This institution is often referred to as your HSA Administrator.

    Funds in your HSA are invested at your discretion. Typically an HSA will allow you to choose from one or more of the following investment options:

    • Interest-bearing account
    • CDs
    • Money market funds
    • Mutual Funds
    If you are looking to minimize your investment risk, you may want to consider an interest-bearing account; these accounts are FDIC insured. On the other end of the spectrum, mutual funds may provide a greater return, but are more risky, and are not FDIC insured.

    How do I use the funds in my HSA?

    Using funds in your Health Savings Account is easy:

    • Typically an HSA will provide you with a checkbook or debit card. When you pay for a qualified medical expenses, use the debit card or check to make the payment.
    • You do not need to get approval from the HSA administrator when you use funds in your account.
    • You do not need to submit receipts to the HSA administrator, although you should save them just as you keep receipts for other items that are deducted from your taxes.
    NOTE: You must establish the HSA before you incur medical expenses otherwise the expenses will not qualify.

    What are my investment options?

    Depending on which institution is the HSA Administrator for your Health Savings Account, you will be able to choose from one or more of the following investment options:

    • Interest-bearing account
    • CDs
    • Money market funds
    • Mutual funds
    Because the range of your investment options is determined by the HSA Administrator you select, you should evaluate your options before setting up you account. Our site makes it easy to do this by presenting you with a link which allows you to view all your HSA Administrator options for each health insurance plan you are considering. Simply click the "HSA Options" link (illustrated below).



    Once you find an insurance plan that meets your needs and has suitable HSA Administrator options, simply click the "APPLY" button to start the online health insurance application process. After completing the health insurance application, you will be able to select your HSA Administrator.

    How do the tax savings work?

    HSAs make it easy to save on your taxes:

    • At the end of each year, you will be sent a statement showing the amount you contributed to your HSA that year. You can deduct this amount provided it is less than or equal to the maximum allowable contribution.
    • Much like an IRA, HSA deductions are "above-the-line" and thus can be taken even if you do not itemize.
    • If you are self-employed, in addition to deducting your HSA contributions, you may be able to deduct 100% of your health insurance premiums, provided that:
    - You are not eligible to participate in a subsidized health plan offered by an employer or your spouse's employer.
    - The deduction does NOT exceed the amount of net income from your business.
    Note: Check with your accountant or tax advisor for the specific federal and state tax benefits that apply to you.

    Are there fees associated with HSA's?

    Depending on which institution is the HSA Administrator for your Health Savings Account, you may be subject to different fees, including: initial setup fee, monthly maintenance fee, and check fees.

    Because the type and amount of the fees differs between HSA Administrators, you should evaluate your options before setting up your account. Our site makes it easy to do this by presenting you with a link which allows you to view all your HSA Administrator options for each health insurance plan you are considering. Simply click the "HSA Options" link (illustrated below).

    Once you find an insurance plan that meets your needs and has suitable HSA Administrator options, simply click the "APPLY" button to start the online health insurance application process. After completing the health insurance application, you will be able to select your HSA Administrator.

    Why should I get my HSA through HealthTrust Financial?

    Here are just a few reasons to obtain your HSA through HealthTrust Financial:

    • We offer a broad selection of insurance plans, which makes it easy for you find an HSA-eligible health insurance plan that fits your particular needs.
    • We clearly identify the HSA-eligible health insurance plans so that you won't select an insurance plan which is not eligible.
    Health Savings Accounts (HSAs) are available to any person in the U.S. under the age of 65 who has an HSA-eligible health insurance plan.

    So, to get an HSA, you need to do the following:

    IT'S EASY!

    1. Use our site to shop for an HSA-eligible health insurance plan. These plans are identified as follows:

    2. Start the online health insurance application process by clicking the "Apply" button for the insurance plan you select.

    3. After completing the health insurance application process, select your HSA Administrator.

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