One way to manage your health care expenses is by enrolling in a High Deductible Health Plan (HDHP) in combination with opening a Health Savings Account. A Health Savings Account, or HSA, is a unique, tax-advantaged account that can be used to pay for current or future healthcare expenses. When combined with a HDHP, it offers savings and tax advantages that a traditional health plan can't duplicate. With an HSA, insurers will have:
- A tax-advantaged savings account they can use to pay for eligible medical expenses including deductibles, co-insurances, prescriptions, vision expenses, and dental care.
- Access to unused funds which will roll over year to year. There's no "use it or lose it" penalty.
- Additional retirement savings. After age 65, funds can be withdrawn for any purpose without penalty, but may be subject to income tax if not used for IRS-qualified medical expenses.
- Flexibility to use your HSA to pay for the qualified medical expenses of anyone you claim on your taxes, even if you're only enrolled with single coverage. This is a great way to plan for unexpected medical expenses for the entire family.
A Health Savings Account can be utilized in both individual and group insurance markets when paired with a High Deductible Health Plan. See below guidelines:
Contribution and Out-of-Pocket Limits for HSAs and HDHPs
| HSA Contribution Limit |
(Employer + Employee)
| Self-Only: $3,550 |
| Self-Only: $3,500 |
| Self-only: + $50 |
Family: + $100
| HSA Catch-Up Contributions |
Age 55 or Older
|HDHP Minimum Deductibles|| Self-Only: $1,400 |
| Self-Only: $1,350 |
| Self-Only: + $50 |
Family: + $100
| HDHP Maximum Out-of-Pocket Amounts |
(Deductibles, co-payments, and other amounts, but not premiums.)
| Self-Only: $6,900 |
| Self-Only: $6,750 |
| Self-Only: + $150 |
Family: + $300