Professionally dressed benefits broker in a suit and tie sits in an industrial office looking at two clients and discussing how to present Health Savings Accounts.

Broker advising clients on HSAs

Lauren Hargrave - Headshot

A couple of older Americans at their kitchen table looking over retirement planning documents on a laptop and thinking about how their HSA fits in.

retirement planning with hsa

Diverse group of three women and two men dressed professionally at a conference table in a commercial bank happily discussing HSA partnership options

Financial institutions hsa partnership

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integrity and innovation 

Adam Berry

earn-for-retirement

Two men in business attire shake hands, one congratulating the other, while a smiling woman looks on.

Benefits of HSA employer matching

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financial advisors and hsas

Jessica Pfisterer

Lively can simplify your understanding of a Section 125 Plan by reading our articles.

Section 125 Plan Articles

What HR leaders and benefits professionals should look for to find the right HSA provider for their company and employees.

What HR Leaders Should Look for in an HSA Provider 

Open Enrollment

Lively can simplify your understanding of open enrollment. Here is what you need to know about open enrollment, healthcare, benefits, retirement, and of course HSAs.

HSA Account Rules

Lively can simplify your understanding of HSA account rules. Here is what you need to know about HSA account rules, healthcare, benefits, and retirement.

HSA account rules

Lauren Hargrave is a writer from San Francisco who focuses on technology, finance and wellness. She follows comedians like most people follow bands and believes an outdoor sweat session can cure almost any bad mood. She’s also been writing her first novel for so long, her mom doesn’t ask about it anymore.

Lauren Hargrave

Lively can simplify your understanding of HDHP. Here is what you need to know about HDHP, healthcare, benefits, retirement, and of course HSAs.

HDHP

Employee Benefits

Lively can simplify your understanding of employee benefits. Here is what you need to know about employee benefits, healthcare, retirement, and of course HSAs.

Employee benefits

Adam Berry oversees Lively’s Financial Institution Partnerships channel and works with banks across the country to develop and implement HSA product solutions. Over the last 20 years, Adam has gained a significant amount of HSA experience working for national TPAs and creating HSA programs within brick-and-mortar regional banks. HSAs are a personal passion of Adam’s, and he specializes in bringing entities together to discuss transparent, unique, and innovative solutions that result in a better way to do business, increase revenue for Lively’s banking partners, and improve the lives of their mutual customers.

What financial institutions should look for in an HSA provider to ensure a productive, profitable relationship and gain and retain customers.

What Financial Institutions Should Look For in an HSA Partnership

Personal Finance

Lively can simplify your understanding of personal finance. Here is what you need to know about personal finance, healthcare, benefits, retirement, and of course HSAs.

Learn how your HSA can help you in retirement and other retirement tips in his collection of articles 

Retirement Articles

There are many benefits to matching your employee’s HSA contributions. Learn everything you need to know here.

Benefits of Employer HSA Contribution Matching

Lively can simplify your understanding of retirement planning. Here is what you need to know about retirement planning, healthcare, benefits, and of course HSAs.

Retirement Planning

Lively can simplify your understanding of benefits in these articles.

Benefits Articles

As Vice President, People at Lively, Jessica leads the recruiting, HR, people operations, and employee experience functions. She brings an innovative approach to people teams and company culture based on her experience leading people teams at fast-growing startups. Her expertise in total rewards, engagement, and leadership allows her to partner with senior leaders on strategic people initiatives to drive the business forward. Jessica was the first people operations hire at MuleSoft, where she built and managed the function during international hypergrowth. At Greenhouse, she again started and grew the people operations function, along with the employee experience function, during a period of sustained growth. Jessica is a Senior Certified Professional by the Society for Human Resource Management. She holds a JD from Georgetown University and is an inactive member of the California Bar Association. 

Lively can simplify your understanding of HSAs. Here is what you need to know about HSAs, healthcare, benefits, and retirement.

HSA Articles

The key information financial and investment advisors need to know about Health Savings Accounts (HSAs) and how they help their clients build their retirement savings.

What Financial and Investment Advisors Need to Know About HSAs

Health Savings Accounts

Open enrollment is here. Discover how benefits brokers should be talking about health savings accounts during open enrollment.

Best Ways Benefits Brokers Can Talk About HSAs During Open Enrollment

Lively can simplify your understanding of HSAs. Here is what you need to know about healthcare, benefits, retirement, and of course HSAs.

Retirement

Section 125 Plan

HDHP (High Deductible Health Plan)

Financial Institutions

Why the retirement gap exists and how HSAs are crucial to helping workers set themselves up for retirement, even if they have a 401(k) or IRA.

How Can an HSA Help Bridge the Retirement Gap?

HSA (Health Savings Account)

Benefits

Health Savings Accounts (HSAs) might have launched 20 years ago, but there is still ample confusion about how they work and the benefits they impart to both employers and employees. Benefits brokers can help clear up this confusion by providing effective communication and resources that say the right thing, in the right way, at the right time. 

In this post, we’ll give benefits brokers the tools to overcome the communication challenges inherent to a health insurance marketplace that is constantly changing. You’ll know how to talk about HSAs (hint: don’t refer to them by their acronym), how to talk to employers and the types of resources that can do a lot of the heavy lifting so that employees understand, enroll in, and adopt their benefits this open enrollment. Let’s get started.

## What are the communication challenges?

When it comes time for employees to choose health insurance, there are a lot of products to choose from, especially supplemental savings and spending accounts, which can be pre- or post-tax, depending on the type of the account. To add to the confusion, some of the products have similar acronyms (e.g. HSA, FSA and HRA), and employees can often mistake one for the other. 

So when benefits brokers are talking about [Health Savings Accounts](https://livelyme.com/guides/hsa-guide/) and other saving and spending accounts with their clients, one key point to make is to differentiate this type of account from others. You can also help ease open enrollment communications challenges by: 

- Highlighting the rules and benefits of the account in simple language
- Speak to the concerns employers have
- Provide resources that can be an ongoing source of truth for employers and employees alike

Providing ongoing resources helps to ensure trust of, and engagement in the benefit account.

## Reframe how you talk about Health Savings Accounts

To effectively communicate the value of an HSA, focus on the long term savings value of the account, the healthcare and tax savings associated with an HSA, and how an HSA can complement other flexible employee benefits.

###  Emphasize the long term savings 

__Instead of saying “it’s a more flexible FSA” or a “super-charged FSA,” describe an HSA like a “401(k) for healthcare.”__ 

When explaining what an HSA is, many benefits and HR professionals can refer to it as a “more flexible FSA” or a “super-charged FSA”. But likening it to an Flexible Spending Account is discounting some attributes of the HSA that make it so valuable to employees and employers alike. Instead of using the FSA as a way to explain what an HSA does, try using the 401(k) as your reference. 

The key difference between an FSA and an HSA is that HSAs are owned by the employee and the balance never expires. In addition, account holders are able to invest their HSA balance and those investments grow tax-free. Therefore, the long-term savings capabilities of the HSA and the ability to use it as a retirement account liken it to the way the 401(k) functions and contributes to the participant’s overall financial health. Referring to the HSA as a healthcare 401(k) is not only a more accurate depiction of how the account functions and the benefits it imparts, but it helps frame the account in users’ minds as a long-term savings vehicle.

### Highlight healthcare savings and zero cost preventative care

__Emphasize that High Deductible Health Plans cover 100% of preventative care, pre-deductible, and highlight key aspects of coverage, such as wellness checkups, vaccines, and prescriptions for chronic conditions. 
__

Another aspect to the HSA that could benefit from a reframing is the [High Deductible Health Plan (HDHP)](https://livelyme.com/guides/hdhp/). Since enrollment in this type of health insurance plan is necessary in order to participate in the HSA, it can present a hurdle for employees because the amount of the deductible can make them nervous. 

When talking about the HDHP combined with the HSA, highlight that a [long list of preventative care](https://www.irs.gov/newsroom/irs-expands-list-of-preventive-care-for-hsa-participants-to-include-certain-care-for-chronic-conditions) is covered at 100% prior to the deductible being met. That means well visits, prescriptions for chronic conditions, vaccines, insulin, and more are covered with no out-of-pocket requirements under an HDHP. So employees can save their contributions for larger, big-ticket health expenses and save money on their monthly premiums at the same time.

### Demonstrate the tax savings

__Show how HSAs reduce employees’ and employers’ tax burden and adds money to employees’ pockets. __

HSAs help both employees and employers save on taxes. When an employer offers an HSA and employees make pre-tax contributions, that lowers employees’ taxable income and the employers’ FICA tax burden. In addition, when employers offer an [employee match](https://livelyme.com/blog/benefits-of-hsa-employer-matching/), they can write off the matching funds as a business expense. To show employers how much they can save when they offer their employees an HSA and employer match, use our [payroll tax savings calculator](https://livelyme.com/payroll-tax-savings/).

For employees, illustrate how they can add money to their pocket by reducing their tax burden when they contribute to an HSA and save on taxes with tax-free distributions now and in the future for qualified medical expenses. Use our [HSA savings calculator](https://livelyme.com/hsa-savings-calculator/) to  highlight just how much participants can save and the compounding effect of contributions made and saved over time, especially if participants invest their HSA balance.

### Showcase how HSAs are part of a modern, flexible benefits package

__Discuss how HSAs are compatible with other types of health and wellness accounts to drive more savings and engagement.__ 

HSAs also complement a host of other benefit accounts like [Lifestyle Spending Accounts (LSAs)](https://livelyme.com/guides/lsa-guide/), [Medical Travel Accounts (MTAs)](https://livelyme.com/guides/mta-guide/), and [Limited Purpose and Dependent Care Flexible Spending Accounts (FSAs)](https://livelyme.com/guides/flexible-spending-account-fsa/) to give employees a contemporary, competitive and flexible benefits package. All of these benefits give employees the purchasing power to spend their benefits money on the expenses that will have the greatest positive impact on their lives. The greater the positive impact, the healthier, more productive and more loyal these employees are likely to be.

## Follow these best practices to communicate the value of HSAs

Now that we’ve talked about the “right thing” you should say, we’re going to address the “right way” and “right time” to say it.

### 1. Avoid use of jargon

Nothing turns an employee's eyes from focused to glazed faster than the use of words they don’t understand. But jargon isn’t just exclusive, it’s ineffective and it often fails to encapsulate exactly what something is or does. So when talking about HSAs, it’s better to use simple language to answer the “what” and the “how” questions about this account.

That means using the full benefit name: Health Savings Account either as much or more than you use the acronym. It also means instead of saying, “triple tax advantage” to refer to HSAs tax-favored status, explain the tax-related benefits in terms of how they function. For example, you could say, “You won’t pay taxes on the money you contribute to your health savings account and use to pay for qualified medical expenses.”

By using simple language you can help employees see HSAs as less complex and more user friendly. They are also more likely to feel comfortable signing on for this type of benefit and confident in their decision to do so.

To help break down complex terminology, share our [Glossary of HSA and Health Insurance Terms](https://lively.foleon.com/resource/health-insurance-hsa-terms-glossary/) with your clients and their employees.

### 2. Know your clients’ motives

Before you can create your sales collateral aimed at employers, you have to know what they’re looking for this year. Their concerns are meeting employees’ benefit needs while still containing costs. Inflation, employee turnover, supply chain disruptions and more are putting pressure on HR teams to provide more with fewer resources. In fact, 45% of employers surveyed by Aflac stated that offering a competitive benefits package was the biggest challenge they faced this year, yet a recent Lively survey of HR leaders found that 84% of organizations have improved benefits in the past 12 months to attract and retain employees. 

In order to truly help employers achieve this goal, benefits brokers must help companies choose cost-effective benefits that will have a large impact on employees’ mental, physical and financial health. Benefits that are popular and benefits for which employees can realize positive effects immediately. HSAs fit this bill. 

- HSAs help companies save money. HDHPs typically have the lowest premiums of the health insurance plans and when paired with HSAs can help companies [save thousands of dollars in FICA taxes](https://livelyme.com/payroll-tax-savings/).
- HSAs help employees improve their financial, physical and mental health. They give employees a tax-free way to save and spend health care dollars and even save for retirement. This can lead to lower financial stress (thus improving their mental health), and better physical health because they both have a way to pay for the medical care they need, and are experiencing less stress so they’re less likely to have stress-related physical symptoms. This helps companies’ bottom lines because healthy employees are productive employees.
- [HSAs (especially HSAs that can be invested) are popular benefits](https://lively.foleon.com/resource/hsa-modern-benefits-package-sharing/) and offering them can help improve retention and recruitment efforts.  

### 3. Help employers understand the benefits of mitigating employee stress

To focus employers’ attention on how HSAs help to mitigate employee stress and the benefits of doing so, using data can be hugely effective. Here are some statistics around the state of employee stress levels, how they are affecting employees’ health and productivity, and of course, the companies’ bottom lines.

- [47%](https://lively.foleon.com/resource/employee-benefits-pulse-check-2023-sharing/) of HR leaders say that employee stress around financial standing has increased.
- [92%](https://www.apa.org/pubs/reports/work-in-america/2023-workplace-health-well-being) of surveyed workers said it’s important to work for a company that values their emotional and psychological well being.
- [53%](https://www.benefitnews.com/advisers/opinion/how-employee-financial-stress-increases-healthcare-costs) of employees say their financial stress interferes with their work.
- [83%](https://www.benefitnews.com/advisers/opinion/how-employee-financial-stress-increases-healthcare-costs) say financial benefits are critical to their financial security.
- [80%](https://lively.foleon.com/resource/employee-benefits-pulse-check-2023-sharing/) of HR leaders say that competitive financial benefits are more important than last year.

In addition, financial stress can lead to deteriorating physical health and decreased productivity. Unfortunately, people with financial stress tend to avoid getting healthcare which leads to worse health outcomes and higher healthcare costs and lower productivity, absenteeism and turnover. In fact, a workforce with more financially stressed employees will see more sick days. This unscheduled absenteeism costs these companies, on average, $3,600/year per employee for hourly workers and $2,650/year per employee for salaried workers. 

Conversely, employees that leverage financial benefits enjoyed a 4.5% reduction in healthcare costs. Companies that launched these initiatives experienced an ROI of between 100-300% on these programs.  

### 4. Provide resources and work with a provider that makes HSA education easy

One way to ensure that employers and employees alike remain happy with (and engage with) their benefits, is to provide resources during open enrollment that clearly explain the positive attributes of their benefits, as well as resources they can access at any time. 

Resources to provide during open enrollment can be brochures, a landing page for each benefit offering complete with an FAQ, and a digital tool that can help smooth out the open enrollment process. Other employee education services include town halls, AMAs and shorter communications via chat, text and email.

To provide ongoing resources, look for an HSA provider that offers easy-to-use tools and dashboards that enable employees to easily learn about and manage their HSA. This includes showing balances, total annual contributions made and how close they are to the annual contribution limit, and making it easy to change contribution amounts. Providers should also include resources like ongoing account holder education that explains how to use their accounts to fully realize their benefit.

### 5. Start small and set your clients and their employees up for success

For employees, the thought of building a large savings can be overwhelming to people, especially if they are starting with small contribution amounts. They might even feel as though “they’ll never get there” in terms of saving enough to pay for the  deductible. Here are some strategies that your clients can use to help get them comfortable with opening an account.

- Offer a [contribution calculator](https://livelyme.com/hsa-savings-calculator/) that shows the effects of compounding interest and investment of their contributions over time. This can give them a tangible picture of how small amounts saved add up over time.
- Encourage [employers to contribute money to employees’ accounts](https://livelyme.com/blog/benefits-of-hsa-employer-matching/). These contributions can be in the form of matching or a lump sum, but either way, employer-seeded accounts tend to perform better with employer contributions than those without. And not only do more employees adopt the HSA, they’re also more likely to contribute more money to their account if their employer also contributes.

## Ways Lively can help

Lively offers a [best-in-class HSA](https://livelyme.com/brokers/) that helps employers offer a popular benefits package that can improve their bottom line. Our UI is simple, clean and easy to use, HSA account holders can choose from different investing options, or they can choose to keep their contributions in savings. We offer a debit card, industry-leading customer service and account holder support all year long and we take care of all employee onboarding and communication. Our goal is to make HSA administration seamless with employers’ current systems and easy for everyone involved. We also offer transparent pricing to make it easier for companies to stay within their budgets and for employees to keep more of their money.

## Get started today!

Lively is your partner during open enrollment and beyond. If you’re looking to uplevel the benefits options you’re presenting to your clients, [reach out today](https://livelyme.com/contact-sales/). We’ll help you provide a greater service to your current clients and win new clients so everyone succeeds.  


How Benefits Brokers Can Effectively Discuss HSAs During Open Enrollment

There are many reasons to offer your employees benefits. The first being, it’s legally required in many cases. But beyond complying with state and federal employment law, offering employees benefits actually benefits employers if it’s done the right way. 

If employers offer employees benefits that are impactful and cost-effective, that solve real needs employees have, they can enjoy returns on that investment that include: a [healthier](https://www.pacificprime.com/blog/employee-medical-insurance-why.html) (and thus more productive) workforce, [increased employee loyalty](https://www.shrm.org/resourcesandtools/hr-topics/benefits/pages/benefits_loyalty.aspx), [higher talent retention and improved recruitment efforts](https://www.uschamber.com/health-care/new-survey-shows-health-benefits-rank-most-important-to-employees). And if they offer a particularly popular benefit: the [Health Savings Account (HSA)](https://livelyme.com/guides/hsa-guide/), they can also enjoy the cost containment regarding their health insurance spend.

But it’s not enough to just offer popular benefits. Employers need employees to adopt and engage with these benefits in order to experience the positive changes we noted above. One way to encourage employees to adopt and contribute to (i.e. engage with) an HSA, is for employers to match employees’ contributions.

## What is employer matching?

Employer matching means that an employer develops a formula that it will use to determine how much it will contribute to employees’ accounts based on said employees’ contributions. Employers could choose to match employees’ HSA contributions dollar-for-dollar, dollar-for-dollar up to a certain amount, or a percentage of employee’s contributions up to a certain amount. 

All Health Savings Accounts are subject to [contribution limits](https://livelyme.com/blog/hsa-contribution-limits/), which are set each year by the IRS for individual and family accounts, so total contributions (employee plus employer) cannot exceed that annual limit. 

## How does it work? 

If you’ve decided you want to match employees’ contributions to their HSAs, you must first determine how you want to do that (i.e. as part of a Section 125 plan or cafeteria plan or outside of a cafeteria plan). Then, determine your formula. 

The pros of using a cafeteria plan to contribute include:
- Employees can make their contributions via a pretax payroll deduction. This will reduce your FICA tax burden.
- Contributions are not subject to comparability rules. These rules state that all employer contributions must be either the same dollar amount or the same percentage of the High Deductible Health Plan (HDHP) deductible. If employers fail this comparability test, then they could be subject to a [35% excise tax](http://www.vision-hr.com/news/can-match-employees-pretax-hsa-contributions/). They are subject to [nondiscrimination rules](https://www.coredocuments.com/employee-classification-groups-nondiscrimination-rules/), however.

If you are using a cafeteria plan to contribute to employees’ HSAs you must:
- Set up a cafeteria plan if you don’t already have one in place. Your cafeteria plan must allow employees to make pre tax salary reduction contributions to their HSA.
- Your matching formula must be crafted to comply with [IRS nondiscrimination rules](https://www.coredocuments.com/employee-classification-groups-nondiscrimination-rules/).

Once you’ve decided how you’re going to contribute to employees’ HSAs, determine either: the flat amount you’ll contribute (if you’re contributing outside of a Section 125 plan), or the matching formula that you feel will adequately benefit employees and incentivize them to contribute to their HSA, and fits within your budget (if you’re using a Section 125 plan). You can also choose to contribute a flat amount to all employees’ accounts via a cafeteria plan.

Then you must use this same formula for all employees who are eligible to contribute to their HSA. Just make sure your match doesn’t exceed [IRS contribution limits](https://livelyme.com/blog/hsa-contribution-limits/) for the applicable year. Then, at the start of your plan year, as each employee contributes, you match their contributions accordingly. For guidance in calculating an employee match, use our [savings calculator](https://livelyme.com/payroll-tax-savings/).

## How does it benefit employees?

An employer match of employee HSA contributions supports employees financially, physically and emotionally. An employer match supports employees financially because the employer is contributing “free money” to an employee’s account to help them pay for out-of-pocket qualified medical expenses. And since any unused funds roll over from year-to-year, the employer is also helping employees save for a medical rainy day and even retirement. Employer contributions are tax-free to employees.

Employer matching benefits employees physically because their contributions help ensure employees have the money to pay for medical treatment when they need it. This can help [ensure employees get timely treatment](https://www.urban.org/sites/default/files/publication/49116/2000178-How-are-Income-and-Wealth-Linked-to-Health-and-Longevity.pdf) (which keeps them healthier) and can afford the prescriptions and other health supports they need.

Employer matching benefits employees emotionally because it can help reduce the [financial stress](https://graystone.morganstanley.com/the-parks-group/articles/graystone/thought-leadership/financially-stressed-employees) many feel when facing rising medical costs, chronic health issues and more. 

## How does it benefit my business?

There are many ways contributing to employees’ HSAs can benefit your business. In this section we’ll explore how making even small contributions to their accounts can reduce your business’s overall tax liability, help contain your health insurance spend, boost employee productivity, increase their loyalty, and help improve recruitment and retention efforts.

### Tax advantages

There are two ways employer matching of employees’ HSA contributions can reduce their overall tax burden. First, every dollar employers contribute to employees’ HSAs can be written off as a business expense. Second, and this the big one, every dollar employees contribute to their HSA reduces the employer’s FICA tax liability. By matching employee’s contributions, employers can incentivize employees to contribute more than they normally would, thus reducing their tax burden further.

To calculate how much you can save in FICA taxes when you contribute to your employees’ HSAs, use Lively’s [Payroll Tax Savings calculator](https://livelyme.com/payroll-tax-savings/).

### Contain your health insurance spend

Employees can only contribute to an HSA if they are [actively enrolled in an HDHP](https://livelyme.com/guides/hdhp/) and it’s their only health coverage. And since HDHPs are typically the most affordable of the health insurance plans from a premiums perspective, the more employees that are enrolled in the company’s HDHP, the lower its premium obligation is. But the high deductible can make employees nervous to take this health insurance option. 

However, by offering employer contributions to employees’ HSA accounts alongside the HDHP plan, employers can incentivize employees to take this more affordable health insurance option because they have financial support toward that higher deductible.

### Boost employees’ productivity

By financially supporting employees’ out-of-pocket costs, and by incentivizing employees to save more of their own money in their HSAs, employers can help to ensure employees have the money to pay for medical care when they need it. Employees that have the money to pay for care when they need it are more likely to get timely care, which means they are likely physically healthier and experience lower financial stress than employees that don’t have the means to pay for the care they need. Healthier employees (both from a physical and mental standpoint) are more productive employees.

### Improve employee loyalty and retention

According to experts, employees feel [more loyalty](https://hiring.monster.com/resources/workforce-management/employee-performance/why-loyalty-matters/#:~:text=The%20Truth%20About%20Employee%20Loyalty&text=According%20to%20experts%20in%20the,company%20is%20loyal%20to%20them.) toward their employers if they feel like their employers value and are loyal to them. Employees want to feel cared about. They want to stay where they are supported. They want to stay where it makes financial sense to do so. 

By matching employee HSA contributions, employers show they value their employees, they financially support employees’ physical and mental health, and they provide a financial benefit that can be more affordable than a simple salary increase but still contributes to employees’ household bottom lines.

### Attract top talent

HSAs are among the fastest growing benefits in [popularity](https://www.devenir.com/wp-content/uploads/2022-Year-End-Devenir-HSA-Research-Report-Executive-Summary.pdf). With all the attributes this type of account has, from saving for future medical needs (and even retirement) to the ability to invest your contributions, HSAs are a highly desirable benefit for incoming talent. In fact, in a survey of HR, Lively found that [79% say that HSAs are effective in attracting and retaining top talent](https://lively.foleon.com/resource/hsa-modern-benefits-package-sharing/). By offering employer matching, companies can show that they not only support the employees by giving them the benefits they want, but they will financially support them as well.

## Get started today!

If you’re looking to uplevel your benefits offerings, including offering a best-in-class HSA that makes employer matching and administration easy, [reach out today](https://livelyme.com/contact-sales/). Lively is your partner in providing your employees with the most supportive package that also fits within your budget. We make plan administration easy and effective, and we make HSA management streamlined and intuitive for account holders. We’re here to support employers and employees alike in building a better company and financial future.

Ways Health Savings Account Matching Benefits Employers

As a financial or investment advisor, your job is to help your clients create the best financial future for themselves and maximize their savings and investments. You can guide them towards lucrative investment vehicles, advise them on where to cut expenses, and help them achieve their long term financial goals. In all the mix of your clients’ assets, one account that shouldn’t be ignored is their Health Savings Account (HSA). 

The tax advantages of an HSA, especially in retirement, make it one of the most critical savings and investment accounts a person can maintain. It can also be an account likely to be forgotten if your client changes employers or ceases to be covered by a High Deductible Health Plan (HDHP). In this post we’ll walk you through the key information financial and investment advisors need to know about HSAs and how they can use these accounts to help their clients plan and build their savings for [comfortable retirement](https://livelyme.com/blog/hsa-bridge-the-retirement-savings-gap/).

## What is an HSA?

An [HSA](https://livelyme.com/guides/hsa-guide/) is an account into which participants contribute tax-free money to pay for qualified medical expenses. Not all providers offer the full range of HSA features or enable account holders to maximize their savings. Some function strictly as savings accounts and earn minimal interest on deposits, while others allow the investment of contributions. Here are the basic attributes of the HSA that make it a financially advantageous account for clients to maintain:

- The account has a triple tax advantage. The money clients contribute is tax-free up to the [annual contribution limit](https://livelyme.com/blog/hsa-contribution-limits/), which is set each year by the IRS. When account holders contribute to their HSA with pre-tax contributions, it also lowers their taxable income. HSA account balances grow tax-free, and the money that is used to pay for qualified medical expenses is distributed tax-free as well, regardless of your age at the time of distribution. That means your clients can save up to 37% on medical expenses, depending on their tax bracket. For example, would you rather your client paid $1,000 for an MRI, or $630?
- Account balances roll over from year to year, building a balance at an average net growth of 25%. This allows your clients to use their HSA to augment their other savings strategies with one that can be used to pay for a medical expense, even in retirement. 
- HSAs begin to function like a [retirement account](https://livelyme.com/blog/hsas-for-retirement/) once the account holder reaches age 65 with one exception: qualified medical expenses remain tax-free. This is especially helpful, because an individual can expect to pay [over $150,000 on health-related expenses in retirement](https://livelyme.com/blog/retiring-how-much-you-will-actually-need-healthcare/) after what’s covered by Medicare. All other distributions from an HSA are taxed at the appropriate income tax rate, which, depending on their retirement income, could come out at a lower tax bracket than when they made the contribution. 
- Your clients own these accounts and can never lose access to their savings, regardless of whether or not they are still working with the sponsoring employer or covered by an [HDHP](https://livelyme.com/guides/hdhp/). It’s true that in order to contribute to an HSA, the account holder must be actively enrolled in an HDHP and that can be their only health insurance coverage. But if they decide to buy different coverage later, they can still use their funds to pay for qualified medical expenses, or resume contributions if they ever elect an HDHP again in the future. As long as they have a balance, those funds can be invested and working for them generating supplemental income for retirement regardless of their health coverage status.
- They can [invest their contributions](https://livelyme.com/features/invest-your-lively-hsa/), ideally growing similar to investments in a 401(k) or IRA. Not all HSA administrators allow contribution investment, and some enforce high minimums that must be achieved before investment is allowed. But, if your client has an HSA like Lively’s, with low or no minimums required, they can invest as much of their money as possible so they can build their medical nest egg faster.
- Clients can use these accounts to pay for expenses for themselves, their spouses and their tax dependents, regardless of whether they are also covered under the same HDHP as your client.

## How HSAs are an essential part of a wealth building strategy

The way HSAs function allows clients to take advantage of favorable tax rules to augment their retirement savings with an account that helps them save money on medical expenses while they build their nest egg for the future. Here’s how HSAs help clients build true wealth:

1. HSAs help clients save money now and later. Since contributions are tax-free, they can help lower clients' income tax burden now while also saving them money on the medical expenses they pay for using their contributions. Clients also save money by buying HDHP insurance coverage since the premiums for these types of plans tend to be less expensive than traditional copay plans. In addition, clients can use their HSA money to pay for medical expenses in retirement tax-free. The average couple retiring today is expected to pay an average of $315,000 in [medical expenses in retirement](https://livelyme.com/blog/retiring-how-much-you-will-actually-need-healthcare/).  The ability  to pay those tax-free is significant
2. HSAs can augment other retirement accounts when contributions are maxed out. All tax-advantaged accounts have an [IRS-imposed annual contribution limit](https://livelyme.com/blog/401k-ira-irs-retirement-contribution-limits/), so if your clients are bumping up against those ceilings and are looking for another savings vehicle (that also has tax advantages), an HSA can be a valuable option.
3. The rollover and triple-tax advantages allow clients to reap greater returns due to compound interest, especially if they can invest their contributions.
4. HSAs allow for efficient use of retirement funds. By having an HSA on hand to pay for qualified medical expenses tax-free (but doesn’t have to be used for that purpose once they reach age 65), gives clients both stability and flexibility. In addition, if clients choose to maximize their HSA contributions and pay for medical expenses out of pocket while saving their receipts, they can reimburse themselves at any point in the future, including in retirement. This enables them to invest the maximum of their HSA funds. Lively offers account holders a digital receipt storage feature, so need to worry about losing receipts. 

## Not all HSA providers offer equal benefits

When advising clients as to the right HSA to participate in, here are some of the things you should look for:

1. Fees. Just like with other retirement accounts like 401(k)s, high fees can significantly cut into clients’ savings and minimize the effect of compounding.  This hamstrings your clients’ ability to build the medical safety net they want and need. The types of fees you should be wary of are administrative or maintenance fees, investment fees, research fees, debit card fees, statement fees, and transaction fees. Not every HSA administrator charges these fees, so look for one with low to no added fees to ensure your clients are reaping the rewards of saving. Lively has no fees for individual account holders. 
2. Ability to invest. The HSA administrator should make investing their contributions simple to find, easy to understand, facilitate API funds flows, inexpensive rates, and have multiple investment options so your clients have the flexibility to choose the right investments for their personal situation.
3. Native mobile apps and online dashboards for easy account management. In order for your clients to get the most out of their HSA, they must be engaged with the account. HSA advisors that make account management easy, and dare we say, fun with clear dashboards and a mobile app, tend to have higher engagement numbers than advisors who don’t.
4. The ability for your clients to electronically roll over or transfer their HSA from a previous employer or advisor. We don’t have to tell you the benefits of having your money in one place. But HSAs are often the “[forgotten account](https://www.thinkadvisor.com/2023/02/10/the-account-people-forget-to-rollover/)” that’s left with a previous employer’s administrator while a new one is opened via a new employer. By having multiple accounts open, clients will be paying more fees for the same services, which will eat into their savings. In addition, they might not have the same investment opportunities with their old HSA administrator, or their accounts could be invested in some of the same funds, which is an inefficient use of their money. Encourage your clients to consolidate their HSAs into one place to take maximum advantage of high quality investments, low fees and the compounding effect of time plus investment growth. 
5. The ability for advisors to manage the investment assets of the account holders. If you typically manage your clients’ other investments, it could be more efficient for you (and beneficial for your clients) if you also managed the investments in their HSA. 
6. Knowledgeable, responsive customer support and tailored, easy-to-access HSA education so that clients get the most out of their accounts. Lively offers dedicated, top-rated customer service via email, phone, and live chat, as well as extensive resources so our customers get the support they need. 

As a financial or investment advisor, you should consider the [HSA a valuable tool to helping your clients achieve real wealth](https://livelyme.com/partners/). It helps them to save money today and in retirement, it provides a tax-efficient investment vehicle and allows them to augment the retirement savings accounts they’re already maxing out. For questions about how Lively’s HSA can help your clients improve their financial picture, [reach out today](https://livelyme.com/contact-sales/).


Americans are woefully financially underprepared for retirement. According to the National Retirement Risk Index, about [50%](https://www.forbes.com/sites/johnwasik/2023/07/10/coming-up-short-in-retirement-why-people-will-not-have-enough-money/?sh=77068c3c7da9) of working age Americans won’t be able to maintain their pre-retirement standard of living if their saving levels don’t increase. The gap between what those Americans have saved and what is estimated they will need is called the “retirement gap” and is estimated to be about [$7 trillion](https://www.bloomberg.com/opinion/articles/2022-03-28/the-u-s-retirement-crisis-is-a-financial-crisis-too?in_source=embedded-checkout-banner).

In this post, we’ll explore the reasons why the gap exists and how HSAs are crucial to helping workers set themselves up for retirement, even if they have a 401(k).

## What is the “retirement gap”?

The retirement gap is the difference between what it is estimated workers should have saved (based on their salaries and age) in order to maintain their pre-retirement lifestyle. Fidelity [recommends](https://www.fidelity.com/viewpoints/retirement/how-much-do-i-need-to-retire#:~:text=Key%20takeaways,hope%20to%20have%20in%20retirement.) that workers aim to save at least one year’s salary by the age of 30, 3 years’ salary by the age of 40, 6 years’ salary by the age of 50, 8 years’ salary by 60 and 10 years’ salary by 67. 

The amount of savings individual workers will need will depend on a wide variety of factors including, but not limited to, the lifestyle they want to lead, whether or not they own their home free-and-clear once they retire, and their healthcare needs. In fact, healthcare needs alone are expected to take up a big chunk of retirees’ savings. In fact, the average 65 year old couple retiring in 2023 can expect to pay an estimated [$315,000 in medical bills](https://www.businesswire.com/news/home/20230621969160/en/Fidelity%C2%AE-Releases-2023-Retiree-Health-Care-Cost-Estimate-For-the-First-Time-in-Nearly-a-Decade-Retirees-See-Relief-as-Estimate-Stays-Flat-Year-over-Year) over the course of their retirement. 

The recent National Retirement Risk Index found that 47% of all workers weren’t saving enough, and the households at greatest risk were those where the head of household was aged 30-39 years. The reasons are many, but most boil down to the recent economic climate, including the Great Recession and the Covid pandemic, and the fact that many people’s retirement strategy hinges on contributing to a 401(k). 

## Why 401(k)s shouldn’t be workers’ only savings vehicle

When most people hear the phrase, “retirement savings account,” they automatically think of a 401(k). That’s because the 401(k) has become the dominant retirement savings vehicle since the [1970’s](https://www.ebri.org/docs/default-source/fast-facts/ff-318-k-40year-5nov18.pdf) when the account type was created. It was [modeled after the pension](https://iconsavingsplan.com/blog/retirement-planning/why-we-need-an-alternative-to-the-401k/) and meant to provide workers that stayed at a company for a long time, a way to save for retirement. But here are some statistics on how the 401(k) is functioning in today’s work environment:

- In 2020, [40%](https://iconsavingsplan.com/blog/retirement-savings/why-dont-81-million-americans-have-a-retirement-plan/) of the workforce participated in a 401(k).
- In 2021, [68%](https://www.bls.gov/opub/ted/2021/68-percent-of-private-industry-workers-had-access-to-retirement-plans-in-2021.htm) of private industry workers had access to any retirement plan, only 51% chose to participate. 
- [$92 billion](https://iconsavingsplan.com/blog/retirement-planning/why-we-need-an-alternative-to-the-401k/) is cashed out of 401(k)s every year at job change.
- Approximately [58 million](https://www.mckinsey.com/featured-insights/sustainable-inclusive-growth/future-of-america/freelance-side-hustles-and-gigs-many-more-americans-have-become-independent-workers) Americans that are gig workers (38% of all workers) are locked out of participating in a 401(k).

The 401(k) is a great savings vehicle if the worker has access to one through their employer (especially if that employer matches contributions), and if that worker stays at their employer for many years. But once the worker leaves their employer, they lose the ability to contribute to their 401(k). Their options are:

1. They can roll their account into a new 401(k) if their new employer offers one, and their plan allows rollovers. There is sometimes a fee associated with this.
2. They can roll their account into an IRA.
3. They can cash out their balance (and pay a [hefty tax penalty](https://www.irs.gov/retirement-plans/hardships-early-withdrawals-and-loans)).
4. They can manage multiple retirement savings accounts from multiple employers. That means they’re paying fees on multiple accounts, and can be invested multiple times in the same funds.
5. They can abandon their account.

Right now, the average millennial and gen Z workers stay at a company for [2.75 years](https://www.gallup.com/workplace/231587/millennials-job-hopping-generation.aspx). In addition, 38% of all workers are considered 1099 employees and are thus ineligible to participate in a 401(k). That means a large percent of the working population needs a way to save for retirement (especially medical care in retirement) that is portable and flexible. That’s where an HSA comes in.

## Why an HSA is an essential part of every workers’ retirement savings strategy

A [Health Savings Account (HSA)](https://livelyme.com/guides/hsa-guide/) is a powerful savings tool that can be used in the present moment to pay for qualified medical expenses and to save for the future. Here are the HSA basics:

- Contributions made to HSAs receive a triple-tax advantage from the IRS. They are tax-free the year they’re made, they grow tax-free and when they’re used to pay for [qualified medical expenses](https://livelyme.com/whats-eligible/), those distributions are tax-free as well (even in retirement).
- The only requirements for contributing to an HSA are: participants are covered by a [High Deductible Health Plan (HDHP)](https://livelyme.com/guides/hdhp/), they are 18, they are not considered a dependent on someone else’s tax returns, and they are not enrolled in Medicare. That means 1099 workers are free to use this account to save.
- The HSA balance rolls over from year-to-year enabling account holders to build a medical safety net.
- Account holders own their accounts so they never lose access to their HSA, even when they leave their employer. They can also use their savings to pay for qualified medical expenses once they’re no longer covered by an HDHP. However, they must be covered by an HDHP, and that must be their only insurance coverage, in order to contribute to their account.
- Once participants reach age 65, the HSA converts to a traditional [retirement account](https://livelyme.com/blog/hsas-for-retirement/) in that savings can be used for everyday expenses. Qualified medical expenses remain tax-free and everything else is taxed at the appropriate income tax rate.
- [Contributions can be invested](https://livelyme.com/features/invest-your-lively-hsa/), allowing participants to grow their account balances at the rate of the market.

If workers have access to and are participating in another form of retirement savings account(s), an HSA can help augment those accounts by providing them a tax-free way to pay for medical expenses in retirement, as well as giving them another tax-advantaged savings vehicle if workers are bumping up against their [annual retirement contribution limit](https://livelyme.com/blog/401k-ira-irs-retirement-contribution-limits/). In addition, HSAs give workers that don’t have access to a 401(k) a way to save for retirement. 

An HSA can be a powerful savings tool and should be a part of every worker’s retirement savings strategy. If you have questions about how Lively can help you, your employees or your clients to save for retirement (as well as on qualified medical expenses), [reach out to us today](https://livelyme.com/).

How HSAs can Help Americans Bridge the $7 Trillion Retirement Savings Gap

HSAs are a great employee benefit. They also have some nice perks for employers, like helping them attract and retain top talent—all while reducing healthcare costs. The challenge for HR leaders and benefits professionals often lies in finding the right HSA provider. 

I’ve worked in the employee benefits space for a long time and love being Lively’s VP of People. That’s because we’re a benefits solutions provider that genuinely wants to make it easier for employers and individuals to manage their HSAs. It goes hand in hand with our mission of helping people embrace a healthy future. Here are a few important things to look for in an [HSA provider](https://livelyme.com/).

## A smooth rollout

Launching an [HSA program](https://livelyme.com/guides/hsa-guide/) can be a tall order. The right benefits solution provider is one that can help streamline the process. It’s probably wise to launch an HSA education campaign beforehand so that your [employees understand how it all works](https://livelyme.com/blog/employee-hsa-adoption/). That includes the advantages that HSAs bring to the table, as well as the logistics of signing up. It’s an important piece that’s often overlooked when new benefits are being implemented. 

Beyond that, you want an HSA provider that has a reliable, easy-to-use product. If not, your internal benefits team will likely be flooded with employee questions and concerns, which can eat into their time and focus. In a past role before [I came to Lively](https://livelyme.com/blog/meet-our-vp-of-people/), I had an experience where an HSA program was rolled out and then didn’t work properly. Employees had issues with everything from checking their balances to using their HSA cards. My team had to work overtime to [find a new HSA provider](https://livelyme.com/resources/employer-hsa-selection-guide/) that could meet our needs. 

## Tech solutions that make life easier

Technology is ever evolving, but not all HSA providers are keeping up. The industry has a reputation for antiquated tech and outdated systems. One of the reasons Lively was founded was to make HSAs, and benefits solutions, straightforward to access and use, and an important way to do this was to bring the technology that powers them into the 21st century. Our easy-to-use platform is all about keeping things simple. It’s a user-centered experience that includes paperless onboarding and a top-rated mobile app. In other words, it’s a modern way to manage your HSA.

The thing with employee benefits is that after [enrollment](https://livelyme.com/guides/open-enrollment/), you shouldn’t be hearing about them from your employees all that much. It means they’re going about their lives and using their benefits without any issues. But if your HSA provider has glitchy tech or a cumbersome platform, you can bet that it’s going to cause disruptions for your employees and for your People/HR team.

## Customer service you can count on

Your HSA provider shouldn’t leave you flying blind. Whether it’s an employee trying to get in touch to ask a question or the employer trying to troubleshoot an issue, connecting with your provider should be easy. Not only that—they should be ready and able to provide support. With regard to the not-so-great HSA rollout I experienced a while back, poor customer service was perhaps the biggest hurdle. Employees were coming to my team in droves complaining about their inability to get any real help from the HSA side. 

This was especially frustrating because we’d worked hard to educate folks about HSAs and get them enrolled. Now here they were struggling. If people have an issue, they should be able to get the answers they need, whether that’s through self-service on the platform or website or calling member support. It’s so important to have that good customer service, and that's something I'm really proud of here at Lively. All employers, no matter what size, have access to a dedicated Customer Support Team. We’re here to walk you through whatever you need. That includes everything from general questions to specific issues, big and small, for both the employers and account holders that work with us.

## Affordable pricing

Including an HSA in your employee benefits package shouldn’t break the bank. At Lively, you can expect clear, transparent pricing. That means no hidden fees or tricky cost structures. We charge a flat rate per employee, per month. Since Lively started, we’ve saved our account owners over $8 million in fees, which I’m really proud of. So, when comparing HSA providers, be on the lookout for unclear pricing or excessive or hidden fees. They’re probably red flags. 

If you’re booking to partner with a benefits solutions provider who’ll have your back, [reach out to Lively](https://livelyme.com/contact-sales/) today.


What to Look for in an HSA Provider—and Why You Should Switch

For financial institutions that are looking for new revenue streams or ways to reach new customers, and retain existing ones (both commercial and retail), offering a Health Savings Account (HSA) can be a crucial piece of your business strategy. HSAs, and their corresponding High Deductible Health Plans (HDHPs) are fast becoming the most popular way U.S. workers and employers alike can save on health insurance costs while simultaneously improving employees’ financial health. 

In fact, over [55% of private sector workers](https://www.valuepenguin.com/high-deductible-health-plan-study) are enrolled in an employer-sponsored HDHP. But only [24% also participated](https://www.kff.org/report-section/ehbs-2022-section-8-high-deductible-health-plans-with-savings-option/#:~:text=ENROLLMENT%20IN%20HDHP%2FHRAS%20AND%20HSA%2DQUALIFIED%20HDHPS&text=Enrollment%20in%20HDHP%2FSOs%20has,HSA%2Dqualified%20HDHPs%20in%202022.) in an HSA alongside their HDHP plan. This presents a big opportunity for banks to step in and offer an HSA product that will help current and potential clients save for healthcare expenses and even retirement. In fact, after age 65, HSA account holders can continue to withdraw money from their account tax-free for qualified healthcare expenses and on any other type of expenses at their current tax-rate. 

But not all HSA providers are the same and thus they won’t extend the same benefits to businesses and their employees, or the financial institutions that offer them. Offering an HSA product can take time and precious resources from other projects, so if financial institutions want their product to bring the most value to the bank, they’ll need a partner that can do much of the heavy lifting when it comes to plan administration, onboarding, customer service, and more. 

## What are your options when offering an HSA?

Whether you’re looking to offer an HSA product for the first time, or offer a better HSA product than you do currently, consider the best practices below to help guide you in selecting the right HSA partner.

When offering an HSA, financial institutions have four general options:  

1. __An in-house demand deposit account.__ Building and maintaining an in-house HSA takes a lot of time and resources (especially to do it right) and usually results in a non-competitive product that functions more like a checking account than a dynamic savings and investment account. It lacks the capabilities required to be competitive like claims integration, digital receipt storage, engaging education, employer platform functionality, and APIs for payroll and benefit administration integration. It further requires a dedicated team of customer service employees, compliance officers who can offer deep industry knowledge and guidance around federal HSA guidelines, and operational oversight on a daily basis, all of which adds to the overhead stripping away any potential for profit.
2. __Software Purchase.__ You can buy a ready-made HSA solution with existing technology platforms. However, they can be incredibly expensive and offer no opportunity to hold deposits, keep interchange, obtain customer data, or generate revenue. These platforms are not customized or branded to your institution and come with additional requirements to staff a team, including sales and customer service representatives, to manage these solutions internally, which adds to the overhead expense.  
3. __Selling your book of business.__ You can outsource your HSA product and in doing so, sell your book of business, along with its deposits and revenue potentials, to another financial institution that is offering a more modern HSA product and may also cross sell other financial products that you already offer.
4. __Partner with an HSA provider to offer a cobranded product with a personalized approach and a cohesive customer experience.__ You’re looking for a partner with a proven track record of existing banking relationships for reference, engaged account holders and employer groups, and a platform that both fully integrates with your current systems and can be branded to the bank. 

Of these options, a true partnership solution is the most advantageous. It will remove all of the overhead within the bank on the HSA product, from tax reporting to operations to compliance. In addition, it will not only provide marketing collateral and distribution assistance, but will help your internal commercial teams close HSA sales and drive net-new customers into the bank to build new relationships. 

A true partnership can, and should, offer an HSA product that allows you to retain all of the core deposits, interchange revenue, and fee revenue while having access to all customer data for relationship building and cross-sales. The best HSA partnerships should allow your institution to offer a competitive solution for market differentiation, customer acquisition, deposit growth, and revenue with minimal lift on the bank itself.

## Not all providers are created equal - how to find the right fit for your institution

For a successful HSA partnership that ensures you will maximize the benefit of offering an HSA, look for an HSA administrator that offers a partnership model. That means the financial institution serves as the custodian for the HSA accounts and enjoys the benefits of co-branded cards and web portal experience, while the HSA administrator handles plan administration, customer education, onboarding, customer service, compliance maintenance, sales and marketing support and more. 

In order to implement, sustain, and grow an HSA offering, financial institutions need to look for an HSA partner that exhibits these characteristics:

- Allow you to hold the deposits and keep the interchange, spread, and fee revenue.
- Easily integrate into your current systems infrastructure.
- Help you build a plan to achieve strategic goals and objectives each year, including clear and actionable reporting features and an easy-to-use dashboard for online account management.
- Include comprehensive customer support, onboarding, and extensive resources for internal staff as well as customers, including compliance help and communications when regulatory changes affect HSAs.
- Offer transparent pricing so that you understand the true cost of offering the product, both to the bank and the customer. Make sure to ask for the fee schedule. It should include the fees that will be charged, when they will be charged and ways to avoid being charged fees.
- Enable you to expand relationships with existing customers and provide enablement resources to help sell the HSA. 
- Offer advanced technology including analytics, AI, and machine learning to help you run reports, spot and react to trends, solve problems and develop new products.
- Have strong market intelligence and understand how your HSA competes against both local institutions and “big banks.”

For your customers, both commercial and retail, look for an HSA partner that offers: 

- An easy-to-use platform that helps users easily understand their account balance, saving, and spending. 
- At least one investment option (Lively has two that cater to different comfort levels with investing).
- Data integration with other business units including customers’ HR information systems, payroll, benefits administration, etc. 
- Account holder and client education to enable you to empower customers with the relevant information to effectively use their accounts to meet their unique financial goals.

## Lively HSA: A different kind of partnership

With a [Lively partnership](https://engage.livelyme.com/fi-contact-us), you are the custodian of your HSAs. You hold the deposits, collect fee income, and we take care of the rest. We handle risk mitigation and compliance support, plan administration including onboarding, customer support, account management, internal partner enablement and staff education.

We price our partnership solution so that financial institutions get the greatest ROI on their HSA. Our fee schedules are clear, transparent, and include no hidden fees.

[Our HSA](https://livelyme.com/partners/) is also a top-rated product that has been expressly designed with the user at the top of mind. It includes a mobile app, account holder and employer dashboards for easy account management, two different investment accounts as well as a savings account option, debit cards and unparalleled customer service for both employers and account holders. We also offer co-branded sales enablement materials and knowledgeable sales professionals to help you expand relationships and close deals.

HSAs are long-term, portable accounts that allow financial institutions to establish lifelong relationships with their customers. Given the rise in the cost of medical care year-over-year, as well as the retirement savings gap in the U.S., HSAs are not just another way to save money. They can be an integral piece to the financial wellness puzzle for current and potential customers, enabling them to save for healthcare costs today and in retirement. Offering an HSA product now, establishes your financial institution as an essential partner to them and the generations of savers that come after them. HSAs are the future of financial wellness, now is the time to get on board. 

If you'd like to discuss how a Lively partnership could benefit your business, [reach out today](https://engage.livelyme.com/fi-contact-us).


It’s that time of year again, when 80% of Americans spend less than an hour researching one of the most important decisions they’ll make this year: their health coverage.  Unfortunately, this often leaves many people under-insured or without the right coverage for their needs.  To prevent this from happening to you, we have a few tips that’ll help you make the right decisions for you and your family this [open enrollment season](https://livelyme.com/guides/open-enrollment/).

## What is open enrollment?

[Open enrollment](https://livelyme.com/guides/open-enrollment/), simply put, is [a period of time, usually two-to-six weeks](https://livelyme.com/blog/why-do-open-enrollment-periods-exist-for-health-insurance/), when people can enroll in health insurance and other benefits for the next year. It most often occurs in the fall, but some employers have specific open enrollment periods, so if you are not sure when your company's open enrollment takes place, it's always a good idea to ask. Outside of open enrollment, you often are not able to change your health insurance coverage without a "qualifying life event," such as having a baby, getting married, or losing other health coverage.

## Common mistakes

Because researching healthcare options can feel like a chore, during open enrollment, roughly 90% of Americans choose the health plan they had the previous year, despite any changes in health. This lack of research and [preparation for open enrollment](https://livelyme.com/blog/five-tips-to-prepare-for-open-enrollment/) can leave them under-insured. In addition, individuals often don't look into how their plans may have changed, even if it has the same name, and often neglect the full range of benefits their insurance plan and employer offers. 

## Six tips to help you determine your benefits package

These simple, actionable tips will help you select the best benefits for you and your family.

## Review your family’s recent health history

To make sure you’re buying the right coverage for your family’s needs, you need to know what those needs are. Take a look at what your family’s medical needs have been over the last two years. Assess:
- How did your current plan support you?  
- Where did it fall short?  
Then ask yourself if you or a family member has been recently diagnosed with a condition that will require ongoing treatment.  If so, you’ll want to take that treatment into account when choosing a plan.

## Assess recent or near-future life changes

Are you [getting married](https://livelyme.com/blog/tag/are-married-getting-married/)? [Pregnant, wanting to get pregnant, or adtopting a child](https://livelyme.com/blog/life-events-that-can-change-your-healthcare-costs/)? Are you planning to move away from your preferred doctor and want to make sure you have access to another health provider you like? To make the right decision for your health coverage, you’ll want to anticipate how these future changes will affect your healthcare needs.

## Check your current plan

Plan names can stay the same but the benefits included within them could change. So even if you keep the same plan as you had last year, it could end up costing you more or less depending on what changes your employer or the plan provider made. Possible changes to look for are:

- Coverage levels
- Pricing
- Types of products offered
- New providers for existing products
- New products from existing providers

## See if premiums and deductibles have changed

Sometimes companies change the amount to which they’ll contribute to their employees’ health plans. If your company has changed its contribution levels, this will likely affect the amount you pay in premiums and deductibles. It might also affect the attractiveness of HSAs and FSAs in order to help with those deductibles.

## Do your own research

Your company will likely put out official communication regarding your benefits options and reviewing its resources is a good place to start.  But it’s not a place to end.  Many companies provide resources to help consumers make the right choices when it comes to their benefits. By doing your own research, you’re more likely to get a neutral third party assessment of your plan options, and you might even find better benefits in the marketplace than your company is offering.

If you do find better plans that you think your company should consider, try sending them to your Human Resources (HR) Department. When HR knows what employees need, they can make better choices in terms of what benefits they offer in the future.

## Check your company’s wellness initiatives

Companies have realized that a healthier workforce is a more productive workforce. To incentivize healthy behavior, many have started programs that reward such behavior with increased benefits like a [greater HSA](https://livelyme.com/guides/hsa-guide/) or 401(k) contribution, lower premiums, or other perks like reimbursement for gym memberships. Check with your HR Department to see if you might qualify for any increased benefits.

Navigating the healthcare labyrinth can feel like a job in and of itself.  But if you follow our six tips, you’re more likely to make the right decisions for your family and could end up saving money over the course of the year.

## Learn more with Lively

Lively is a modern, health savings account (HSA) that helps you save for routine and unexpected healthcare expenses and plan for retirement. To learn more, check out our [resources on healthcare and financial wellness](https://livelyme.com/resources/), including our [open enrollment guide](https://livelyme.com/guides/open-enrollment/), or see if an HSA is a [fit for you](https://livelyme.com/features/).

Select the right healthcare insurance benefits for your family. Picture shows doctor doing a checkup on a child with his mother holding him.

child and mother at a family doctor visit 

80% of Americans spend less than an hour researching their health coverage. Follow these tips so you can make the right decisions for you and your family.

Open Enrollment Tips for Employees | Lively

Open Enrollment Tips for Employees

Familiar with the tax-saving benefits of a health savings account (HSA), and wondering how you can extend those benefits to your family? While an HSA is owned by one person, there is a way to tap into those HSA funds for the rest of your family. Discover how, and the differences between a family HSA and individual HSA.

## Your plan is dependent on your health care coverage

To be [eligible to contribute to an HSA](https://livelyme.com/hsa-guide#qualifying-for-an-hsa-account), you must enroll in an eligible [High-Deductible Health Plan](https://livelyme.com/blog/what-is-a-high-deductible-health-plan-hdhp/) (HDHP). The IRS sets annual minium deductibles for individual and family health care coverage, as well as annual out-of-pocket maximums, and usually update those annually based on inflation.

## What is a Family HSA?

![what-is-family-hsa](//images.ctfassets.net/6j8y907dne6i/2AyTsX5zWqJw75Sf8dPxjn/27b942e17c0757642c853d85db8abfe4/what-is-family-hsa.jpg)

While often referred to as a “Family HSA” account, there is actually no such thing. 

Each HSA is owned by one person. But family coverage under a qualifying HDHP allows you to use your HSA to pay for [qualifying medical expenses](https://livelyme.com/whats-eligible/) for yourself and your family. The type of health plan (individual or family) you’re enrolled in decides how much you can contribute to your HSA account in one calendar year. 

If you are enrolled in an individual qualifying high-deductible health plan, you will only be able to [contribute the individual maximum contribution](https://livelyme.com/blog/hsa-contribution-limits/) amount set annually by the IRS. If you and your family are covered by the same qualifying health plan, then your contribution limit is increased to the annual contribution limit set for families. One rule: To contribute the maximum family contribution limit, none of the family members can be claimed on another person’s [tax return](https://www.irs.gov/irb/2004-02_IRB). 

## Annual HSA Contribution Limits

![hsa annual contribution limit](//images.ctfassets.net/6j8y907dne6i/3mripn4V4Q51N7FfM26AEf/283c4bf5ded5d8aefbf448ea77e7b317/hsa_annual_contribution_limit.jpg)

If you are enrolled in an individual qualifying high-deductible health plan, you will only be able to [contribute the individual maximum contribution](https://livelyme.com/blog/hsa-contribution-limits/) amount set annually by the IRS. If you and your family are covered by the same qualifying health plan, then your contribution limit is increased to the [annual contribution limit set for families](https://livelyme.com/blog/hsa-contribution-limits/). 

One rule: To contribute the maximum family contribution limit, none of the family members can be claimed on another person’s [tax return](https://www.irs.gov/irb/2004-02_IRB). 

If enrolled in an HSA-eligible HDHP, and at least 55 years old—or will be 55 any time in the calendar year—you can make an extra $1,000 contribution. This is a [“Catch-Up” Contribution](https://livelyme.com/blog/what-is-an-hsa-catch-up-contribution/). 

## Real-life examples
### Individual health plan with HSA

During open enrollment, James chooses an HDHP because he wants to take advantage of his employer’s contributions to an HSA. James is not currently married and doesn’t have any dependents, so his health plan will cover only him.

As an individual, James can contribute up to the individual annual [HSA contribution limit](https://livelyme.com/blog/hsa-contribution-limits/) without a penalty.

### Family Health Plan with HSA
Fast forward a few years, and James is now married with two children. James is at a different company, but still has his HSA and an HDHP that covers him and his family.

James is now eligible to contribute the family limit to his HSA, and while the contribution limits often change annually, he knows he'll be able to contribute up the the annual family [HSA contribution limit](https://livelyme.com/blog/hsa-contribution-limits/) within one calendar year.

## Can I Have a Joint HSA With My Spouse?
![no-joint-hsa-with-spouse](//images.ctfassets.net/6j8y907dne6i/4JyBNCLJUiCy6ietwyTrGn/588c28e6b0352282f87b6d0c6643cfe9/no-joint-hsa-with-spouse.jpg)

*Short answer:* No. An HSA is owned by one person. 

Yet, there is a way for you and your spouse to have HSAs of your own. If you and your spouse are covered under the same HDHP, you can each open your own HSA and contribute separately. But, the amount you and your spouse contribute, combined, cannot exceed the contribution limit for a family plan. 

### Real-life examples:

#### Family HSA contribution limit with two accounts

Jack and Diane are married and covered under Jack’s high-deductible health plan. Diane wants to take advantage of her employer’s HSA contributions, so she decides to open up an HSA of her own. 

However, Jack and Diane’s total, combined contributions cannot exceed the family contribution limit set for the IRS that year. That means that whatever Jack contributes to his HSA and whatever Diane contributes to her HSA added together needs less or equal to the annual contribution limit. 

Jack and Diane can use these funds to pay for the [qualified medical expenses](https://livelyme.com/whats-eligible/) of those covered under their health plan, including each other.

#### Family HSA contribution limit with one account

The other option is to have the entire amount of the HSA in one account holder’s name. In this case, Jack opts not to contribute anything into his HSA for the year, and Diane and her employer will be able to contribute the entire amount into her account.

## The benefits of an HSA

![hsa-retirement-benefits](//images.ctfassets.net/6j8y907dne6i/1okT5ICuYiKx6c18Oof9dK/0e331b4135f6588ed8df49e0f2a24bdd/hsa-retirement-benefits.jpg)

There are four primary [benefits of having an HSA](https://livelyme.com/blog/what-are-the-benefits-of-an-health-savings-account/).

1. __Three levels of tax savings__. Pre-tax or tax-deductible contributions. Tax-free interest, and investment earnings. And tax-free withdrawals when used for qualifying medical expenses.
2. __Portability__. HSAs aren’t tied to your employer. If you decide to move to a different company or retire, your HSA stays yours. The funds added to your account stay there until you choose to withdraw or roll it over; like a 401(k).
3. __ A safety net in the event of a health-related emergency__. An HSA helps you save for the unknown. It can be used for unexpected health care expenses or health insurance if you’re between jobs. An HSA covers all qualified medical expenses, even after a change of plans or providers.
4. __ Flexibility in retirement__. When you turn 65, your HSA can be used for non-health-related expenses without penalties; like a 401(k), or IRA.

An HSA is a great safety net in the event of a health-related emergency. And with [options to invest](https://livelyme.com/blog/can-i-invest-my-hsa-money/), choosing to open an HSA is one of the best financial choices you can make for you and your family. 

To learn more, or to open an HSA, [get in touch](https://livelyme.com/features/) with us at Lively.


family hsa and individual hsa contributions are dependent on health care coverage

family-hsa-vs-individual-hsa

Learn the differences between a Family HSA vs Individual HSA. And how to extend HSA benefits to your entire family. 

Family HSA vs Individual: What’s the Difference?

What’s the Difference between a Family and an Individual Health Savings Account?

Dividing your assets, such as 401(k)s and Health Savings Accounts (HSAs) is a central piece of negotiating a divorce settlement. If you receive health insurance through your spouse’s employer, you want to carefully consider whether it makes sense to stay on your partner’s health insurance after you divorce.

## Tips for navigating health insurance when divorcing

### You can pay for health insurance through an ex’s health insurance.

If your health insurance was through your partner’s workplace plan, you may be able to stay on the plan for up to 36 months. The federal COBRA legislation requires any firm or organization with at least 20 employees to offer health insurance to the divorced partner. If your soon-to-be-ex works for a smaller employer, you may be eligible for extended COBRA coverage through a state-run plan.

But there’s a big expensive catch to COBRA health insurance coverage: Once you are divorced, the employer no longer will subsidize the premium cost for the non-employee. 

You will be required to pay the full cost. According to the Kaiser Family Foundation, the average monthly premium for single coverage through a group plan was nearly $7,200 in 2019.  And the employer is also allowed to tack on an additional 2% annual fee to cover administrative charges.

### Check out your employer’s health insurance. 

If you were on your partner’s plan because it was more robust or cost-effective than the plan offered by your employer, time to circle back to your workplace plan. It may now be more cost-effective than staying on your ex’s plan through COBRA. 

Getting divorced is considered a [qualifying life event](https://livelyme.com/life-events-that-can-change-your-healthcare-costs), so you’ll be able to enroll for health insurance outside of open enrollment. 

### Compare COBRA coverage to an ACA-marketplace plan.

Before you finalize your divorce, spend some time pricing out purchasing your own health insurance through the ACA marketplace. Depending on your income you may be eligible for subsidies. You can start your search at the [healthcare.gov](https://www.healthcare.gov/) website.

### Include the cost of paying for health insurance in your divorce negotiations. 

It’s likely that whatever health insurance solution you land on, the premium is going to be a sizable line-item cost in your monthly budget. You should factor that into negotiations for assets. And keep in mind that if there is a family HSA account that has a sizable balance, that is a valuable asset to also bring into your discussions. 

### Consider a legal separation as a temporary step. 

If you are legally separated, but not divorced, you may be able to stay on a spouse’s plan, but it varies by employer and insurer.

### Sort out who pays for insurance coverage of the kids.

This is obviously a key part of your divorce negotiation. If you opt for joint custody and you both assume responsibility for health insurance, the spouse whose birthday falls earlier in the calendar year will have the “primary” insurance for the children. If there isn’t joint custody, the custodial parent typically assumes responsibility for health insurance for children. If the custodial parent remarries, and doesn’t have health insurance, the responsibility can fall to the custodial parent’s new spouse. If that isn’t an option the non-custodial parent will be required to step in and provide health insurance coverage.

Given the complexity of divorce, including health insurance coverage. consulting with a lawyer experienced in divorce law is a smart move to ensure that everyone in the family is covered. 



stay-on-insurance-divorce

Divorce is a complicated process - and it doesn't help that your health insurance gets tied up into the process as well. We detail some information that you will need to know regarding your healthcare if you are getting divorced from your partner.

How Long Can I Stay on My Partner's Insurance After a Divorce? 

<p>Helping employees understand the benefits of an HSA (like any new HSA user), takes time and resources. In order to make the HSA education and engagement process easier for employers and employees, we have outlined our best practices.</p>
<p></p>
<p>Our employee HSA education guide will help you get HSA strategies&nbsp;in place from day 1 so employees can take advantage of the&nbsp;<a href="https://livelyme.com/what-are-the-benefits-of-an-health-savings-account/">triple-tax benefits</a>&nbsp;immediately.</p>
<h2>HSA Employee Education Tips</h2>
<p>Opening, establishing and contributing to an HSA should be easy.&nbsp;It shouldn&#8217;t be rocket science, that&#8217;s at least what we think at Lively! Here is what every employee needs to know to get started with their new HSA:</p>
<ol>
<li>Confirm&nbsp;<a href="https://livelyme.com/hsa-eligibility-details/">HSA-Eligibility</a></li>
<li>Understand&nbsp;<a href="https://livelyme.com/2018-hsa-contributions/">Contributions&nbsp;Limits</a></li>
<li><a href="https://livelyme.com/add-1-hsa-day-1/">Open and Establish their HSA</a></li>
<li>How to&nbsp;<a href="https://livelyme.com/hsa-rollovers-and-transfers/">Rollover or&nbsp;Transfer</a>&nbsp;an Existing HSA</li>
<li><a href="https://livelyme.com/set-forget-hsa/">Automating HSA Contributions</a></li>
<li>Use an HSA&nbsp;<a href="https://livelyme.com/hsa-debit-card/">Debit Card</a>&nbsp;for Eligible&nbsp;Purchases</li>
<li>Review&nbsp;<a href="https://livelyme.com/can-i-invest-my-hsa-money/">HSA Investment</a>&nbsp;Options</li>
</ol>
<p>No employer health or financial situation is the same. Once employees have opened&nbsp;an HSA, customizing&nbsp;HSA strategies can help each and every eligible employee take advantage of their HSA benefits. This will better ensure success (and renewal). Let&#8217;s look at two likely employee HSA scenarios:</p>
<ul>
<li><b>HSA Saver</b>&nbsp;&#8211; HSA savers are more focused on the long-term savings value of an HSA. They can invest their funds or simply take advantage of FDIC-Insured interest bearing&nbsp;HSA accounts. Thereby taking advantage of compound interest and save HSA funds for future health costs.</li>
<li><b>HSA Spender</b>&nbsp;&#8211; These employees are using pre-tax HSA funds to pay for expected and unexpected health costs. They can use their dedicated HSA funds to reduce their out-of-pocket health expense liability.</li>
</ul>
<p>Many HSA account holders are a mix of both. Helping employees save for health costs today and plan for anticipated health costs well into retirement will only increase HSA adoption.</p>
<h4>Employee Engagement and Support</h4>
<p>Things come up. Employees get stuck. We get it. We have&nbsp;been through it ourselves. Making sure on-demand support options are available for employees is crucial in this process. It saves everyone time. Employee HSA education is an ongoing process. So we created an on-demand resource center to help &#8211; from an&nbsp;<a href="http://support.livelyme.com/">HSA FAQs</a>&nbsp;to&nbsp;<a href="https://livelyme.com/calculator/">HSA saving calculators</a>. We backed it all up with a dedicated&nbsp;customer&nbsp;service team to answer employee&nbsp;questions via&nbsp;<a href="mailto:support@livelyme.com">email,</a>&nbsp;<a href="tel:1-888-576-4837">phone</a>&nbsp;or chat (via our website).</p>
<h4>Don&#8217;t&nbsp;Forget! Talk About Retirement &amp; Health Costs</h4>
<p>Many employees are stuck on a year-to-year&nbsp;ferris&nbsp;wheel when it comes to health insurance and cost planning. Employees are forced into rising yearly health insurance premiums and out-of-pocket costs. Not planning for health costs in retirement &#8211; which are&nbsp;<a href="https://www.cnbc.com/2017/11/24/health-care-costs-in-retirement-can-top-275000.html">expected to exceed&nbsp;$275,000 per couple</a>&nbsp;&#8211; can be a financial mistake. Employees can use their HSA to plan and save for retirement. In fact, an HSA might be the&nbsp;<a href="https://livelyme.com/stealth-ira/">new stealth IRA</a>.</p>
<p>Opening an HSA is easy (at least at Lively). Helping employees understand the value of an HSA should be too. Use this employee HSA guide&nbsp;to fast-track benefits education to save employees time.</p>

Employee-HSA-Guide.jpg

Helping employees understand the benefits of an HSA (like any new HSA users), takes time and resources. In order to make the HSA education and engagement process easier for employers and employees, we have outlined our best practices.

Employee HSA Guide

Lively Blog

What is an HSA?

How Do I Qualify for an HSA?

How Does a Health Savings Account Work?

How Much Can I Contribute to My HSA?

What Can I Use a Health Savings Account For?

It’s a fact. The cost to be - and stay - healthy rises each year. And even the comprehensive  (expensive) health insurance plans are covering less for the cost of care. So what’s a person to do? Open an HSA.

A Health Savings Account (HSA) allows you to set aside money on a pre-tax basis to pay for qualified medical expenses. You, your employer, and even friends and family can contribute money to your HSA. The contributions are tax-deductible and never expire. So you can save them for a rainy day, retirement, or to help pay for an expensive procedure you have coming up.

## How do I qualify for an HSA?

To qualify for opening and contributing to an HSA, you must meet these criteria:

1. You must enroll in a [High-Deductible Health Plan](https://livelyme.com/guides/hdhp/) (HDHP). 
2. You have no other health coverage except what is permitted under what the IRS defines as "[other health coverage](https://www.irs.gov/publications/p969#en_US_2022_publink1000204039)."
3. You must not be enrolled in Medicare.
4. You can’t contribute to a [Health Flexible Spending Account](https://livelyme.com/blog/what-is-a-healthcare-fsa/) (HFSA). But you can contribute to a [Dependent Care](https://livelyme.com/blog/dependent-care-fsa-dcfsa-work/) (DCFSA) or [Limited-Purpose FSA](https://livelyme.com/blog/what-is-a-limited-purpose-fsa/) (LPFSA) and contribute to a health savings account in the same year.
5. You can't be claimed as a dependent on someone else's tax return.

## How to enroll and use an HSA

![how-does-health-savings-account-work](//images.ctfassets.net/6j8y907dne6i/3zynuAFE9SoOfJRy8MT7lO/d0078bf16189f8141aeeaa5b7ae1da54/how-does-health-savings-account-work.jpg)

### Step 1: Elect a high-deductible health plan during open enrollment.

![Infographic High Deductible Health Plan plus HSA how you save](//images.contentful.com/6j8y907dne6i/5lcCeg9CA7pfdV9jfLrUVG/86661d1a0187b5c1f8408c52a5247e9f/Infographic_HealthPlan_plus_HSA_HORIZ.png)

### Step 2: Open a health savings account and decide how much you want to contribute. 

To enroll in an employer-sponsored health savings account, you'll likely open your HSA during open enrollment. Let your employer know how much you want to contribute for the year up to the [IRS contribution limit](https://livelyme.com/blog/hsa-contribution-limits/), which are different whether you are an individual, family, and/or over 55. Your employer may begin making payroll deductions each month.

Your employer may choose to contribute to your HSA. But they’re not required to. If they do, those contributions will count toward your annual limit. But will remain tax-free to you.

![Infographic how money goes into your HSA](//images.contentful.com/6j8y907dne6i/5qd6V0TtmmbBHgwTvMuTHh/f26f8ca95dd89fa960804adbe80616d6/Infographic_Money_In_HORIZ.png)

Maybe your employer doesn’t offer a health savings account. Or it’s outside of open enrollment and you want to get started on saving for your health care costs today. You can open an HSA with a financial institution in the private market.

With this route, you will make arrangements to fund your HSA with the account administrator. And your contributions will be deducted from your gross taxable income when you pay taxes for that year.

### Step 3: Use your funds for qualified medical expenses.

To use your funds, your account administrator may provide a debit card so you can pay for your health care costs at the point of sale. Or you will pay for costs upfront and submit documentation for [reimbursement](https://livelyme.com/blog/hsa-reimbursement-rules/). Your withdrawals are tax-free as long as you use the money to pay for qualified medical expenses. If you use your money for something else, the money you withdrew will be subject to income tax plus a 20% penalty.

![HSA infographic how money comes out of HSA](//images.ctfassets.net/6j8y907dne6i/4ASMR4GJB8EGJoXPtGWqLj/d6a2d0cf2f363b57abaa037e62026a55/Infographic_Money_Out_HORIZ.png)

__Additional health savings account details:__

- You own your account so you can take it with you from employer-to-employer (or employer to unemployed). 
- Even if you choose a health insurance plan that isn’t an HDHP, you can still use past contributions for out-of-pocket, qualified medical expenses. But you won’t be able to contribute to your account.
- Employer contributions are tax-free.
- If you’re under the age of 65, you must use your contributions for qualified medical expenses.
- Once you reach 65, you can no longer contribute to your account. But you can use your savings to pay for whatever you’d like.  
- An HSA offers triple tax savings: pre-tax or tax-deductible contributions, tax-free interest and investment earnings, and tax-free distributions when used for qualified medical expenses.

## What can I use my funds for?

![hsa-eligible-expenses](//images.ctfassets.net/6j8y907dne6i/42Oe00AuAcE2fs9KFkcmHS/b30013424117eb2a8c42b7c42b094e5c/hsa-eligible-expenses.jpg)

HSA-eligible expenses include (but are not limited to):

- Deductibles
- Copays
- Coinsurance
- Out-of-pocket costs related to diagnostic services like x-rays and blood tests
- Prescriptions
- Quality of life enhancers like air purifiers (with a letter of medical need)
- Medical supplies like band-aids and crutches
- Alternative medicine treatments like acupuncture

This list is not exhaustive. For a comprehensive list of IRS-qualified medical expenses check [“What’s Eligible."](https://livelyme.com/whats-eligible/)

## What happens if I switch employers?

You get to keep your account and every dollar you’ve saved. Although you may not be able to continue contributing to that same account. 

If your new employer uses a different health savings account administrator, you will have two options. [Roll the HSA](https://livelyme.com/blog/rolling-over-your-hsa/) from your previous employer into the new account or maintain two different HSAs. One account from your previous employer - from which you can withdraw but not contribute. And one from your current employer into which you can start contributing.

For more details about your specific situation, contact your HR department.

## Where can I sign up for a Health Savings Account?

![sign-up-lively-hsa](//images.ctfassets.net/6j8y907dne6i/4sUTWDriKFMgGBrIHxeyH9/a36ee79d497005f21445666727ab98e6/sign-up-lively-hsa.jpg)

You can [sign up for an HSA](https://secure.livelyme.com/signup/start) in two places. Through your employer, if it offers this benefit. Or through a financial institution in the private market.

Here, at [Lively](https://livelyme.com/), we offer a private-market HSA that allows you to put your contributions into mutual funds or other investments. That way you can access an even greater benefit: growing your money with the market.

As you can see, there are many ways an HSA can help you save money for health care expenses and retirement. A health savings account can also offer security should you lose your health insurance coverage for a period of time. For more information about HSAs, check out our [HSA Guide](https://livelyme.com/guides/hsa-guide/).


what-is-hsa

Learn the basics of an HSA, including the qualifications for opening and contributing to an account, how much you can contribute, how to use your account, and more!

HSA Basics: Qualifications, Contributions, and More | Lively

The Basics of HSAs: Qualifications, Uses, and More

On May 16, 2023 the [Internal Revenue Service announced the HSA contribution limits for 2024](https://www.irs.gov/pub/irs-drop/rp-23-23.pdf). These are set each year and adjusted for inflation, and 2023 limits are significantly higher than those set for 2023.

For 2024 HSA-eligible account holders are allowed to contribute: 

- $4,150 for individual coverage
- $8,300 for family coverage

This is a $300 increase for individuals and a $550 increase for families from the [2023 HSA contribution limits](https://www.irs.gov/pub/irs-drop/rp-22-24.pdf).

The 2023 HSA contribution limits are: 
- $3,850 for individual coverage
- $7,750 for family coverage

If you are 55 years or older, you’re still eligible to contribute an extra [$1,000 catch-up contribution](https://livelyme.com/blog/what-is-an-hsa-catch-up-contribution/).

To be eligible for an HSA, your health plan has to meet the following IRS criteria for a [high-deductible health plan (HDHP)](https://livelyme.com/blog/what-is-a-high-deductible-health-plan-hdhp/):

__For 2024:__
- Must have a minimum deductible of $1,600 for individual coverage, and $3,200 for family coverage
- Out-of-pocket maximums cannot exceed $8,050 for individual coverage and $16,100 for family coverage

__For 2023: __
- Must have a minimum deductible of $1,500 for individual coverage, and $3,000 for family coverage
- Out-of-pocket maximums cannot exceed $7,500 for individual coverage and $15,000 for family coverage

Annual minimum deductibles have increased $100 for individuals and $200 for families from 2023, and out-of-pocket limits have increased by $550 for individuals and $1,100 for families. 

You can [use our HSA contribution calculator](https://livelyme.com/hsa-contribution-calculator/) to help figure out your optmial monthly contribution.

## How HSAs work

A [Health Savings Account (HSA)](https://livelyme.com/guides/hsa-guide/) is a tax-advantaged savings account. Think of it as a 401(k) for healthcare. In order to [contribute to an HSA](https://livelyme.com/partners/how-to-open-an-hsa/), you must have a high-deductible health plan. 

HSAs allow for tax-deductible contributions, tax-free interest and tax-free withdrawals for qualified medical expenses. This means the money you contribute to an HSA can be used tax-free on health expenses such as prescriptions, copays, and more. This can help you minimize your health care costs throughout the year while saving for the future.

If you choose a high-deductible health insurance plan through an employer, you are likely eligible to contribute to an HSA. If this is the case, your employer can also help to contribute to your HSA before taxes, so you can receive extra savings until you reach the annual contribution limit. 

The main benefit of an HSA? It’s 100% yours. If you leave your job, you can take your HSA (and the funds that you contributed to it) with you. This is different from a [Flexible Spending Account (FSA)](https://livelyme.com/guides/flexible-spending-account-fsa/) in which the funds will get returned back to your employer. 

There are three different tax advantages you can get from your HSA:

- Tax-free contributions
- Tax-free spending for all [qualified medical expenses](https://livelyme.com/whats-eligible/)
- Tax-free growth

The result is the most tax-advantaged account on the market. 

To get started, see if you are [eligible for an HSA](https://livelyme.com/blog/hsa-eligibility-requirements/) or [sign-up](https://secure.livelyme.com/signup/start) for a free account. 


piggy bank on pink background

The IRS announced the 2024 HSA maximum contribution limits. $4,150 for individuals and $8,300 for families. Sign up for your health savings account with Lively today!

2023 and 2024 HSA Contribution Limits

2023 and 2024 HSA Maximum Contribution Limits

The ground shifted under employers as the pandemic caused many workers to reevaluate their values, their jobs, the companies they worked for and even their careers. We likely won’t know the full impact of the pandemic and The Great Resignation for years to come but even with continued economic uncertainty and a potential recession, one thing is clear: employees are demanding more from their employers. In fact, a study from Lively found that in the past year [84% of HR leaders increased benefits](https://livelyme.com/blog/report-employee-benefits-pulse-check/) to attract and retain employees facing a high employee turnover rate.

At the same time, employers have fewer resources and need to keep their budgets in-check while retaining and recruiting talent. They need benefits solutions that offer a bigger bang for the buck, and [80% of HR leaders](https://livelyme.com/blog/report-employee-benefits-pulse-check/) say that competitive financial benefits are more important than they were a year ago. That’s where Health Savings Accounts (HSAs) come in.

## A brief overview

[HSAs are personal savings accounts](https://livelyme.com/guides/hsa-guide/) participants can use to save pre-tax money to pay for [qualified medical expenses](https://livelyme.com/whats-eligible/). Money is contributed to the account tax-free, any interest earned on the money is tax-free and distributions made on eligible expenses are tax-free as well (that’s why HSAs are called triple tax-advantaged accounts). Account owners can choose to [invest their savings](https://livelyme.com/features/invest-your-lively-hsa/) so that they grow at the rate of the market or to keep it in a savings account earning interest. The money never expires and rolls over from year-to-year.

Another beneficial feature is that anyone can contribute to an employee’s HSA. That includes the employee themselves, their employer, their friends and their family. The only caveat is that the total of all contributions must not exceed the [IRS’s annual contribution limit](https://livelyme.com/blog/hsa-contribution-limits/) for that year.

These features make HSAs a good tool to help employees save for future medical expenses and [even retirement](https://livelyme.com/blog/hsas-for-retirement/) as the account functions as a traditional retirement account once the participant turns 65. The only exception is when the account holder uses their HSA to pay for qualified medical expenses as these distributions stay tax-free, even in retirement.

There are a few eligibility requirements for employees to contribute to an HSA:
1. They must be actively enrolled in a [High Deductible Health Plan (HDHP)](https://livelyme.com/guides/hdhp/) and that must be their only health insurance coverage.
2. They must be under the age of 65.
3. They must not qualify for Medicare.
4. They can’t be counted as a dependent on someone else’s taxes.

For these reasons, HSAs are popular among employees. And what’s even better is the same features that are popular, are also beneficial to employers. This makes HSAs a valuable benefit to offer. Let’s take a deeper look.

## Financial benefits

One of the qualities that makes HSAs so valuable to employers is the ability of this account type to lower their cost per employee. HSAs can lower companies' costs directly by encouraging employees to choose more affordable health insurance plans as well as indirectly by lowering the companies’ FICA obligation.

### Reduce the cost of health premiums

The financial benefits HSAs offer employers include the ability to reign in the cost of health insurance. In a recent survey, employers said they expected their spending on medical care to [rise 6% in 2023](https://www.fiercehealthcare.com/payers/employers-expect-healthcare-costs-rise-next-3-years#:~:text=U.S.%20employers%20expect%20healthcare%20costs,be%20over%20budget%20this%20year.), after increasing 5% in 2022. If you’re looking to contain the costs of your benefits package while still offering quality health insurance, consider an HDHP/HSA combination.

According to the [Kaiser Family Foundation (KFF)](https://www.kff.org/report-section/ehbs-2022-section-8-high-deductible-health-plans-with-savings-option/#:~:text=Five%20percent%20of%20covered%20workers,HSA%2Dqualified%20HDHPs%20in%202022), the average annual premium in 2022 for a family HDHP was $21,079, of which employers paid $15,891. Compare this to the average annual premium of $23,003 for a non-HDHP health plan, of which employers paid $16,893 and you can see that offering this type of plan can help you save $1,000 per employee that enrolls. 

A great way to incentivize employees to [enroll in the HDHP](https://livelyme.com/guides/hdhp/) is to pair it with an HSA and, if your budget allows, to offer an employer contribution. You can structure this contribution as a match or a flat amount for all employees who are actively contributing to their HSAs.

### Lower your company’s tax obligation

Since employee contributions to their HSAs are taken pre-tax, their gross taxable income is reduced. The less gross taxable income they have in their paycheck, the less FICA taxes you, as the employer, pays. This is why it’s important to not only offer an HSA, but strategize about how much, if any, you will contribute to employees’ accounts. It might be beneficial to contribute a small amount to encourage employees to enroll in the HDHP/HSA benefits combo, but not too much so that it disincentivizes them to contribute themselves. 

Just like with employees’ contributions, HSA contributions from employers are also tax-free.

To find out how much you can save on FICA taxes by offering an HSA, use our [FICA tax savings calculator](https://livelyme.com/payroll-tax-savings/). 

## Improved recruiting and employee retention

The estimated cost of annual turnover at a mid-sized company costs as much as [$7.5 million](https://www.finra.org/media-center/newsreleases/2021/large-number-americans-reported-financial-anxiety-and-stress-even) and depending on the employee, costs as much as 213% of their salary. Average turnover at all companies is currently about 18% per year. Many employers are left scrambling to adjust their retention and recruitment efforts. If you’re one of these employers, here’s what the experts say you can do to keep more top talent in the building:

1. Make sure your benefits are in line with the [labor market as a whole](https://www.shrm.org/hr-today/news/all-things-work/pages/what-employees-want.aspx), not just your industry. Workers, especially those at entry level will happily jump industries if it means earning a higher wage or receiving better benefits. Note: In 2020, 59% of employers offered an HDHP/HSA combo, compared to 50% of employers in 2016.
2. 88% of job seekers will weigh the chance of getting better health insurance benefits for a lower-paying job against lower-quality benefits at a higher paying job. 
3. Not all employees have the same needs so employers should offer a benefits package that allows for flexibility and personalization.
4. HSAs are popular. KFF found that 24% of all covered workers are enrolled in an HDHP/HSA combination.

To keep employees, you have to keep them happy and a good benefits package with popular, usable options that allow flexibility and personalization is one way to do that. HSAs help employers achieve this by:

1. Giving employees the flexibility to pay for the medical care they want with pre-tax money instead of paying a higher monthly premium for care they might not need.
2. Giving employees a tax-free opportunity to save for future medical costs.
3. Giving employees a tax-free way to augment their current retirement savings plan with an additional savings vehicle.
4. Giving employers an opportunity to show employees they’re invested in their employees’ financial and physical health and well-being. 
5. Giving employees a convenient way to use their savings with debit cards that can be used to pay for medical care at the point of purchase.

## More productive employees

Did you know that a [2013 Gallup study](https://www.stress.org/the-stress-productivity-shortfall) found that employees’ lack of engagement at work costs the U.S. economy $450-550 billion a year? And over 275 million working days are lost a year due to stress? 

In a recent survey, [FINRA](https://www.finra.org/media-center/newsreleases/2021/large-number-americans-reported-financial-anxiety-and-stress-even) found that workers, especially younger employees, are feeling more financial stress than ever before. In fact, 60% of respondents reported feeling financial stress because they’re worried about their futures, mounting medical bills, their lack of savings and the state of their physical health and that of their families.

So what does that have to do with you, the employer? Everything. First, researchers have found a causal link between happiness and productivity. Happier employees are [13% more productive](https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3470734) on average than unhappy employees. Second, stress accounts for 7.2-11.3% of employee turnover annually. Which means the cost of turnover is $251-$14,492 per employee. 

And the employees who stay? Twenty percent of workers report spending at least five on-the-clock hours per week thinking about their stressors. If the employee works 40 hours a week and has an annual salary of $60,000, that’s $1,500 per employee per year in lost productivity.

So what can you, as an employer do? You can give your employees increased opportunities to save and augment those savings with contributions from the company. An HSA is a great way to do that. 

HSAs help alleviate financial stress because they allow participants to set aside money pre-tax to pay for medical expenses. Participants can invest these savings, allowing them to grow their safety net at the rate of the market and to improve their financial well-being. HSAs also help employees answer the question, “How am I going to pay for that?” when an emergency arises. The fact that HSAs can double as a retirement account is another valuable feature for plan participants and can add to their overall feeling of financial stability. 

Employers that contribute to their employees’ HSAs show their workers that they’re invested in them. That investment goes a long way toward making employees feel valued. Which makes them feel happier at work. Which leads to higher productivity. Stress is an insidious cause of lost productivity in the current work environment, but it doesn’t have to be. [An HSA can help](https://livelyme.com/guides/hsa-guide/).

## How to get started

If you’ve decided that offering employees an HSA is the way to go, you’ll want to talk with your benefits professional about how an HDHP/HSA combination fits into your current compensation package. You’ll want to decide which [HSA administrator](https://livelyme.com/) you want to use, as HSAs are health-plan agnostic, meaning they can be used with any qualifying health plan. Then you need to figure out how much (if any) you’re going to contribute to your employees’ accounts.

One thing to consider is that many HSA administrators require [employers](https://livelyme.com/employers/) to do a lot of the heavy lifting when it comes to operating the plan. Lively doesn’t. Once you’ve set up your plan, you simply invite your employees to participate and we take care of their onboarding and education. You’ll be able to manage the plan seamlessly from our clear and informative dashboard and there will be no hidden fees to contend with. If you run into trouble, we’re here to help. We’re your partner in offering the best benefits package possible for your company.

## Find out more about Lively today

If you’re ready to offer an HSA to your company, you can [get started](https://livelyme.com/employers/) or [reach out to our team](https://livelyme.com/employers/) to walk you through the process. 

Group of happy, multiracial employees sit around a conference table discussing business

HSA add employee value

Employers can find lots of value in health savings accounts. Find out the details here.

What’s the value of an HSA?

The Value of Health Savings Accounts

In a world of text, chat and email it can feel like everything is (or has) an acronym. Health insurance plans are no exception. You may have come across the acronym HDHP and are wondering "What is a High Deductible Health Plan (HDHP)?" Continue reading to learn how choosing an HDHP could benefit you. Provided it gives you the coverage you need.

To start, an HDHP is a health insurance plan defined by lower premiums and a higher deductible. But don't let "higher deductible" scare you off. Here are two reasons why an HDHP could make sense for you:

1. All preventative care is covered before the deductible, and
2. HDHPs are an affordable way to get the coverage you need without paying more for extras you may not need.

HDHPs are also the only health insurance option that can be paired with a Health Savings Account (HSA). An HSA can help pay for the high-deductible or to save money for future medical costs.

<iframe src="https://player.vimeo.com/video/377355900" width="640" height="360" frameborder="0" allow="autoplay; fullscreen" allowfullscreen></iframe>

## What is considered eligible?

Annually, the IRS redefines what it considers an HDHP (adjusting for inflation). In 2022, their parameters were a [health plan](https://livelyme.com/guides/hsa-guide/) with a deductible of at least $1,400 for an individual and $2,800 for a family. As well as out-of-pocket expenses that didn’t exceed $7,050 for an individual and $14,100 for a family.

In 2023, the minimum deductibles and out-of-pocket maximums will rise. For individuals the minimum deductible will be $1,500 for individuals and $3,000 for families. The maximum out-of-pocket limits will rise to $7,500 for an individual and $15,000 for a family.

There's one other qualifying characteristic of HDHPs. The individual pays for the cost of healthcare, up to the deductible, before insurance pays for services. The one caveat here is preventative care. All preventative care is covered before the deductible.

## How do they work?

![preventative-care-included-hdhp](//images.ctfassets.net/6j8y907dne6i/5j1glZm5E5y47Fi5eW2T2K/1ebc0d46beb92be8021d514656948957/preventative-care-included-hdhp.jpg)

HDHPs charge participants lower monthly premiums. This is in exchange for requiring higher deductibles and out-of-pocket maximums.

Choosing an HDHP could make sense if you don't need many health care items or services. Or if you only visit the doctor for preventative care. This is because you'll be spending less on your monthly [health insurance plan](https://livelyme.com/compare-health-insurance-plans/) premium. An HDHP could also make sense if you need more care. Here's why.

Because HDHPs have a higher deductible, the IRS allows you to [deposit pre-tax money into a savings account](https://livelyme.com/blog/what-is-an-hsa/) called an HSA or Health Savings Account. HSAs are tax-advantaged accounts because contributions are pre-tax.

![Infographic High Deductible Health Plan plus HSA how you save](//images.ctfassets.net/6j8y907dne6i/5lcCeg9CA7pfdV9jfLrUVG/86661d1a0187b5c1f8408c52a5247e9f/Infographic_HealthPlan_plus_HSA_HORIZ.png)

The distributions and any gains those contributions make can also be tax-free. That's as long as the contributions are used to pay down your deductible or to pay for other qualified medical expenses. Depending on your tax bracket, this could help you save up to 30% on medical expenses.

Where an HDHP could get you into trouble is if you suffer a catastrophic event that requires an expensive procedure or treatment. And you can’t afford the out-of-pocket maximum. Or if you have or develop a chronic condition that needs management.

__Decide which plan is right for you with our [Health Plan Comparison Calculator](https://livelyme.com/compare-health-insurance-plans/).__

To choose an HDHP, you would make the election during the open enrollment period for either your place of employment or in the private market. The other time is after a [Qualifying Life Event](https://livelyme.com/blog/when-should-i-consider-changing-my-health-plan/). If you’ve experienced a life event like the loss of health insurance, marriage, the birth of a child, or death of a dependent, you can sign up for an HDHP at any time during the year with a special enrollment period.

## What are the benefits?

![high-deductible-health-plans-lower-premium](//images.ctfassets.net/6j8y907dne6i/45YNFcVTSqOIH1GiPuzUVQ/150ddbbe5981bcf60c7150e50f13f6d1/high-deductible-health-plans-lower-premium.jpg)

Whether you’re considering an HDHP or have been using one for years, there’s no question that higher deductibles are a tough pill to swallow. The good news is, this type of health plan does offer some unique flexibility and opportunities that other health insurance plans lack.

1. __Flexibility__ – HMO health insurance plans require referrals from a primary care physician. This can be extremely frustrating for individuals who need to have some kind of care outside of a general practitioner. While HDHPs still have in and out of network designations, the list of in-network providers is extensive. And you can see a dermatologist, cardiologist, or other specialists even if you haven’t yet designated a primary care physician.
2. __Lower cost__ – The problem with large, overarching health plans is they try to cover everyone. This might sound good on paper, but not in practice. This often leads to people with low health care needs paying more to cover people with high health care needs. HDHPs reward limited use of the medical system by charging participants low monthly premiums. While also covering preventative care before the deductible is met.
3. __Health savings for the long term__ – HDHPs are the only health insurance plan that you can pair with an HSA. You own the contributions both you and your employer make to your HSA. And they never expire. The funds can be saved or invested in stocks and mutual funds, making these accounts function as a medical safety net. This is beneficial if you lose your employment or your employer changes your health insurance options. Or if your health insurance company decides to discontinue the plan you’re on, or you experience a catastrophic event. Any of which could leave you scrambling to cover unexpected medical expenses. And in the event you don’t spend your contributions before the age of 65, you can use that money, tax-free, for any expenses. Just like another retirement account. 

## Is this plan right for me?

![is-hdhp-right-for-me](//images.ctfassets.net/6j8y907dne6i/1lGHA7VDq1QmkbEHtrozbq/8ce9096c3149cd21eca124e9fb2a5cf3/is-hdhp-right-for-me.jpg)

*The right health insurance plan for you lies at the nexus of affordability and appropriate coverage.* You must be able to afford the monthly premium but also the annual out-of-pocket maximum in case you experience a catastrophic event.

The plan must also provide adequate coverage for your current medical needs. As well as those in the foreseeable future (e.g. having a baby, knee surgery, etc.). Inadequate coverage could cause your out-of-pocket expenses to get out of hand quickly.

So take a look at the specifics for the HDHP you’re being offered. Can you afford that monthly premium? If yes, then take a look at what procedures, treatments, and prescriptions are covered and at what levels. When taking coverage levels into account, can you afford the copays, co-insurance, and other out-of-pocket costs?

Do you have the ability to contribute even a small amount to an HSA? Something to remember about HSAs is the money is contributed pre-tax. That means you could end up saving up to 30% on medical expenses depending on your income taxes bracket.

If, after answering these questions, an HDHP looks like it makes financial sense, then it could be the right plan for you. If you have questions about your specific situation, you should always reach out to your HR department.

HDHPs are often thought of as an [affordable health insurance option](https://livelyme.com/guides/hdhp/), especially for the healthy or if you know you’ll exceed your out-of-pocket maximum. Combine an HDHP's monthly affordability with the option to pair the plan with an HSA, and you have an attractive setup. Not only for those who have limited medical care needs but those who can afford to contribute a little extra each month toward future costs and savings. 

discover "what is a high deductible health plan?"

what-is-a-high-deductible-health-plan

Discover how an HDHP works, its benefits, and if one is right for you. Pair your Lively HSA with a qualified high deductible health plan to start saving today.

Your Crash Course in High-Deductible Health Plans

Understanding High Deductible Health Plans

You’ve heard about HSAs and FSAs. And you think they are a good way to save money for and on medical expenses. And your employer offers both as part of its benefits plan. 

You’re in luck. You get to choose the option best suited to your needs. And yes, you do have to choose. Because you can’t contribute to an HSA and a Healthcare FSA at the same time. Let’s discover which account type will win in HSA versus FSA.

So how do you choose? To make the best decision for you and your family, consider the details of each account. And compare those to the realities of your family’s medical and financial needs.

## HSA vs. FSA Basics

There are some basic facts you need to know to understand the differences between FSAs and HSAs. 

To start, let's look at what these accounts have in common.

Health Savings Accounts (HSA) and Healthcare Flexible Spending Accounts (FSA) are pre-tax accounts. And are both used to pay for qualified, out-of-pocket medical expenses. These include, but aren’t limited to, copays, deductibles, coinsurance, and prescriptions. Because contributions are pre-tax, you can save up to 30% on those out-of-pocket expenses. Depending on your tax bracket.

How are HSAs and FSAs different? The [major difference](https://livelyme.com/blog/differences-between-hsa-vs-healthcare-fsa-infographic/) they have is that an FSA is an employer owned account that pays for short-term expenses. You must use up the FSA funds you contributed by the end of the year.

HSAs are individually owned, and you can use them for short-term expenses, or long-term savings, like retirement. In addition, account functionality and account holder requirements are different for the two account types. 

Let’s learn a little more about each account type.

## What is a Health Savings Account?

![how-to-choose-between-hsa-fsa](//images.ctfassets.net/6j8y907dne6i/1JfvzE56bAaAExlGqDmfjd/eafd5bc19e833ef342e4349e4eb6f630/how-to-choose-between-hsa-fsa.jpg)

A Health Savings Account is a kind of savings account that allows you to [save for health care costs](https://livelyme.com/blog/what-is-an-hsa/). And reduce your taxable income. In other words, HSAs are individually owned, tax-advantaged medical savings accounts. You can open one as an individual or as part of a family plan. As long as you and your family are enrolled in an HSA-eligible [High Deductible Health Plan](https://livelyme.com/blog/what-is-a-high-deductible-health-plan-hdhp/) (HDHP).

### What’s considered an HSA-eligible health plan?

HDHPs are [health plans](https://livelyme.com/guides/hsa-guide#qualifying-for-an-hsa-account/) with a minimum deductible and maximum out-of-pocket expenses set by the IRS that differs for individuals and families.

The IRS adjusts its allowed annual [HSA contribution limits annually](https://livelyme.com/blog/hsa-contribution-limits/) for inflation, and has different limits for individual and family accounts. If you have a [mid-year change](https://livelyme.com/blog/hsa-contribution-limits-mid-year-changes/) – like moving from self-only coverage to family coverage, or vice versa, then your annual contribution limit becomes prorated.

### How does an HSA work?

When you open your HSA, you choose how much you’d like to contribute annually. Then, your employer will deduct the appropriate amount from each paycheck. Your employer may choose to also contribute to your account. But they’re not required to.

If they do contribute, those contributions will count toward your [maximum annual limit](https://livelyme.com/guides/hsa-guide#maximizing-your-savings). Choose your individual contribution amount carefully. And keep in mind that contributions are cumulative. Otherwise, you could end up going over the annual contribution limit.

If you’re under the age of 65, you must use your contributions to pay for qualified medical expenses. These include, but are not limited to:

- Copays
- Coinsurance
- Deductibles
- Acupuncture
- Mental health treatment
- Prescriptions
- Medical supplies like [bandages](https://hsastore.com/SearchProducts.aspx?q=band+aid&utm_source=Lively&utm_medium=TPA+Public+Proprietary+EL&utm_campaign=TPA+Partner), [crutches](https://hsastore.com/SearchProducts.aspx?q=crutches&utm_source=Lively&utm_medium=TPA+Public+Proprietary+EL&utm_campaign=TPA+Partner), [joint braces](https://hsastore.com/SearchProducts.aspx?q=braces&utm_source=Lively&utm_medium=TPA+Public+Proprietary+EL&utm_campaign=TPA+Partner), and more
- Hearing aids
- Dental health
- Vision tests

Want to see the full list of HSA-eligible expenses? Visit [What’s Eligible?](https://livelyme.com/whats-eligible/)

### How age affects HSA use and taxes

![age-affects-hsa-taxes](//images.ctfassets.net/6j8y907dne6i/1mxiaR9se6IhBYokKGgsdd/86de5569ecab00a84ae82f763e30789e/age-affects-hsa-taxes.jpg)

If you’re under the age of 65 and use your contributions for qualified medical expenses, those funds are not subject to federal income tax. But, your state tax liability for contributions depends on your state.

If you choose to use the money for something other than qualified medical expenses, you will incur a 20% tax penalty. And have to pay income taxes on the misused money. After age 65, you can use your health savings on anything you want provided income tax is paid on the amount of the non-qualified disbursement.

## What is a Flexible Spending Account (FSA)?

There is only one type of HSA, and its main use is to pay for qualified medical costs at any age. 

There are three types of FSAs: 

- [Healthcare FSA](https://livelyme.com/blog/what-is-a-healthcare-fsa/)
- [Dependent Care FSA](https://livelyme.com/blog/what-is-a-dependent-care-fsa/)
- [Limited Purpose FSA](https://livelyme.com/blog/what-is-a-limited-purpose-fsa/)

When people use the term “FSA,” they are most often talking about a [Healthcare FSA](https://livelyme.com/blog/what-is-a-healthcare-fsa/), which is a spending account your employer makes available to pay for qualified medical expenses with pre-tax dollars. HDependent Care FSAs are for qualified care expenses, like child or adult daycare. Limited Purpose FSAs are only used for qualified dental and vision expenses. 

The most important thing to remember is that you cannot contribute to a Healthcare FSA or Dependent Care FSA and an HSA at the same time. But you can have a Limited Purpose FSA and an HSA at the same time. 

### How does a Healthcare FSA work?

If you decide you would like to open an FSA, the good news is that you don’t have to purchase a specific health plan. In fact, you don’t have to purchase any health plan.

But you must elect to participate during your employer’s open enrollment period. Or within 30 days of starting employment if you begin your job mid-year. Then, you select the amount you would like to contribute to your account at that time. Your employer will then deduct the appropriate amount from each paycheck.

Your employer can choose to contribute to your FSA but is not required to do so. And their contributions don’t count toward your annual max. Unfortunately, you can’t change this election at any point outside of open enrollment. Unless you’ve experienced a [qualifying life event](https://www.healthcare.gov/glossary/qualifying-life-event/) like the birth of a child, death of a dependent, marriage, or divorce. 

![qualifying-life-event-fsa-contribution-amount](//images.ctfassets.net/6j8y907dne6i/td25GiIFP70vewqfrlrSD/751854829eee489fc8a0c81fddb11efb/qualifying-life-event-fsa-contribution-amount.jpg)

You also lose any unused money at the end of the year. Unless your employer offers either the option to [rollover a small amount of funds](https://livelyme.com/blog/fsa-contribution-limits/) to next year’s account or a 2.5 month grace period during which you can use leftover funds. So choose your contribution amount carefully.

Like with HSAs, the IRS imposes [an annual limit on FSA contributions](https://livelyme.com/blog/fsa-contribution-limits/) that adjusts annually for inflation. Unlike HSAs, FSAs are only opened on an individual basis, so there are no “family plan” increases for annual contribution limits. But if both you and your spouse are offered the opportunity to take part in an FSA at work, you can do so and each can contribute up to the maximum allowed amount.

FSA funds can be used to pay for out-of-pocket medical, vision, and dental expenses not covered by your health insurance plan. Including, but not limited to:

- Copays
- Coinsurance
- Deductibles
- Acupuncture
- Mental health treatment
- Prescriptions
- Medical supplies like [bandages](https://fsastore.com/SearchProducts.aspx?q=bandages&utm_source=Lively&utm_medium=TPA+Public+Proprietary+EL&utm_campaign=TPA+Partner), [crutches](https://fsastore.com/SearchProducts.aspx?q=crutches&utm_source=Lively&utm_medium=TPA+Public+Proprietary+EL&utm_campaign=TPA+Partner), [joint braces](https://fsastore.com/SearchProducts.aspx?q=joint%20braces&utm_source=Lively&utm_medium=TPA+Public+Proprietary+EL&utm_campaign=TPA+Partner), and more
- Hearing aids
- Dental health
- Vision tests

For a full list of medical expenses that you can use your FSA (or HSA funds) on, check out [Publication 502](https://www.irs.gov/forms-pubs/about-publication-502) from the IRS. You can also visit the [FSA Store](https://fsastore.com/?utm_source=Lively&utm_medium=TPA+Public+Proprietary+EL&utm_campaign=TPA+Partner).

## The differences between HSAs and FSAs

![choose-between-hsa-fsa](//images.ctfassets.net/6j8y907dne6i/EqKcpDQS9JGMip8psYcVj/994cea7acae40c6fc14eecff7688fdfc/choose-between-hsa-fsa.jpg)

### Eligibilty requirements

- __FSA:__ Only employers can establish an FSA plan for employees to contribute. Employees can open an FSA regardless of if they have a HDHP or not. Self-employed individuals cannot open an account.
- __HSA:__ Employees are eligible only if they have an [HSA-eligible HDHP](https://livelyme.com/guides/hsa-guide#qualifying-for-an-hsa-account). Individuals are not dependent upon their employer to offer an HSA. And an HSA can be opened from the private market. Self-employed individuals can open an account.

### Contribution sources and changes

- __FSA:__ The contribution amount is chosen during open enrollment or at the time of a qualifying life event. And the contribution amount can not be changed outside of these two time periods.
- __HSA:__ You can change your contribution amount at any time, no major life event required. This gives you the flexibility to increase or decrease your contribution at any time. *__Multiple contribution sources:__* You can grow your HSA in multiple ways. Not only can you add money to your HSA, but your employer, relatives, or anyone who would like to contribute can help your HSA grow.

### Rollover rules

- __FSA:__ Employers choose whether an employee can keep their unused funds or not. There are [three options](https://livelyme.com/blog/fsa-rollover-versus-grace-period/): *__Forfeit__*: Employee forfeits money, and employers get to keep it. *__Grace period__*: Employee has a 2.5 month grace period after the plan year ends to use on expenses. Any remaining money after the grace period is employer’s. *__Carryover__*: Employees can add a small amount of unsued funds, [set each year by the IRS](https://livelyme.com/blog/fsa-contribution-limits/) (in addition to contribution limit). Employers decide the carryover limit, and any funds over the limit are the employer’s.
- __HSA:__ Funds do not expire from year-to-year. Rollover money is in addition to the contribution limits. Money in your HSA can be carried with you and is available even if you change health insurance plans, get a new job, or retire. And funds left in your account grow tax-free through interest or any investment gains.

### Account ownership

- __FSA__: An FSA is owned by the employer. Unused funds belong to employers, not the employee.
- __HSA__: Funds stay with you. One of the best perks of an HSA is that the money you save always stays with you because you own the account. If money is left in your HSA at the end of the year, it stays put. No scrambling around trying to find ways to spend the money before the timer runs out.

### Access to money

![accessing-hsa-fsa-contributions](//images.ctfassets.net/6j8y907dne6i/4lJ6EN6128M5SHmAuh8hzk/60301225072d2cec1be8a6e2fda926ca/accessing-hsa-fsa-contributions.jpg)

- __FSA:__ Money available from day one. Every penny you contribute to your FSA is available at the beginning of the benefit year. Or shortly after the first contribution is made. Say you add $2,000 to your FSA for the year, you’ll likely contribute about $80 per paycheck. Yet, the entire $2,000 is available to use at any time even though you only make small contributions during the year. Another perk? If you leave a position before the year is over, the money spent from your FSA doesn’t have to be paid back.
- __HSA:__ As the employee contributes to their plan. An employee only has access to what has actually been deposited into their HSA account.

### HSA: A savings asset

- *__After the age of 65, your HSA functions like any other retirement account.__* And you can use your HSA money on anything you wish. How does it differ from other retirement accounts? You don’t pay income taxes on money used for medical expenses. You do, however pay income taxes on money used for anything else.
- *__HSAs are assets you can pass on to your kin:__* If your spouse inherits the HSA, it retains its status as a retirement-like account. With the same rules and allowances as it had when you were the account holder. If you pass it on to someone other than your spouse, it stops being an HSA, and inheritance laws apply.

## Understand the pros and cons to find what’s best for you

![is-hsa-fsa-better](//images.ctfassets.net/6j8y907dne6i/7dkm3u9Ez0B7z6r7ZndKdK/d746299a286d54387aae669880b9cbb2/is-hsa-fsa-better.jpg)

While it’s likely you’ll only be eligible for either a Healthcare FSA or an HSA, it is still a good idea to take a look at the pros and cons of both types of accounts. This can help you understand how they align with your greater financial goals and help you decide what healthplan to choose.

### HSA Advantages

- __Portable account__: means you own the account and don’t lose it if you change jobs
- __Triple-tax advantage__: Contribute funds pre-tax, funds grow pre-tax, withdraw funds pre-tax for qualified expenses
- __No use-it-or-lose-it rules__: Spend now or save for retirement.
- __Anybody can contribute to your HSA__: This includes your employer, spouse, family, or friends, as long as you don’t go over the annual contribution limit.

### HSA Disadvantages

- Must enroll in a HDHP and meet other qualifications to have one
- May be subject to fees from the provider
- If you use your HSA for non-qualified expenses over age 65 you'll owe an additional 20% tax penalty on top of any taxes due

### Healthcare FSA Advantages

- __Double tax savings__: Contribute funds pre-tax, withdraw funds pre-tax for qualified expenses
- __Health plan agnostic__: Can enroll in one if your employer offers it, do not need to have a specific type of health insurance plan

### Healthcare FSA Disadvantages

- Only available from an employer, can’t have one if you are self-employed
- Employer owned, means you lose the account if you change jobs
- Subject to use-it-or-lose-it rules, meaning you lose funds if you they are not used during the plan year

## Align Your Goals with Your Savings

Deciding between an HSA and FSA depends on your medical and financial needs. The principal requirement for an HSA is enrollment in an HDHP. And while preventative care is covered before the deductible under HDHPs, most other care is not. That means you will have to pay for your medical expenses for you and your family out-of-pocket until you reach your deductible.

An HSA-eligible HDHP makes the most sense in two cases. First, [if you or one of your family members](https://livelyme.com/features/) has a condition that needs managing by either a specialist or with speciality prescriptions or treatments. In this case, you’ll likely exceed the deductible and be able to use HSA funds to save up 30% on out-of-pocket medical costs.

Secondly, if you rarely use the medical system except for routine preventative care (that includes vaccines and well visits for children) and really want the ability to use your pre-tax account as an investment vehicle to save for retirement. Then, an HSA/HDHP arrangement may be the best choice for you.

To make the best decision for you and your family, start by assessing your past medical needs and those you can project. Then take a look at your finances. Choose the account and health insurance plan arrangement that sits at the nexus of best health coverage and account flexibility.

comparing hsa versus fsa

An HSA and FSA provide up to 30% savings on out-of-pocket healthcare expenses, but you can’t contribute to both. Let’s explore the pros and cons of each account.

HSA vs. FSA: How Do They Compare?

What is the Difference Between a Flexible Spending Account and a Health Savings Account?

Finding the right health insurance plan for you can feel daunting. One of the questions you may be considering is whether you should get an HSA or PPO. The good news is that you might not have to choose at all. Here’s what you need to know about both and how you can utilize them to maximize your health savings.

## HSA vs PPO: Why not both?

Before we get into the details of each option, let’s clear something up. A Health Savings Account (HSA) is a [tax-advantaged account](https://livelyme.com/guides/hsa-guide/) that allows you to save for qualified medical expenses — it’s not a health insurance plan. 

On the other hand, a preferred provider organization (PPO) is a type of health insurance plan that provides access to health care in a certain way. 

In fact, you [can have a PPO plan and an HSA](https://livelyme.com/blog/can-an-hdhp-be-a-ppo/) at the same time. Here’s how they both work.

### Preferred Provider Organizations

A PPO refers to the network coverage your health plan gives you access to. If you get your healthcare with providers who are in the network of your healthcare plan, you pay less for healthcare than with providers outside the network. However, you may still get some coverage with out-of-network providers. 

One major benefit of a PPO is that you don’t have to get a referral from your primary care physician to visit with a specialist. Simply check if they’re in your plan’s network and book an appointment with them directly. 

The biggest competitor to PPOs are [HMOs (health maintenance organizations)](https://livelyme.com/blog/hmo-vs-hdhp/), which allow you to coordinate your healthcare with your primary care physician, but at the cost of having access to a smaller network of providers.

### Health Savings Accounts

An HSA is a type of health savings plan that allows you to set aside money to pay for medical costs, up to a [maximum each year](https://livelyme.com/blog/hsa-contribution-limits/) which is set by the IRS.

Contributions to an HSA are tax-deductible, and your earnings in the account grow tax-free. As long as you use the funds for eligible medical expenses, those distributions are tax-free, too — that’s what the experts call a triple tax advantage.

To be eligible to contribute to an HSA, you have to have a [high-deductible health plan (HDHP)](https://livelyme.com/guides/hdhp/), which has a deductible and out-of-pocket maximum that are higher than traditional health plans. In exchange, they charge lower monthly premiums. 

### Can you get an HSA on a PPO plan?

In a lot of the information you may find online, it can sound like HDHPs, PPOs and HMOs are all separate types of health plans. But [HDHPs are defined only by their deductibles and out-of-pocket maximums](https://livelyme.com/guides/hdhp/) and have nothing to do with your network of providers.

In fact, the beauty of all of it is that it’s possible for an HDHP to be on a PPO network. That’s not to say the two are synonymous, though. Many PPO plans have low deductibles and out-of-pocket maximums, which are usually paired with higher premiums. 

Because this can get confusing, we’ll use the term “typical plan” or “traditional plan” to refer to the low- deductible, high-premium plans you can get on a PPO or HMO network, and we’ll use HDHPs for HSA-eligible plans that you can also get on both networks.

Now, with that out of the way, let’s get to the heart of the matter. The question isn’t whether an HSA is better than a PPO. The question is really whether you want an HDHP that qualifies for an HSA or a low-deductible plan?

## What is an HDHP?

As previously discussed, a high-deductible health plan is one where you have higher deductibles and out-of-pocket maximums than traditional plans, but also lower premiums. 

The limits are [determined each year by the IRS](https://livelyme.com/guides/hdhp/). These figures are sometimes much higher than what you’ll find with a traditional health plan. But the option to contribute to an HSA helps soften the blow a bit, especially if you have a high income and can benefit greatly from the tax breaks HSAs provide.

An HDHP can also be a good choice if you don’t have a history of needing medical care often. While there is a risk of ending up with a higher payment in some circumstances, you’ll have the certainty of lower monthly payments.

## What do traditional PPO and HMO plans offer?

These traditional plans charge higher premiums than HSA-eligible plans, but they also have lower deductibles and out-of-pocket maximums. In fact, some PPO and HMO plans have no deductible at all. They’re great if regular office visits are part of your health regimen.

The difference between a PPO and an HMO is how the provider network works. With an HMO, you’ll deal with your primary doctor most of the time and need to get a referral if you want to see a specialist. A PPO, on the other hand, gives you options to see other doctors and specialists without needing to go through your primary care physician.

## Why should you get an HDHP?

The biggest benefit of an HDHP is that it gives you the option to contribute to an HSA. To give you an idea of the potential savings, let’s say you have a family plan and can contribute $7,200 this year. 

If your effective tax rate for the year is 15%, that contribution cut $1,080 off your tax bill for the year — of course, as long as you don’t use your HSA funds for ineligible expenses.

In addition to saving for upcoming health care costs, you can also use an HSA to save for retirement. Health care is one of the [most expensive aspects of retirement](https://livelyme.com/blog/retiring-how-much-you-will-actually-need-healthcare/), and is estimated to cost an average couple $300,000 to $400,000 to pay for it.

Even if you don’t want to use your HSA for medical expenses in retirement, you can take withdrawals without the typical 20% tax penalty once you reach age 65. That said, the distributions will be subject to income taxes.

HDHPs can also be good if you’re young or generally healthy and don’t expect to spend a lot on medical care throughout the year. Of course, there’s no guarantee you won’t need an expensive procedure or visit to the emergency room. 

Even with most doctor visits, you have to pay the full bill before your insurance coverage kicks in. As a result, HDHP plans are best if your risk tolerance is high. 

## Why should you get a traditional PPO or HMO plan?

A traditional health plan won’t give you access to an HSA. But it can be great if you expect to make regular doctor visits or to get medication frequently throughout the year.

Their lower deductibles mean you’ll hit your limit sooner, and your insurance coverage will kick in earlier. For instance, they’re great if you’re pregnant as you’ll be doing regular check-ups with your doctor while you’re expecting.

Also, it’s possible to get access to a Flexible Spending Account (FSA) with a traditional health plan. FSAs are [another type of health savings plan](https://livelyme.com/blog/hsas-vs-fsas/), but you can only contribute to one if your employer offers it as a benefit. 

FSAs have some of the same benefits as HSAs, including pre-tax contributions (not the same as deductible contributions, but it’s the same concept). Also, when you designate how much you want to contribute over the next plan year, you’ll receive that amount at the beginning of the year instead of waiting to build up the balance through your payroll deductions. 

The biggest drawback of an FSA is its use-it-or-lose-it provision. This means that if you don’t use all of the money you contributed during the plan year, you could lose the remaining balance. 

Employers are allowed to make some exceptions, such as giving you more time to incur qualified expenses or allowing you to carry over some of the balance into the new year. But that’s not guaranteed.

Also, your FSA stays with your employer, so if you get laid off or move to another employer, you lose the money you’ve saved.

## Pros and cons of HDHP plans

Before you pull the trigger on a new health insurance plan, it’s important to understand both the benefits and drawbacks. Here’s a summary of what you need to know about HDHPs. 

### Pros of HDHP plans
- You’ll pay lower premiums than with traditional plans.
- You can contribute to an HSA and enjoy the tax benefits.
- HSAs don’t have a use-it-or-lose-it provision like FSAs.
- HDHPs can also be PPOs and HMOs, giving you more flexibility with your options.

### Cons of HDHP plans
- Deductibles can be high, which can be a colossal financial setback if you’re unprepared.
- Even simple doctor visits can be a major expense, especially if they include tests and screenings.
- You may find it difficult to contribute to an HSA if your out-of-pocket expenses are high every month.

## Frequently asked questions

### Can I have an HSA and a PPO?

Yes! In fact, many HSA-eligible health care plans are part of PPO networks. However, not all PPO plans are HSA eligible. Check if your plan allows you to have an HSA when shopping around.

### Is it better to have an HSA or a PPO?

If you’ve come across this question online, it’s important to note that it’s misleading. HSAs are a form of savings account that you can get with some healthcare plans. PPOs refer to the network your health insurance gives you access to.

But people tend to associate HSAs with HDHPs. And they associate PPOs with low deductible plans. The truth is that you can get a PPO plan that’s also an HDHP and, therefore, eligible for an HSA.

Hence the correct question is: Is it better to have a high-deductible or low-deductible health plan? The answer: it depends. It depends on your risk tolerance, how often you expect to visit the doctor, and how much you can afford to save up.

For instance, if you’re young and healthy and don’t expect a lot of doctor visits, an HDHP is an excellent way to save on monthly premiums. It’s also important to consider how much you can actually contribute to an HSA, which determines your tax benefits.

On the flip side, if you’re older, pregnant or have pre-existing medical conditions that require you to need regular check-ups, a traditional health plan may be a better fit, even with higher premiums. 

Finally, just because you’re young and healthy, it doesn’t mean you won’t max out your deductible or out-of-pocket maximum. You’re essentially betting that you won’t have to spend more on out-of-pocket costs than what you’re saving by not choosing a traditional plan. As such, HDHPs are better for folks with high risk tolerance. 

### What’s the difference between HRA and HSA health insurance?

An [HRA (Health Reimbursement Arrangement)](https://livelyme.com/blog/what-is-an-hra/) has a similar premise to an HSA. It’s a savings account that you can use to reimburse medical expenses. The big difference is that HRAs are only available through an employer, and only your employer can make contributions. 

In contrast, an HSA belongs to you, and you, your employer or anyone else can make a contribution. Also, HSAs are portable, so you don’t have to worry about losing anything if you leave your company.

With an HRA, if you leave your employer, you lose access to that money because it never really belonged to you.

### What’s better, an HSA or an HRA?

Like most things in life, it depends. It depends on you and your needs. HRAs and HSAs also have different benefits for employers and employees.

If you’re an employer, [advantages of an HRA](https://livelyme.com/blog/what-is-an-integrated-standard-hra/) include:
- Tax advantages.
- You can integrate them with FSAs.
- Better employee retention.

However, if you want to offer an HSA to your employees instead, your benefits include: 
- Tax advantages.
- Flexibility with how much you contribute.
- Less record keeping.
- Your workforce becomes more engaged with their health care and medical expenses.
- Lower expenses.

On the other side of the coin, if you’re an employee, the [benefits of an HRA](https://livelyme.com/guides/hra-guide/) include:
- No need for an HDHP.
- It’s completely funded by your employer. 
- You have access to the funds from the first day of coverage.

However, if you choose an HSA instead, here are the advantages:
- Portability.
- Can invest the funds for retirement in mutual funds.
- You get all the tax benefits.
- 
### Are all high-deductible plans HSA eligible?

Not necessarily. They need to meet the requirements set by the IRS to qualify as a true HDHP, which is HSA-eligible. Also, true HDHPs will cover preventive care without requiring you to hit your deductible but offers no other benefits until you reach that point.

Also, it’s important to note that in order for you to be able to contribute to an HSA, you must also meet other requirements, including;
- You have coverage under the IRS’s definition of an HDHP on the first day of the last month of the year.
- You have no other health coverage, and you’re not enrolled in Medicare.
- Someone else isn’t claiming you as a dependent on their tax return.

### Can I have an HSA if my employer offers an HRA?

Yes, but only under very limited circumstances. Most general HRAs will make you ineligible for an HSA. But if your company offers a “limited purpose” HRA or a “post-deductible” HRA, then you may still be eligible for an HSA. Also, if your employer contributes to an HRA that you can only use when you retire, you may be eligible for an HSA.

A “limited purpose” HRA is one where you can only use it for dental, vision or preventative care. A “post-deductible” HRA is one where you can use it to pay for medical expenses after the IRS deductible is met.

### Can I contribute to an HSA without an HDHP?

No. But you can still spend the funds in your HSA or reimburse your medical expenses until the account is empty. 

### Can I have an HSA if my spouse has an HSA?

If your spouse has an individual health policy and no other form of health insurance, then you can get an HSA for yourself, as long as you meet all the other requirements. 

However, if your spouse uses a [health care FSA](https://livelyme.com/blog/what-is-a-healthcare-fsa/), then you wouldn’t be eligible. This is because your partner can also use their FSA funds to pay for your medical expenses. The devil’s in the details, though. If your spouse’s FSA is a limited purpose FSA (one that covers vision and dental only), then you can get an HSA.

### Can an HSA plan have copays?

Yes. The IRS defines copays as an out-of-pocket expense in an HSA-eligible HDHP. HDHPs have to have a [max out-of-pocket limit](https://www.healthcare.gov/glossary/high-deductible-health-plan/).

### Can HRA be used for premiums?

For most employers, the simple answer is no. HRAs were often used by employers to reimburse workers insurance premiums. But, that changed with the Affordable Care Act (ACA). Under the ACA, an HRA can no longer pay for health premiums. There are some exceptions, though.

For example, ACA market reforms do not apply to retirement HRAs and stand-alone. The first option is offered only to retirees, while the second is an HRA with only one plan member. Under these two specific HRAs, you can use them to reimburse health care premiums.

### Can HRA funds be rolled over to an HSA?

As of 2012, you can’t roll funds over from an HRA into an HSA.

### Can you contribute to an HSA without health insurance?

No. To contribute to an HSA, you must be on a qualified HDHP and not otherwise insured. A family member can contribute on behalf of other family members as long as they are eligible. But to be able to contribute to an HSA, you need to have an HDHP.

## How to work out what plan is best for you

When deciding which health plan to choose, you’ll want to take a thorough look at the following factors:
- Do you expect to visit the doctor often? 
- What is your risk tolerance? 
- Will you be able to afford an expensive medical bill if an unexpected event happens?
- How big of a network do you need?
- Can you max out an HSA every year?

Take a clear look at the math of the plans you’re weighing up. Sometimes even though the deductible for a traditional plan is lower, it doesn’t make financial sense if the employer contribution to the HSA in the HDHP plan is high. 

At the end of the day, no-one can tell you what plan is best for you. Only you know your unique situation and your risk tolerance. Consider speaking with a tax advisor to get personalized advice to help you make the choice that’s best for you.

Choosing the right health care plan for you hsa vs ppo

HSA or PPO? The good news is that you don’t have to pick, as long as you have a high-deductible plan in a PPO network.

HDHP HSA vs PPO Plans: Which is better for health insurance? 

What’s the Difference Between an HDHP with an HSA and a PPO?

What if I qualify for Medicare?

If you qualify for Medicare and have HSA questions our articles can help.

What if I am married or planning on getting married?

Here you will find HSA related articles regarding marriage and tax savings.

What if I am unemployed?

Currently unemployed? Find out how you can save on your taxes with these USA articles.

What if I am self-employed?

If you are self-employed in a high deductible health care plan (HDHP) read our articles on how HSA's can help save money on taxes.

What if I have or was offered job-based insurance?

Offered job-based insurance? Read our articles.

What if I just had a baby or adopted?

Whether you had a baby or adopted one our articles on HSA tax savings can help.

What if I had a baby or just adopted?

What if I am under 30?

If you are under 30 and have a high deductible health care plan find out how an HSA can save you money.

What if I have children?

Are you looking for HSA related articles regarding children? Take a look at what we have.

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