What is the difference between Health Insurance v.s. a Health Savings Account (HSA)?
Health insurance provides coverage for a wide array of health expenses depending upon the terms of the policy. Policies differ in what they cover, the size of the deductible and/or co-payment, limits of coverage and the options for treatment available to the policyholder.

Health savings accounts (HSAs) work in addition to health insurance policies, particularly "high-deductible health insurance plans." The requirements for a health plan to be considered a "high deductible" (HDHP) vary, depending on whether the covered individual receives single or family health insurance coverage.

For single coverage, the policy must have:

 a minimum deductible of $1,200 and
What is an HSA? a maximum out-of-pocket cost of $5,950.00.


For family coverage, the policy must have:

 a minimum deductible of $2,400 and
What is an HSA? a maximum out-of-pocket cost of $11,900.


A health savings account (HSA) is an IRA-like account funded with pretax dollars that grow tax-deferred. The HSA assets may serve a dual purpose:

What is an HSA? tax-free and penalty-free distributions can be taken to pay for medical expenses, and
What is an HSA? penalty-free (but not tax-free) distributions can be taken for any reason starting at age 65.


In other words, HSA assets not used for medical expenses become retirement assets.

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