Understanding HSA and HRA with Health Insurance

Check eligibility on the go — browse 7,000+ HSA-eligible products in the free app.

What HSAs and HRAs are

Health Savings Account (HSA) and Health Reimbursement Arrangement (HRA) are two types of accounts that work alongside health insurance to help individuals manage their healthcare costs more effectively.

An HSA is a tax-advantaged savings account that individuals can contribute to on a pre-tax basis, and the funds can be used to pay for qualified medical expenses. On the other hand, an HRA is funded solely by the employer and reimburses employees for out-of-pocket medical expenses.

Key differences: ownership, portability, contributions

Here are some key points to understand the differences between HSA and HRA:

• Ownership: HSA is owned by the individual, while an HRA is typically owned by the employer.
• Portability: HSAs are portable and belong to the individual even if they change jobs, whereas HRAs are tied to the employer.
• Contributions: With an HSA, both the individual and employer can contribute, but with an HRA, only the employer contributes.

Why these accounts matter

Both HSA and HRA can be valuable tools to help individuals save money on healthcare expenses and plan for the future. Understanding how these accounts work with health insurance can lead to better financial health and peace of mind.

Health Savings Accounts (HSAs) and Health Reimbursement Arrangements (HRAs) are powerful financial tools that supplement health insurance and empower individuals to take control of their healthcare expenses.