What Qualifies as HSA Plan?

When it comes to Health Savings Accounts (HSAs), there are certain qualifications that a plan must meet in order to be considered an HSA plan.

Here are some key points to keep in mind:

• An HSA is a type of savings account that allows individuals to save money tax-free for medical expenses.
• In order to qualify as an HSA plan, the individual must be enrolled in a High Deductible Health Plan (HDHP).
• The HDHP must meet specific deductible and out-of-pocket maximum limits set by the IRS each year.
• For 2021, the minimum deductible for an HDHP is $1,400 for an individual and $2,800 for a family.
• The out-of-pocket maximum for 2021 is $7,000 for an individual and $14,000 for a family.
• Contributions to an HSA are tax-deductible, and the funds can be used to pay for qualified medical expenses, such as doctor visits, prescriptions, and more.
• HSA funds roll over from year to year, and the account is owned by the individual, meaning it can be taken from job to job.

Health Savings Accounts (HSAs) are a fantastic way to save for future medical expenses, but it's essential to understand what qualifies as an HSA plan.

To be eligible for an HSA, you must have a High Deductible Health Plan (HDHP), which has specific requirements you need to keep in mind.

For instance, in 2021, the minimum deductible for an individual on an HDHP stands at $1,400, while for a family, it’s $2,800.