What Is a Health Savings Account?

What Is a Health Savings Account?

A health savings account (HSA) is a type of account that you can put money into to save for health-related expenses on a tax-free basis.

You can contribute to a health savings account only if you:
have a high deductible health plan (HDHP)
have no other medical insurance coverage, including Medicare– however, you are permitted to have other types of health-related insurance, such as accident, disability, dental care, vision care, or long-term care
cannot be claimed as a dependent on someone else’s tax return

Both you and your employer can make contributions to your HSA. However, the total amount of the contributions cannot be more than an annual limit set by the government.