Health Savings Account (HSA)

Demystifying Health Savings Accounts (HSAs)
What Is a Health Savings Account (HSA)?
A Health Savings Account (HSA) is a tax-advantaged account created for or by individuals covered under high-deductible health plans (HDHPs) to save for qualified medical expenses. Contributions are made into the account by the individual and are limited to a maximum amount each year. The contributions are invested over time and can be used to pay for qualified medical expenses, such as medical, dental, and vision care, as well as prescription drugs.
Remember you must have an HSA qualified health plan to put money away in your Health Savings Account.
HSA Overview
No tax is levied on contributions to an HSA, on the HSA’s earnings, or on distributions used to pay for qualified medical expenses.
Contribution maximums are set by the IRS and usually go up each year.
Unused account balances are carried forward each year and can be used at retirement, similar to an IRA.
HSA Benefits include:
Smart Health works with Oregon insurance providers that offer health plans compatible with an HSA. Compare HSA-compatible health plans in Oregon and select the plan that works best for you and your family
Known as the “Super IRA”
Low premiums
Can be used for Alternative, Naturopathic, Chiropractic & Dental
Advantages of a Health Savings Account
- Deducting 100% of your HSA contributions from your taxable income
- Having the money in your HSA accrue interest and/or gains on a tax-free basis
- Paying no penalties or taxes when you use your HSA to pay for qualified medical expenses
- Having a high-deductible HSA-compatible health insurance plan, which typically has a lower premium than a plan with a lower deductible
Common IRS-Qualified Medical Expenses
Acupuncture
Ambulance
Artificial limbs
Artificial teeth*
Birth control treatment
Blood sugar test kits for diabetics
Breast pumps & lactation supplies
Chiropractor
Contact lenses & solutions*
Crutches
Dental treatments *
Doctor’s office visits & co-pays
Drug addiction treatment
Drug prescriptions
Eyeglasses (Rx & reading)*
Fluoride treatments*
Feminine hygiene products
Fertility enhancement
Flu shots
Guide dogs
Hearing aids & batteries
Infertility treatment
Inpatient alcoholism treatment
Contact lenses and solutions*
Insulin
Laboratory fees
Laser eye surgery*
Medical alert bracelet
Medical records charges
Midwife
Occlusal guards to prevent teeth grinding
Orthodontics*
Orthotic Inserts
Over-the-counter medicines & drugs
Personal protective equipment (PPE)
Physical therapy
Special education services for learning disabilities
Speech therapy
Stop-smoking programs, nicotine gum/patches
Surgery, excluding cosmetic surgery
Dental treatments *
Vaccines
Vasectomy
Vision exam*
Walker, cane
Common Over-the-Counter (OTC) Medicines
Acne medicine
Baby rash ointment
Cold and flu medicine
Anti-diarrheal medicine
Eye drops*
Anti-diarrheal medicine
Feminine antifungal/anti-itch products
Hemorrhoid treatment
Laxatives or stool softeners
Lice treatments
Motion sickness medicines
Nasal sprays or drops
Ointments for cuts, burns or rashes
Pain relievers, such as aspirin or ibuprofen
Sleep aids
Stomach remedies