What are the key differences of an HSA and an FSA?  Below are some key items to make sure your employees are educated on.  

Contribution Limits
HSA: $3,350 Ind / $6,750 Family
FSA: $2,550

Ownership and control
HSA: You
FSA: Your Employer

Funds Rollover
HSA: Forever
FSA: Up to $500 annually, if adopted by the plan. 

Funds Invested
HSA: Yes
FSA: No

Earnings grow tax-free
HSA: Yes
FSA: No earnings

Contribution changes allowed
HSA: When you want
FSA: No

Withdrawals for non-medical expense
HSA: Allowed at age 65, taxed as income
FSA: Not allowed

Reimbursement Deadlines
HSA: At any time
FSA: Within 90 days of plan year-end

​​Comparing a Traditional, Co-Pay style health plan to a High Deductible Health Plan (HDHP) can be confusing for employees. There is a perception that Co-Pay plans are richer, more comprehensive than a HDHP. While this can be the case, there is often more to the story.  
There are basic questions that employees can ask themselves to help determine the best plan for them:

1. What is the portion of the premium that you will pay for each plan?
2. What is the out-of-pocket max that you will pay for health costs on each plan, before the insurance carrier covers everything?
3. What is your best case scenario (no healthcare usage--just premium paid) vs worst case scenario (high healthcare usage—premium paid + out-of-pocket max) for each plan option?
4. Is your employer making a health savings account contribution?  This amount can be subtracted from the out-of-pocket max for the HDHP.  For example, if I am covered as a single under a $2,000-100% ($2,000 out-of-pocket max) HDHP, and my employer is contributing $1,000 annually to my Health Savings Account, my out-of-pocket max for the year is now $1,000.   

Like most things involving health insurance, selecting the correct plan can be a confusing process for employees.   Keep these items in mind as you begin to prepare for open enrollment.  

SmarterHSA Blog: Start with the Basics

With high deductible health plan (HDHP) election at an all-time high, it’s critical that your employees know how to make best use of an H.S.A.  How do you educate them?  It’s best to do so in a series of communications, both in-person and electronically.   
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Giving employees a base knowledge of the basics is important, regardless of how long a HDHP/H.S.A. program has been offered to them at your organization.  We have seen a lot of confusion about the basics of an H.S.A. over the past couple of open enrollments, so it’s important to not take the basics for granted. 

What are some of the key items that we would consider good starting points?

1. Key differences between traditional plans and high deductible health plans (HDHP).
2. Explain to them what makes a health plan “health savings account eligible/qualified”.
3. The general concept of a health savings account.
4. This is your money.  You do not lose it when you change jobs.  You do no lose it if you don’t use the funds during a particular calendar year.

I will go into more detail about these items, but this is a good reminder to start with the basics.  Keeping the message simple and concise has worked for us when educating employees.

As always, your feedback and comments are appreciated.