Health Savings Accounts (HSA) offer an opportunity for you to build tax-free savings to pay for current and future qualified medical expenses. Used in conjunction with a High Deductible Health Plan (HDHP) a high-deductible plan may cost less overall than making monthly premium payments to a traditional health plan and making co-payments when you require medical care. If you use the HSA/HDHP method, you will pay some of the initial medical costs out of your HSA, up until you meet your HDHP deductible. A traditional health plan would pay for most of those up front, after a more modest deductible. Which method is best for you depends on your medical care needs and the HSA/HDHP and Traditional Plan options available to you.
Health Savings Account or Traditional Health Plan?
Health Savings Account or Traditional Health Plan?
Health Savings Account (HSA) vs Traditional Health Plan
HDHP Qualified Plan Cost
$ 4,040.50
Traditional Plan Annual Cost
$ 6,080.00
Using a High Deductible Health Plan along with a Health Savings Account will save you $2,039.50 annually. You will also have $1,220.00 remaining in your HSA at the end of the year, which can be rolled over into the following year.