The HSA Solution

There are two parts to an HSA solution:

• The Insurance Plan. A health plan with a deductible amount that qualifies you to open an HSA. This is also referred to as a high-deductible health plan (HDHP).


• The HSA Account. An HSA is a tax-exempt account that you can use to pay for qualified medical expenses.

High-deductible plans can have significantly lower premiums than traditional health plans, so consumers pay less out-of-pocket each month for coverage. In exchange, the consumer must assume responsibility for medical expenses until the higher deductible has been met. Once the deductible has been met, the HDHP works just like any other health plan, so consumers are still protected in the event of high or unexpected medical bills.

How do consumers manage the responsibility of a higher deductible? That's where the HSA comes into play: Funds in an HSA are used to pay out-of-pocket eligible medical expenses. In this manner, the HDHP and HSA work together to help consumers more carefully and cost-effectively manage healthcare costs.