In an era where health care costs seem to constantly increase, finding a smart and tax-advantaged way to manage medical expenses is paramount. health savings accounts (HSAs) have emerged as a powerful tool for individuals and families, offering a unique blend of financial benefits and health care flexibility.  

What Is an HSA and How Does It Work? 

An HSA is a tax-advantaged savings account designed to accompany a high-deductible health plan (HDHP). HSAs offer tax benefits such as deductible contributions, tax-free growth and tax-free withdrawals for qualified medical expenses. They are particularly advantageous for individuals and families looking to save for future health care expenses while enjoying tax advantages. HSAs can also serve as supplemental retirement savings for health care expenses, making them an appealing option for retirees and anyone planning for health care costs in retirement.  

HSAs typically cover various medical expenses and do not have a "use it or lose it" rule, allowing funds to roll over year-to-year. Contribution limits are set by the IRS and can differ for individuals and families. Employers may contribute to employees' HSAs, making them a valuable financial tool for health care expenses and retirement planning.  

What Does an HSA Cover? 

An HSA can be used to cover a wide range of qualified medical expenses, such as the following: 

• Doctor visits
• Prescription medications
• Dental care
• Vision care
• Hospital services
• Medical equipment and supplies
• Mental health services
• Preventive care
• Chronic disease management
• Maternity and pregnancy expenses
• Alternative medicine 

While HSAs offer many advantages, they also come with rules and regulations, including contribution limits and guidelines on qualified expenses. To ensure that an expense is eligible for HSA reimbursement, it's a good practice to consult your HSA provider. Contact Matt Roenker Insurance Agency to see if an HSA plan would work for you.