Comparing HSAs and FSAs

Health Savings Accounts vs Flex Spending Accounts


Health Savings Account

Flex Spending Account
Qualifications Must be enrolled in HDHP. Cannot be enrolled in additional non-HDHPs or Medicare. None
Health Plan High Deductible Health Plan (HDHP) Any
Contribution Limit Individual Coverage: $3,600. Family Coverage: $7,200 TBD
Catch-Up Contributions Individuals 55 or older may make an additional $1,000 in contributions each year. Not allowed.
Changing Contributions Contribution amounts can be changed at any time. Contribution amounts can only be adjusted during open enrollment or due to a qualifying life event.
Additional Contributions You can make additional contributions at any time, up to your yearly contribution limit. Not allowed.
Effect on Taxes Contributions are tax-free Contributions are tax-free
Do I earn dividends? Yes No
Investment Options You can invest your HSA dollars to earn even more money on your tax-free contributions. No investment options allowed.
Does my money rollover? Yes! Any unused funds in your HSA rolls over each year. FSAs have a “use it or lose it” policy. Any funds not used by the end of your plan year are forfeited.
Account Ownership You own your HSA. If you ever leave the district, your HSA funds & dividends accrued are yours to take with you. Your FSA is owned by the district. If you change employment you will forfeit your FSA & the funds contributed.
Availability of Funds Funds are available as contributions are made. Your full election amount is available on the first day of the plan year.
Retirement Unused HSA funds that you have saved, as well as dividends earned & invested, may be withdrawn after age 65. Your FSA is owned by the district. Once you retire, your FSA is closed.
Qualified Expenses HSA funds may be used for deductibles, medical co-payments, prescription drugs, vision & dental bills. HSA funds may be used for deductibles, medical co-payments, prescription drugs, vision & dental bills.
Non Medical Expenses Non-medical expenses before age 65 are subject to a 20% penalty & must be reported on your taxes. No access to funds for non-medical reasons.
Paying Expenses HSA Debit Card FSA Debit Card or Claim Form