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ConnectYourCare
Account
Comparison
In This Section
HOW DO HRA, HSA, AND FSAS COMPARE?
| Health Savings Account (HSA) |
HRA Health Reimbursement Arrangement (HRA) |
Flexible Spending Account (FSA) |
|
|---|---|---|---|
| Account Ownership | Employee/ Individual | Employer | Employer (held in employee’s name) |
| Deposits made by | Employer, employee or both | Employer | Employer, employee or both |
| Separate account | Required; IRA-type account | Not required; can be paid from employer assets | Not required; can be paid from employer assets |
| Expenses covered | Medical, dental, vision expenses, COBRA or retiree medical insurance premiums, LTC premiums or expenses | Medical, dental, vision expenses or insurance premiums, LTC premiums | Medical, dental, vision expenses |
| Accompanying plan requirements | Covered by HSA qualified high deductible plan 2011 and 2012: at least $1,200 self-only, $2,400 family and not covered by any plan that covers medical expenses under the deductible. |
No | No |
| Maximum annual contribution | 2011: $3,050 self-only, $6,150 family
2012: $3,100 self-only; $6,200 family |
None | None |
| Portability | Full portability required | Portability allowed at employer’s discretion | None |
| Roll-over | Full roll-over required | Roll-over allowed at employer’s discretion | None |
| Funds Availability | As deposits are credited | As deposits are credited; may be credited in a lump sum | Full annual election available on first day of coverage (uniform coverage) |
| Claim Adjudication | Not allowed; though participants must retain receipts | Required | Required |
| Compatibility with other savings accounts | May be paired with HRA/ FSA if limited to amounts over deductible, or to dental/ vision only | May be paired with FSA | May be paired with HRA |
| Employer contributions | Can be made on behalf of current employees (account extends to spouse and dependents if family medical coverage) | Can be made on behalf of current, former employees, their spouses and dependents, and spouses and dependents of deceased employees | Can be made on behalf of current employees (account extends to spouse and dependents) |
| ERISA plan | Generally no | Yes | Yes |
| COBRA | Does not apply | Applies | Applies |
| Retirees | Can be covered | Can be covered | Can not be covered |
| healthcare payment card Usage | Yes | Yes for active employees only | Yes for active employees only |
| Contributions for Medicare eligible participants | Contributions can not be made once an individual becomes eligible for Medicare | No limits on contributions | No limits on contributions |
| Qualified medical expenses | Generally, those defined in section 213(d) not covered elsewhere | Generally, those defined in section 213(d) not covered elsewhere | Generally, those defined in section 213(d) not covered elsewhere |
| Distributions for non-medical expenses | Can be made | Can not be made | Can not be made |
| Usage for ineligible expenses | Allowed. Amounts included in income; subject to 20% penalty unless after account beneficiary’s death, disability or attaining age 65 | Not allowed; entire plan may be disqualified | Not allowed; entire plan may be disqualified |
| Distributions for expenses incurred after individual is no longer eligible | Can be made | Can be made at employer’s discretion, or if COBRA is elected | Can be made if COBRA is elected |
| Coverage for sole proprietors, partners and 2% or more S-corp owners | Yes, but not eligible to participate in cafeteria plan used to fund HSA in the workplace | Can not be covered | Can not be covered |