Obamacare: A Look at Health Care Savings Plans

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  • Making Sense of Alphabet Soup
  • HSA
  • HRA
  • FSA
  • HDHP

HSA

Health Savings Account. Think of it as a 401(k) for health care. An individual sets aside money, pre-tax, into a special bank account that can be used for medical expenses. Companies often make contributions to the account for their employees. HSAs are portable, meaning they can be taken with the employee when they leave a company. If used correctly, HSAs help lower taxes three ways: the contributions reduce your taxable income, gains from the invested money are tax free, as are withdrawals for eligible medical costs. (Photo: Joe Raedle/Getty Images)

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