Health Savings Account (HSA)

Health Savings Accounts are a convenient way for those with high-deductible health insurance to save for medical expenses and care. For those that qualify, setting up and using an HSA is easy. Wondering how to open an HSA account? Here are the simple steps:

See if You're Eligible: To qualify for an HSA, you must be enrolled in a high-deductible health plan (HDHP) as defined by the IRS. Unsure if your insurance plan qualifies? West Plains Bank and Trust Company knows HSAs inside and out, and can help you determine if you're eligible in one quick call. 

Open An HSA Account: You don't have time for red tape, so West Plains Bank and Trust Company makes it easy to set up an HSA account. Because the account contains tax-free contributions that must be spent on qualifying expenses, your HSA account will be separate from your other accounts, and will also have a different banking card that's clearly marked as your HSA account.   

Set Up Your HSA Contribution: When you set up an HSA account, you will be asked to specify how much your monthly HSA contribution should be. Usually, this contribution pulls pre-tax dollars directly from your paycheck. There are certain limits on how much can be contributed to an HSA each year. West Plains Bank and Trust Company can tell you how much you'll be able to contribute to your HSA every month down to the penny.

Make Withdrawals: Once the tax-free money starts rolling into the HSA, you can use those funds to pay for qualified medical expenses for yourself, your spouse or your dependents. Examples of qualified expenses include insurance deductibles, co-pays, prescriptions, certain over-the-counter medications and more.

The money in your HSA account comes from your paycheck, so the funds in the HSA account are yours no matter what happens to your employment. As long as you use the money on qualifying medical expenses, you can continue to spend from your HSA account, even if you change jobs.

We focus on putting you in control of your health care finances, and our 140-year commitment to delivering the best technology and customer service makes managing and using your HSA account a breeze.

HSAs have certain key advantages over other ways to pay for medical care, but are only for qualifying account holders. Here's some of the differences: 

• Traditional Savings Account vs. HSA: Both traditional savings accounts and HSAs allow you to save money for future expenses, but only HSAs offer zero-tax contributions that can be spent on qualifying medical expenses. Traditional savings accounts don't offer these benefits.
• Traditional Health Insurance vs. HSA: Traditional health insurance plans typically come with lower deductibles but higher monthly premiums. HSAs are usually paired with high-deductible health plans, meaning you pay less for your monthly premium but more on the deductible before your insurance begins to pay. Unlike traditional insurance, an HSA helps you save tax-free funds for out-of-pocket medical expenses.
• Flexible Spending Account (FSA) vs. HSA: FSAs are similar to HSAs in that contributions are made with pre-tax dollars. However, funds in an FSA must be used by the end of the year or you lose them (which is why they're sometimes referred to as "use-it-or-lose-it" accounts). HSAs offer more flexibility, allowing all unused contributions to roll over year after year.

In today's competitive job market, offering an HSA as part of your employee benefit package can be a game-changer. HSAs empower employees to take charge of their healthcare and finances. That can lead to more financially-secure employees, who are more likely to care for the medical needs that might sideline them with illness. 

West Plains Bank and Trust Company makes it easy to set up an HSA program for your employees. We understand the sometimes complex IRS rules around these types of accounts, and can offer business-focused guidance. Contact us today for more information.