Health Savings Account Design and Compliance

Summary

This practice note provides an overview of the requirements for establishing and maintaining health savings accounts (HSAs). HSAs allow individuals covered by high-deductible health plans (HDHPs) to receive tax-preferred treatment of contributions to the HSA to be applied to satisfy medical expenses like deductibles and out of pocket medical expenses. HSAs can be obtained either from vendors individually or in connection with employment. In either case, they are considered individual arrangements for compliance purposes.