Health Savings Accounts

Health Savings Accounts

HSAs are often described as “medical IRAs.” That’s because both products share tax-shelter benefits. HSAs were created by the U.S. Treasury in 2003 as a way for individuals who were covered by high-deductible health plans (HDHPs) to receive tax-preferred treatment on money saved for out-of-pocket medical expenses such as doctor visits, vision and dental care, and prescriptions. Generally, any adult who is covered by a high-deductible health plan - and has no other first-dollar coverage - can establish an HSA.

Salin Bank offers a convenient Debit Master Card for your HSA account at no additional charge.  You can also order checks to access your HSA account!

HSAs - Answers to your questions

Health Savings Account

TypeMinimum DepositCompoundingRateAPY*
Health Savings Account$1 - $4,999Monthly0.12%0.12%
Health Savings Account> $5,000Monthly0.17%0.17%

Variable rate current as of 05/01/2015 and subject to change at any time. Fees may reduce earnings. *APY = Annual Percentage Yield

Monthly Service Fee  
$3.00 Paper Statement Fee - Enroll account in E-Statements to waive the monthly statement service charge
HSAs have grown in popularity among employers and employees in recent years, spurred in part by recent changes in health-care laws. According to America’s Health Insurance Plans (AHIP), a national trade association representing the health insurance industry, nearly 17.4 million Americans were covered by HSA-eligible insurance plans in 2014, an increase of nearly 12 percent since 2013.
One reason for the boon in HSAs is its “triple tax advantage” feature.
  1. Money deposited is on a pretax basis.
  2. Once in your account, money grows tax-free and is yours to keep. Unlike a Flexible Spending Account (FSA), unused funds roll over year to year. There's no "use it or lose it" penalty.
  3. Money can be withdrawn tax-free to cover qualified medical expenses.
For employers, the benefits of offering HSAs to employees include reduced healthcare insurance costs. In addition, contributions made by an employer to employees’ HSA plan are tax-free. At the same, employee contributions made through payroll deduction reduce employer taxes. A HSAs also can be used as a savings tool for employers to compliment employees’ future retirement accounts.

For employees, HSAs enable them to lower their health-care premiums; use available tax benefits; gain more control over their health care; become more aware of healthcare costs and therefore become more educated consumers; and build a savings account with tax benefits to pay for future medical expenses.

Additionally, HSAs are portable. Once you have an HSA, it is yours to keep even if you change plans, jobs, or retire. Finally, if your spouse is the designated beneficiary of your HSA, it will be treated as your spouse’s HSA after your death.

The amount of money that HSA holders can contribute in their HSA account each year is set by federal regulations.  In 2018, those limits are $3,450 for an individual and $6,900 for a family (Account holders over the age of 55 can contribute an extra $1,000 annually). Minimum annual deductibles are $1,350 for self-only coverage or $2,700 for family coverage.  Annual out-of-pocket expenses (deductibles, copayments and other amounts, but not premiums) cannot exceed $6,650 for self-only coverage and $13,300 for family coverage.