What Do I Need to Open a Health Savings Account Plan?

Health Savings Accounts are getting popular, so more and more financial institutions are offering them. You can open HSA Accounts through banks, credit unions and a variety of other financial institutions.

Try contacting a financial institution you’re doing business with now or have worked with in the past to ask about setting up a Health Savings Account.

HSA Facts

• HSAs only work in conjunction with HSA-eligible high-deductible health plans
• HSAs are portable – you can take them with you if you switch jobs
• Money you add to your account can accumulate over the years
• You can withdraw funds from your HSA on a tax-free basis to pay, or reimburse, qualified medical expenses, such as doctor's visits and prescriptions

Open an HSA Through Your Employer

If you get health insurance through your employer, you may have seen an HSA-eligible option during last year's open-enrollment period (generally in the fall). Because the HSA law was passed after many employers had already made their 2004 plan decisions, this will be the first time a lot of employees see an HSA-eligible plan offered with their health insurance options.

Talk to your benefits manager to see if HSAs will be on your health insurance menu. Choosing an HSA could reduce your share of premiums significantly, and some employers may choose to fund all or part of the HSA for you -- perhaps even adding a 401(k)-style match.

No permission or authorization from the Internal Revenue Service (IRS) is necessary to establish an HSA.