Health Spending Account Resources
CareFirst offers BlueFund, a suite of consumer-directed health care (CDH) products designed for pairing with high-deductible health plans (HDHPs).
Our BlueFund products, including health savings accounts (HSAs), health reimbursement arrangements (HRAs) and flexible spending accounts (FSAs), offer lower premiums and important tax advantages. They also give you more control over how you spend your health dollars. For more information on spending accounts, visit the Further learning site.
Health spending accounts allow you to set aside money to pay for qualified medical expenses. Although each of them allow you to use the funds for expenses such as copays and deductibles, there are some important differences among the three types.
Health Savings Account
An HSA is a tax-advantaged savings account that you can use for medical expenses. It is paired with a qualifying health insurance plan; typically, a HDHP, which offers lower monthly premiums in exchange for a higher deductible. If you buy your own insurance, you are only eligible for an HSA.
Please keep in mind, the federal government sets limits on how much you can contribute to an HSA in a tax year. Current contribution information can be found on the U.S. Department of Treasury website.
Health Reimbursement Agreement
An HRA is a medical spending account that is entirely funded by an employer. An HRA reimburses employees and their families for eligible medical expenses. Employers decide what types of expenses are considered eligible.
An HRA is owned by the employer. You don't put your own money into the account and the money isn't considered part of your income. You don't pay taxes on the money in the account, or when you are reimbursed with money from the account.
Flexible Spending Account
An FSA is an employer-established account that works with your health plan. Each year, you can set aside a portion of your salary pretax. You can use that money to pay for qualified medical expenses not covered by your health plan.
You elect a contribution amount for the year. Contribute only what you think you'll need, because any money left at the end of the year does not roll over. Contributions are deducted in equal installments throughout the year from your paycheck, so there’s no extra work on your part.
Throughout the year, you can use the money in your FSA to pay for qualified health expenses. These expenses will count toward your health plan deductible and out-of-pocket maximum.