Can I Open an HSA Without My Employer?

There’s no question that medical expenses take a big chunk out of most people’s budgets these days. Even simple doctors visits can run into the hundreds of dollars, and comprehensive care for hospital stays can be much, much more. While insurance can be useful in offsetting the cost of healthcare expenses, private insurance doesn’t cover all medical expenses.

For example, over-the-counter medications are generally not considered a covered expense through private insurance. Likewise, dental care is often not included in a health insurance plan unless your provider offers an add-on dental option. To pay for these types of expenses, you may have to dig into your own pocket, but there is another way – a health savings account.

What is a Health Savings Account?

A health savings account (HSA) is a private savings account that allows you to place money into it tax-free. Unlike insurance benefits, these funds can be spent on a variety of healthcare expenses, including over-the-counter medications and dental care.

Most people access an HSA through an employer-sponsored insurance plan. In many cases, access to an HSA will be offered alongside a group health insurance policy. This allows all of your benefits to be administrated under one provider, making it easier and more convenient to keep up with everything.

Opening a Private HSA

Despite most HSA accounts being available through employers, you can opt for private health saving account administration. This can be done through investment firms as well as banks, and some people with individual health insurance plans that are not employer-sponsored may also be able to access private health saving account administration through their insurer.

These plans typically operate on the same principles of allowing you to save tax-free funds to be used for healthcare expenses. Because each account administrator is different, you might consider shopping around to find the provider that’s right for your unique needs. Additionally, you will want to check with local healthcare providers to ensure that they accept HSA funds for their products and services.

Read a similar article about HSA account providers here at this page.

Do I Need to Use a Third Party Administrator for My HSA?

Running a business of any size can be difficult, especially with how fast the digital economy moves these days. You already have a lot on your mind, and managing benefits is often just one more thing to worry about. This becomes particularly challenging when you have a large workforce that is spread out across the country or even the world. Different states and countries have different laws and regulations, and keeping up with everything can be a chore.

For some business owners, the solution to these problems is to hire an HR team to handle tasks like health savings account (HSA) management. For others, it may make more sense to go with a third party administrator (TPA) to handle HSA benefits. Which one you choose is up to you, but there are pros and cons to each approach.

Why Choose a TPA?

An HSA TPA can take a lot of the burden off of your shoulders when it comes to managing plans, accounts and benefits. Your HSA TPA acts as an advocate for your company and its employees so that you can focus on other important tasks.

A TPA can also take care of other benefit programs that you provide to employees, including mental health benefit programs and return-to-work programs. Essentially, your TPA functions as an all-in-one administration team for medical benefits.

The Benefits of Handling Your Own HSA Administration

If you choose to keep your benefits administration in-house, you’re going to have much more control over how things are managed. Of course, this means more work for you and your team, but some business owners find this trade-off worth the extra hassle.

Employees may also prefer to deal one-on-one with your company through HR to handle questions and concerns about HSA and other benefits. Working through a third party often means more phone calls, emails and other communications bouncing back and forth. In-house benefits administration cuts out a lot of the bureaucracy and provides a more efficient route for your employees to gain access to the information they need most.

Read a similar article about “difference between HRA and HSA” here at this page.