Number: RS21573
Title: Tax-Advantaged Accounts for Health Care Expenses: Side-by-Side Comparison
Authors: Bob Lyke and Chris L. Peterson, Domestic Social Policy Division 
Abstract: Health Savings Accounts (HSA) are the newest addition to an array of taxadvantaged accounts that people can use to pay for unreimbursed medical expenses, such as deductibles, copayments, and services not covered by insurance. First available January 1, 2004, HSAs have largely replaced the similar but more restrictive Archer Medical Savings Accounts (MSAs), which never attracted many participants. In addition, people may have access to two employment-based accounts, Health Reimbursement Accounts (HRAs) and health care Flexible Spending Accounts (FSAs). Collectively, these accounts have some features and objectives in common, but they also differ in important respects. Keeping these accounts straight can be difficult, especially when they are discussed informally using different names. This report provides summaries and background information about the four accounts and then compares them with respect to eligibility, contribution limits, use of funds, and other characteristics for tax year 2008. The report concludes with a discussion of equity and several other issues.
Pages: 6
Date: February 4, 2008