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HSAs, FSAs, or HRAs? What is the Difference?

Healthcare accounts are not all created equal. We compare some of the main differences between HSAs, FSAs and HRAs.

¹ IRS-imposed HSA limits for 2014: The 2014 annual HSA contribution limit for individuals with self-only HDHP coverage is $3,300 (a $50 increase from 2013), and the limit for individuals with family HDHP coverage is $6,550 (a $100 increase from 2013). Annual catch-up contributions for those 55 and over: $1,000.

² In 2014, employee contributions for an FSA cannot exceed $2,500 per IRS Rules. Employer contributions are not subject to limits, but may not discriminate in favor of highly compensated individuals. If employer contributions exceed $500, additional compliance obligations apply.

³ The IRS does not impose HRA limits; limits may be set by the employer.

⁴ Employers may elect to have (i) a “grace” period for employees to use leftover funds from a previous plan year to pay for expenses incurred in the period up to 2 months and 15 days into the new plan year; or (ii) a carryover of up to $500 to the new plan year for payment of medical expenses during the entire year in which it is carried over.