Consumer-Directed Health Plans 101:

CDHP At-A-Glance Comparison

HSAs, HRAs, and FSAs are governed by a variety of federal agencies and regulations. If you're covered by a CDHP, be sure to refer to your plan documents for the specific details of your plan. The following is a general summary of the key features of CDHPs.

 

Health Savings Account (HSA)

 

Health Reimbursement Arrangement (HRA)

 

Flexible Spending Account (FSA)

 
Who is eligible?  
 Checkmark

Any individual covered by a qualified high-deductible health plan

 Checkmark_Blue All employees, except those who are self-employed or work for an S corporation or LLC.  Checkmark All employees, except those who are self-employed or work for an S corporation or LLC.
Who can contribute?  
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Employer, individual, or both

 Checkmark_Blue Employer only  Checkmark Employer, individual, or both
What are the funding options?
 Checkmark Funded account with real dollars  Checkmark_Blue Bookkeeping arrangement; expenses are paid as incurred within the plan design  Checkmark

Employee chooses annual election amount to be captured by payroll deduction; employer reimburses up to the employee's full election amount

Does the balance carry over?
 Checkmark Yes  Checkmark_Blue

Yes, at employer’s discretion; plan can also set carry-over limits

 Checkmark No
Is the account portable?
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Yes

 Checkmark_Blue Yes  Checkmark Yes
Are there interest or investment earnings?
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Yes

 Checkmark_Blue No  Checkmark No
What are the tax advantages?

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Account earns tax-free interest

Checkmark_Blue

Employers may deduct reimbursed employee medical expenses as a business expense

 Checkmark

Employee contributions are tax-free

 Checkmark

Employee contributions through a cafeteria plan are pre-tax; others are tax deductible

 Checkmark_Blue Reimbursements are excludable from employee's gross income  Checkmark Employers with a cafeteria plan enjoy FICA tax savings
 Checkmark

Employers with a cafeteria plan enjoy FICA tax savings

       
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Qualified withdrawals are not taxed

       
 Checkmark Non-qualified withdrawals subject to income tax and 10 percent penalty        

 

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Call (855) 330-2792 or email reform@pacificsource.com.

 

Last updated 12/7/2017