​To be HSA-eligible, an individual must be covered under a qualified high deductible health plans (HDHPs). HDHPs generally have lower monthly premiums and higher deductibles than traditional health plans and an HSA can cover medical expenses until the HDHP deductible is reached. The idea of this design is that the HSA pays for routine, smaller health expenses, while the HDHP offers protection in the event of a catastrophic medical expense, such as an unexpected illness, injury or hospitalization.

HSAs are designed to provide eligible individuals with the following federal tax benefits:​

• HSA contributions are tax-free.
• Interest and other earnings on HSA contributions accumulate tax-free.
• ​Amounts distributed from an HSA for qualified medical expenses are tax-free. 

​A limited-purpose FSA is similar to a general-purpose health FSA—the difference being that there are fewer eligible expenses. Employees are not allowed to contribute to both an HSA as well as a standard (non-limited) medical FSA. They are, however, eligible for an HSA if they use a limited-purpose FSA for their dental, vision, and preventative care needs.

You don't have to spend a lot of energy to help your employees save a lot of time and money. At Sentinel Benefits, we offer all the services and support you need to help your HSA program thrive: 

• Convenient online account access and for complete account management
• Participants can use HSA funds to pay for qualified medical expenses or invest their savings for future healthcare costs
• Access to investment options for HSA spenders
• Coordination with other benefits, such as Limited-purpose FSAs, for compliance and oversight 
• Complete enrollment, processing and operational support