Wondering how an HSA is different from a Health Care Flexible Spending Account (HFSA)? Here’s how:
| Health Savings Account (HSA) | Health Care Flexible Spending Account (HFSA) | |
|---|---|---|
| When to Use | You can use the HSA to pay for eligible medical, dental, and vision expenses under the Bronze, Bronze Plus, or Silver . | You can use the HFSA to pay for eligible medical, dental, and vision expenses under any coverage level. |
| Contributions | You can contribute to your account before taxes. For 2025, the annual limits set by the IRS are $4,300 for individual coverage, and $8,550 for family coverage. If you’re age 55 or older (or will turn age 55 during the plan year), you can also contribute an additional $1,000 catch-up contribution. | You can contribute to your account before taxes, up to the 2025 annual limit set by the IRS of $3,200. |
| Rollovers | HSA funds are yours to keep. They can be rolled over year to year and are not forfeited. If you leave Slalom, you can keep your unused HSA funds with Alight Smart-Choice Accounts or transfer them to another HSA, if available. At retirement, you can move any unused HSA funds to another tax-qualified program, such as an IRA. | Unused dollars don’t roll over from year to year. If you have an unused HFSA balance at the end of the calendar year, these funds will be forfeited under the IRS’s “use it or lose it” rules. |
| Earning Interest | The money in your HSA earns interest. | The money in your HFSA does not earn interest. |
| Debit Cards | Yes, a debit card is available. | Yes, a debit card is available. |
| Investment Option | You can open an investment account when your balance reaches $1,000. | You cannot invest your HFSA balance. |
Which Account Should I Use
For team members with medical coverage that also have an HSA, the Health Care FSA becomes a “limited purpose FSA” (LPFSA) based on IRS rules. This means it can only be used for dental and vision expenses. As a reminder, unused LPFSA dollars don’t roll over from year to year, so it's important that you carefully estimate your anticipated eligible expenses for the coming year.
If you enroll in the Bronze, Bronze Plus, or Silver coverage level, you can use an HSA, a Health Care FSA, or both an HSA and Health Care FSA. If you contribute to an:
- HSA or Health Care FSA, you can use your account to pay for qualified medical, dental, and vision expenses.
- HSA and Health Care FSA, your Health Care FSA will be “limited purpose” and can only be used to pay for qualified dental and vision expenses. However, once you meet the medical plan deductible, then it can be used toward qualified medical expenses as well. Your HSA can be used for qualified medical, dental, and vision expenses.
If you enroll in the Gold or Platinum coverage level, you can use the Health Care FSA to pay for qualified medical, dental, and vision expenses.
