6 Common HSA Questions for Open Enrollment, Answered

couple looking at open enrollment options on laptop

Key takeaways:

A health savings account (HSA) is a tax-advantaged account that helps cover healthcare expenses and can also serve as an investment vehicle.
You must be enrolled in a high-deductible health plan (HDHP) to open and contribute to an HSA.
When deciding whether an HSA is right for you, think about your yearly health expenses and whether an HDHP works with your budget.

Open enrollment is your opportunity to choose the health benefits that will support you over the next year. One such benefit is a health savings account (HSA). It can help cover your health expenses today while building savings for the future.

Before making your benefits elections, however, it's important to understand how HSAs work and whether they're the right fit for your health, lifestyle, and financial goals.

Let’s look at the most common HSA questions that come up during open enrollment.

1. What’s the difference between an HSA and an FSA?

HSAs and flexible spending accounts (FSAs) are both tax-advantaged accounts you can use to pay for eligible health expenses, such as out-of-pocket insurance costs, medications, and healthcare products.

The major differences between an HSA and an FSA are:

You must be enrolled in a high-deductible health plan (HDHP) to open and contribute to an HSA. You don’t need to be enrolled in a health plan to access an FSA (but you can be).
Your HSA belongs to you. So, you can take it with you when you change jobs. Your FSA is tied to your employer.
Your HSA funds roll over each year. Your FSA funds are use-it-or-lose-it each year.
You can invest HSA funds and gain tax-free interest and growth. You can only spend FSA funds on eligible expenses.

2. What are the benefits of an HSA?

An HSA’s main benefit is its triple tax advantage:

Contributions to your HSA aren’t taxed. You can make pre-tax contributions to your account through your employer or you can fund your HSA yourself and deduct the contributions on your taxes.
Interest and investment gains are tax-free. As mentioned above, you can invest your HSA funds in stocks, bonds, mutual funds, and more. Any interest or investment growth on your account isn’t taxed.
Withdrawals for eligible expenses are untaxed. You can use money from your HSA to pay for eligible healthcare expenses without penalty. More on eligible expenses below.

When you turn 65, you can withdraw money from your HSA for any expense. But you’ll pay income tax on withdrawals for nonmedical expenses. In this way, your HSA can double as another retirement account.

3. How do I know if an HSA is right for me?

If you’re wondering whether to enroll in an HSA, ask yourself these questions:

What are your annual medical expenses? If they’re low, then you could benefit from an HDHP's lower monthly premiums. If you have moderate expenses but aren’t sure whether you’ll hit the deductible, then an HDHP might not be right for you.
Does your employer contribute to your HSA? If so, this is additional money you can take advantage of for healthcare expenses if you sign up for an HSA.
Are you enrolled in Medicare or another health insurance plan? If not, you’re eligible for an HSA if you select an HDHP.

Thinking about these questions can help you decide whether an HSA is worth it for you.

4. How much should I contribute?

Another common question is how much to put in your HSA. Consider these factors when deciding how much to contribute:

Medical expenses: You may want to contribute at least enough to cover your anticipated out-of-pocket medical spending for the year (including for your spouse and eligible dependents) or to cover your insurance deductible.
Employer contributions: If your employer matches your contributions, put in enough to get the employer match. It’s basically free money.
Short-term spending vs. long-term savings: Your HSA funds don’t expire and grow tax-free. So when calculating your contributions, try to account for what you’ll spend in the near term as well as how much to set aside for future expenses.
Tax savings: The more you contribute, the more you lower your taxable income for the year. Use the HSA Tax Savings Calculator to see how much you can save with your contributions.

Keep contribution limits in mind, too. The IRS determines how much you can contribute to your HSA each year. It updates the limits annually.

For 2026, the HSA contribution limits are:

Individual HDHP: $4,400
Family HDHP: $8,750

5. What can I use my HSA for?

You can use your HSA for eligible healthcare expenses. For an expense to be eligible, it must be for the “diagnosis, cure, mitigation, treatment, or prevention of disease, or for the purpose of affecting any structure or function of the body.”

Health insurance deductibles, copayments, and coinsurance all qualify as expenses, as well as many healthcare products, including:

Curious what qualifies? Use our Eligibility List® to quickly check thousands of products and services that are HSA eligible.

6. How do I enroll in an HSA?

You can open an HSA during open enrollment if you’ve signed up for an HDHP. These plans have higher deductibles (your out-of-pocket cost before coverage kicks in) but lower premiums (the amount you pay each month to get access to the plan).

In addition, all Bronze and Catastrophic plans on the Affordable Care Act marketplace are considered HSA-compatible even if they don’t meet HDHP requirements.

You must also meet these eligibility requirements to enroll in an HSA:

Not be enrolled in Medicare or any other health coverage except what’s permitted under IRS rules
Not be claimed as a dependent on someone else’s tax return

In summary

Open enrollment is your chance to choose the benefits that’ll help take care of you for the following year—and even beyond.

If you're considering an HSA, now’s the time to evaluate your healthcare needs, estimate your contributions, and understand how your funds can be used throughout the year.

Our Learning Center can help you make your open enrollment decision with confidence.

FAQs

Can I enroll in an HSA after open enrollment?

Yes, you can sign up for an HSA at any time. But you must have a high-deductible health plan (HDHP) to be eligible for an HSA.

Can I change my HSA contribution outside of open enrollment?

Yes, you can change your contribution amount at any time during the year.

Each year, you can contribute up to the maximum amount for your HSA until the tax filing deadline for the following year. So, for example, in 2026, you can contribute up to April 15, 2027.

Should I enroll in an HSA or FSA?

It depends on your personal preferences, health expenses, and what your employer offers.

If your employer offers both, consider the pros and cons of each. For example, you can enroll in an FSA without being in an HDHP and the full yearly election amount is available at the beginning of the plan year. But FSA funds typically expire at the end of each year.

And while you need to be enrolled in an HDHP to open or contribute to an HSA, the funds don’t expire and you can invest them tax-free. You can also keep your HSA when you change jobs, unlike an FSA.

Can I have an HSA and an FSA at the same time?

You cannot have traditional HSAs and FSAs at the same time. You can, however, have an HSA and a limited purpose FSA at the same time. These FSAs cover dental and vision costs, but not general medical expenses.

You can also have a dependent care FSA with an HSA, which covers expenses for childcare and adult daycare.