Compare Spending Accounts
Here's a quick comparison of the key features of three popular healthcare spending account types.
The Basics
| Flexible Spending Account (FSA) | Health Savings Account (HSA) | Personal Care Account (PCA) | |
|---|---|---|---|
| What is it? | An account that allows employees to set aside pre-tax dollars for qualified healthcare expenses | A tax-free*, interest-bearing account for qualified healthcare expenses now and in future years | An employer-funded account to help employees pay for healthcare expenses |
| Who can have it? |
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| Do employees have to get a certain kind of health plan? | They can have any type of health plan, but Humana's FSA is available only with our consumer-driven plans | To contribute, the employee needs to have a qualified High Deductible Health Plan and meet other eligibility rules | The employer decides – usually a PPO plan with a high deductible |
*All mention of taxes is made in reference to federal tax law. Review your state's tax laws to determine the treatment of HSA contributions and earnings.
The Detail
| Flexible Spending Account (FSA) | Health Savings Account (HSA) | Personal Care Account (PCA) | |
|---|---|---|---|
| Who can put money in it? | Employer or employee | Employer, employee, and anyone else | Employer only |
| Is there a limit on how much employees can put in the account? | The employer sets a minimum and maximum annual contribution | The maximum HSA contribution is based on IRS regulations | Employees can't put money into the account |
| When can employees use the money? | Entire amount available at the beginning of the plan year. Healthcare FSA funds available only for services incurred during current plan year. | Employees can spend money contributed to-date | Entire amount is typically available at the start of the plan year |
| What's an eligible expense? |
Items on employer's list of approved expenses – usually medical, dental, pharmacy, and vision expenses
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IRS-approved expenses – medical, dental, pharmacy, and vision expenses
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Items on employer's list of approved expenses – usually medical and pharmacy expenses
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| What if employees don't spend all their funds during the plan year? | After the claims filing deadline, employees lose unspent funds | Unspent funds stay in employees' accounts and roll over from year to year | It's the employer's call, but the funds can stay in employees' accounts for the following year |
| Can employees take funds with them if they leave their current employer? | No | Yes, including any money the employer put in the account | No |
