HSA-compatible health plans
What if you had a savings account to help cover health care costs — and the dollars rolled over from year to year? What if the money you spent on health care could help you save on taxes? That’s the power of a health savings account (HSA) paired with an HSA-compatible health plan.
How does it work?
Health savings accounts
An HSA allows you to contribute tax-deductible funds to save for future health care costs, gain tax-free interest on earnings and pay for IRS-qualified medical expenses tax free. You may be able to get an HSA through your preferred bank or credit union. If you want to take advantage of an HSA, you need to be enrolled in an HSA-compatible health plan.
HSA-compatible health plans
At UCare, we offer standard HSA plans and HSA-compatible copay plans. You choose your network (broad or focused) and the level of coverage (bronze or silver) that works best for you. Just like the other UCare Individual & Family Plans, HSA-compatible health plans cover preventive care at 100% and cap your out-of-pocket expenses.
You aren't required to open an HSA in order to enroll in an HSA-compatible plan, but it is a great option for saving money and paying for eligible medical expenses.
Save on taxes
- Deposit the 2026 maximum yearly amount ($4,400 for individuals and $8,750 for families) for the most savings
- Withdrawals are tax free when funds are used for eligible medical expenses
- Any interest you earn on your account is tax free
Is an HSA-compatible plan right for you?
Standard HSA plans
Also known as high-deductible health plans (HDHPs), these health plans offer somewhat lower monthly premiums with the trade-off of lesser up-front coverage before the health plan kicks in. These plans can be a good fit for those who are generally healthy and can fund an HSA and pay the premiums.
HSA-compatible copay plans
The UCare Bronze copay plans are newly eligible to pair with an HSA in 2026. Those who may need regular health care in the plan year — like multiple visits to a chiropractor or monthly prescriptions — may want to choose a copay plan that offers lower up-front out-of-pocket costs.
Never lose your HSA funds
Unlike a flexible spending account (FSA), you can keep funds you don’t use year after year. You can also invest the funds in your account and keep your earnings tax free. Talk to your financial planner or credit union rep about investing your HSA funds.
Once you enroll in Medicare, you can no longer contribute to an HSA. But you can continue to use the funds in your account to pay for qualified medical expenses. You can also use your HSA funds for other purposes after age 65, but you'll pay income taxes for anything other than qualified medical expenses.
HSA FAQ
A health savings account (HSA) is a personal, pre-taxed savings account you can use to pay for some types of medical costs. When you pair an HSA with an HSA-compatible health plan, you get a flexible, tax-advantaged way to cover qualified medical expenses.
This is a health plan that allows you to spend funds from an HSA to cover IRS-qualified medical expenses. Funds in your HSA can be used to pay for medical expenses before and after you have met your health plan deductible — and even for procedures that aren't covered under your health plan, like LASIK.
To be eligible for an HSA, you must:
- Be enrolled in an HSA-compatible health plan (HDHP)
- Not be enrolled in Medicare, a general-purpose flexible spending account (FSA) or covered by another health plan that is not HSA-compatible
- Not be claimed as a dependent on someone else's tax return
Yes. Both standard HSA plans and HSA-compatible copay plans cover in-network preventive services at 100% even if your deductible hasn't been met. If you choose an HSA-compatible copay plan, you'll pay a copay for benefits like primary care and specialist office visits before the deductible. Visit our Individual & Family Plan comparison page to find the right plan for you.
Tax-deductible
Contributions to the HSA are deductible up to the annual limit — just like an IRA. As a result, they lower your taxable income.
Tax-free for medical care
Withdrawals to pay qualified medical expenses are never taxed.
Tax-free interest earnings
Interest earnings grow tax free.
You can withdraw HSA funds tax free to pay for IRS-qualified medical expenses. Common medical expenses include doctor, telehealth and online/virtual visits as well as lab fees, dental and vision care, prescriptions and over-the-counter medications. For a full list of IRS-qualified medical expenses, visit irs.gov and review "Publication 502, Medical and Dental Expenses."
Yes, and interest on your account is tax free.
You can use your HSA funds as soon as you open an account and make a deposit. You are immediately fully vested and have full control over your HSA money.
If you're seen for services, your doctor will submit your claim to your health plan and you'll be billed for those services. The amount you're billed depends on your cost-share (deductibles, coinsurance and/or copayments) until you meet your out-of-pocket maximum. You could then pay that bill using HSA funds. Keep your bills and payment receipts for tax purposes, and talk to a tax professional for help with any tax-related questions.
Keep in mind, there's no charge for preventive care services for all our HSA-compatible plans.
Yes. The limits are set by the IRS and updated each year to account for cost of living increases. For 2026, those limits are:
- Individual coverage: $4,400
- Family coverage: $8,750
If you're over 55, you can make catch-up contributions of $1,000 annually. You are responsible for making sure you don’t contribute more than the allowed amount. You can find up-to-date information at irs.gov.
You have up until the tax filing deadline of the following year to make contributions for the tax filing year.
No. You can deposit one lump sum or make smaller deposits throughout the year. However, your bank may require a minimum deposit or balance.
You’re in charge, but you can keep track by downloading “Publication 502, Medical and Dental Expenses,” a list of IRS qualified medical expenses, from irs.gov. It’s also a good idea to consult with your tax or financial advisor.
Yes, complete Form 8889 each year with your taxes to report total deposits and withdrawals from your account.
Yes. You should keep copies of your receipts for expenses paid with HSA money.
HSA funds roll over each year — there’s no "use it or lose it" rule.
If you do not already have an HSA, there are many banks and credit unions that offer them. You are free to choose any bank you like to open an HSA.
Note: This material is provided for general informational purposes only and should not be considered legal, tax or financial advice. You should consult with a lawyer, tax professional or other financial advisor to determine what may be best for your individual needs.