Value added medical savings plans: FSAs and MSAs

The value added benefits of healthcare Flexible Spending Accounts (FSAs), Health Savings Accounts (HSAs) and Health Reimbursement Arrangements (HRAs) are simple ways that employers offer a more robust benefit offering to employees, without overloading their compensation expense. These benefits give employees the opportunity to pay out of pocket expenses on a pre-tax basis.

FSAs are qualified benefits plans that are subject to IRC Section 125 and ERISA.

MSAs, or Medical Savings Accounts, are a tax deferred trust where money is set aside for future medical costs.  Either employer or employee can make contributions throughout the year, or at once, in a lump sum.  MSAs must be paired with a health plan, and have a higher deductible than FSAs.