Health savings accounts, explained: A simple way to save for health care | hioscar Blog | Oscar
Health savings accounts, explained: A simple way to save for health care
Learn how HSAs help save for healthcare. Eligible Oscar members can open and manage an HSA through HealthEquity.
Plan Basics Oscar Health Insurance
5 min read
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A Saturday morning soccer game turns into an urgent care visit, and your child needs stitches. A few months later, your eye doctor tells you that you need prescription glasses. Then flu season arrives, along with a trip to the pediatrician.
None of those expenses may be life-changing on their own. But together, they can add up fast. That’s where a health savings account (HSA) comes in.
If you’re enrolled in an Oscar HSA-eligible high-deductible health plan, an HSA gives you a place to set aside pre-tax money for qualified health care expenses. You can use those funds to pay for things like doctor visits, prescriptions, dental care, vision care and many over-the-counter products. If you don’t spend everything in your account this year, the unused money rolls over each year and stays with you if you change jobs or health plans. The point is to have money waiting when a prescription, urgent care visit or routine expense comes up, including costs you may need to cover before reaching your deductible.
Eligible Oscar members can open and manage an HSA through HealthEquity. Start by confirming that your Oscar plan is HSA-eligible, then follow the enrollment instructions provided with your plan. You can also visit HealthEquity’s Oscar HSA Guide for educational resources, frequently asked questions and account information.
Healthcare expenses can be difficult to predict. Some years, you may only need an annual checkup and a prescription refill. Other years bring a broken wrist or a few extra visits to a specialist. An HSA can help with both.
Unlike some other health care spending accounts, there’s no pressure to spend your balance before the end of the year. If you don’t need the money today, it stays in your account until you do.
High-deductible health plans have lower monthly premiums, so you may choose to put some of the money you save into your HSA and you may have the option to invest some of it. Even modest contributions can build over time and make the next unexpected bill feel more manageable. Instead of starting from zero when you need care, you already have money set aside for the expense.
Triple-tax savings
HSAs also come with three federal tax advantages when they are used correctly:
Money can go into the account before federal income taxes are taken out
Earnings in the account can grow tax-free
And, withdrawals for qualified medical expenses are not subject to federal income tax.
Remember that state tax rules vary, so consider speaking with a tax professional about your specific state and situation.
A common misconception
One of the biggest misconceptions about HSAs is that they’re only useful if you expect high medical bills.
Many people use an HSA for ordinary expenses such as prescriptions, copays, dental work or new glasses while also leaving some money in the account for later. If you have a healthy year, the balance remains yours. There is no use-it-or-lose-it rule.
If you’re saving some of that money for the future, you may also have the option to invest a portion of your HSA balance. Your money won’t automatically be invested, so you’ll need to take action if that’s something you want to do.Investing can give your HSA savings more opportunity to grow over time, but investments can also lose value. Check your HSA’s investment options, fees and requirements before getting started. Research shows that the average balance of an HSA with investments was nearly 10 times larger than the average balance of a funded HSA without investments.
Know how much you can contribute
The IRS sets a yearly limit on how much can be contributed to an HSA. For 2026, the limit is $4,400 for self-only coverage and $8,750 for family coverage. People age 55 and older may contribute an additional $1,000.
Those limits include contributions from all sources, including money added by you, an employer, or another organization. Your eligibility during the year can also affect how much you are allowed to contribute, so review the current IRS rules or speak with a tax professional before trying to reach the maximum.
Use your HSA for qualified expenses
HSA funds can be used for thousands of qualified medical expenses. Common examples include doctor visits, prescriptions, dental treatment, eye exams, glasses and many eligible over-the-counter products.
Before using HSA money for an expense, confirm that it qualifies. Keep receipts and other records in case you need to show that a withdrawal was used for eligible health care.
Invest for your future
If your HSA offers investing and you have enough set aside for near-term costs, you may be able to invest part of the balance. Investments can lose value, so this option will not be right for everyone. Review the fees, risks and account rules before investing.
After age 65, you may withdraw HSA money for non-medical reasons without paying the additional tax penalty that usually applies to non-qualified withdrawals. Those withdrawals are generally subject to ordinary income tax. Money used for qualified medical expenses can still be withdrawn tax-free. Unlike many retirement accounts, HSAs do not require you to take minimum distributions.
Who can open an HSA?
To contribute to an HSA, you must be enrolled in a qualifying high-deductible health plan. You generally cannot be covered by another health plan that is not HSA-eligible, enrolled in Medicare or claimed as someone else’s dependent.
In 2026, HSA-qualified HDHPs must have a minimum deductible of $1,700 for self-only coverage and $3,400 for family coverage and an annual limit on out-of-pocket expenditures for covered benefits that does not exceed $8,500 and $17,000, respectively.
Not sure whether your plan is HSA-eligible? Your health plan materials or member portal can help you confirm. Eligibility rules can be detailed, so check your plan documents before opening or contributing to an account.
How Oscar members can get started
Oscar members can open their HSA account by visiting the HealthEquity website. Once your account is open, you can begin contributing money and use those funds to pay for qualified medical expenses as they come up. If you ever have questions, HealthEquity offers 24/7 member support to help you manage your account at any time. As an added benefit, eligible Oscar members can receive a $25 contribution from HealthEquity when they open and fund a new HSA account.
If you’ve been thinking about opening an HSA, even modest, regular contributions can make a difference over time. You don’t have to predict what health care you’ll need next year. You just have to know that when the unexpected happens you’ll be better prepared.
