What is the savings option associated with High Deductible Health Plans (HDHP)?

• A. HSA option
• B. FSA option
• C. HRA option
• D. Pay-as-you-go

Answer: (A)

High Deductible Health Plans are designed to be paired with a Health Savings Account. An HSA is a tax-advantaged savings vehicle you own that you can contribute to and then use for qualified medical expenses. The money you put in reduces your taxable income, it grows tax-free, and withdrawals for eligible medical costs are tax-free. Funds roll over year to year and can be invested, making it a practical way to cover the higher deductible over time. This specific pairing is what makes the savings option associated with HDHPs the HSA. Flexible Spending Accounts and Health Reimbursement Arrangements exist in other contexts and aren’t the standard HDHP pairing, and pay-as-you-go isn’t a savings account.