A healthcare account is a type of savings account that allows individuals to set aside money on a pre-tax basis to pay for qualified medical expenses. These accounts can help lower out-of-pocket healthcare costs by using untaxed dollars to pay for deductibles, copayments, coinsurance, and some other expenses. Healthcare accounts are generally available through banks, credit unions, and other financial institutions. There are two main types of healthcare accounts:

• Health Savings Account (HSA): This type of account is available to individuals who have an HSA-eligible plan, which is generally a health plan that only covers preventive services before the deductible. HSA funds can be used to pay for qualified medical expenses tax-free, and the account may earn interest or other earnings that are also not taxable.

• Flexible Spending Account (FSA): This type of account is available to individuals who have a health plan through a job. FSAs allow individuals to put money into a special account that can be used to pay for certain out-of-pocket healthcare costs tax-free. Employers may also make contributions to an FSA, but they are not required to do so.

Its important to note that HSA and FSA funds generally cannot be used to pay for insurance premiums. Additionally, individuals cannot contribute to an HSA if they have Medicare coverage or a plan that pays its share of a covered service without requiring deductibles or copayments first.