Health Spending Accounts are not insurance plans. In general, they offer a way for people to get reimbursed for a variety of expenses related to health. Often, a Health Spending Account is in addition to a regular benefit plan. A Health Spending Account (HSA) must follow the guidelines of the Canada Revenue Agency. The rules of the Income Tax Act of Canada determine who can enroll in an HSA.
HSA’s have some aspects of tax planning and insurance. They are a tool for small business owners to reduce medical costs. There are no premiums or monthly charges associated with a Health Spending Account.
There are further differences as well. HSA’s do not require pre-authorization or claim forms but will accept receipts for reimbursement. In addition, with a HSA, your payments do not have to correspond with treatment rendered.