What is defined as a health savings account (HSA) in Workday?

A health savings account (HSA) is correctly defined as a tax-advantaged account for saving for medical expenses. This account allows employees to set aside pre-tax dollars to pay for qualified medical expenses, which can reduce their taxable income. HSAs are specifically designed for individuals who are enrolled in high-deductible health plans (HDHPs), encouraging savings for healthcare costs in a tax-effective manner. Contributions made to an HSA can lower an employee's taxable income and funds can accumulate over time, making them a valuable resource for managing healthcare costs both now and in the future. Additionally, HSAs offer the flexibility of using the funds for a variety of qualified medical costs, providing financial relief and encouraging proactive health management.