How Can A Health Savings Account (HSA) Help You Save On Therapy Expenses?
In recent years, more and more people have begun to seek mental health support through in-person or online therapy. However, for many individuals, cost can be a significant concern. One way that some people have found to save on therapy is to use a health savings account (HSA). An HSA is sometimes offered as part of a benefits package through an employer, and it typically allows people to save pre-tax dollars that can be used for various health expenses—which often include expenses for mental health care. Keep reading to learn more about HSAs and how they might help you save on online mental health care.
BetterHelp currently accepts HSA/FSA cards and is recognized as an eligible expense by most HSA/FSA providers. Get started today.
What is a health savings account (HSA) for those with a high-deductible health plan?
How is an HSA different from a flexible spending account (FSA)?
In contrast to an HSA, some people may have a flexible spending account, also called a flexible spending arrangement (FSA) in the Internal Revenue Code. This account is usually for those who have an insurance plan other than a Marketplace plan. Like an HSA, an FSA can be used to set aside money, tax-free, to pay for various medical expenses not covered by a health plan. There are different types of FSAs, so it may be important to look at the terms and conditions to confirm that a specific FSA can be used for therapy.
How much can you save on therapy expenses with a tax-free HSA?
The amount that you can save with an HSA is typically equivalent to the money you save on taxes by putting money into such an account. HSA funds generally don’t expire, so you can use the funds even in retirement. This may allow for significant savings when medical or mental health expenses arise.
Is there a tax limit on how much you can put into an HSA?
Most HSAs have a limit on the amount that you can contribute each calendar year. In 2026, the limit for individual accounts is $4,400 per year. For family accounts, the limit is $8,750 per year. In a family account, the funds can typically be used for the main account holder and their dependents (i.e., people who are included on someone else’s tax return).
Can family members contribute to a health savings account (HSA) for mental health expenses?
Anyone can contribute to an HSA. This means that friends and family members can put money into an account to help a person cover mental health expenses. During mental health challenges, some people experience interruptions to their work and income flow, so family members may step in and contribute to mental health care costs by adding funds to a person’s HSA. Also, the interest and other earnings from an HSA are not taxable, which is an additional advantage of using these accounts to save for mental health care.
Can retirees use health savings accounts?
Once an individual enrolls in Medicare, they can no longer contribute to a health savings account. However, they can still use funds in an HSA to cover expenses not covered by Medicare or Medicare Supplement Insurance. This may help retirees who are seeking support for various mental health challenges.
Can an HSA be inherited, and what are the tax implications?
When a person passes away, they can leave their HSA funds to their spouse. This may allow them to use funds for mental health support. If an HSA goes to someone other than a person’s spouse, that person typically has to withdraw the funds and pay income tax on them.
Online therapy and HSAs
Online therapy platforms like BetterHelp accept HSA/FSA cards and are recognized as an eligible expense by most HSA/FSA providers. Individuals might consider speaking with an account specialist and/or tax expert about any repercussions for federal or state taxes, but these accounts typically allow people to save on taxes.
Getting started with online therapy
Whether you plan to use an HSA, FSA, or pay out of pocket, getting started with BetterHelp is easy. Simply fill out the brief onboarding questionnaire about your needs and preferences in a therapist. You can then be matched with a licensed therapist accordingly, who you can meet with via phone, video, or live chat.
What the research says about online therapy
In many cases, online therapy can be as effective as in-person therapy for treating common mental health concerns, and a growing body of research supports this. For example, consider a 2021 study which suggests that online therapy may be “no less efficacious” than in-person therapy in many cases.
How to use FSA/HSA on the BetterHelp platform
Did you know BetterHelp accepts FSA/HSA cards and is recognized as an eligible expense by most providers? Don’t let your dollars go to waste and invest in your mental health before the year ends. For FSAs, remember “use it or lose it”: consider applying remaining funds before the year ends. Because some FSA plans don’t allow subscription charges, try charging your FSA card first; if that method doesn't work, you should be able to pay with a personal card and submit itemized receipts for each session (sessions are usually FSA-approved). To explore using your FSA/HSA funds on online therapy platforms to support your mental health, we recommend checking with your employer/benefits administrator to see if this is a covered expense.
Insurance coverage for online therapy
Some BetterHelp therapists can accept insurance for online therapy sessions, but this depends on the state where they practice. BetterHelp is currently working with select insurers to join their networks so that more people can receive coverage for online therapy. In the meantime, some people may be able to use HSAs and FSAs for online therapy services. Also, the cost of online therapy at BetterHelp tends to be comparable to that of traditional in-person therapy without insurance coverage. Financial aid may also be available to qualifying individuals.
Takeaway
What is the downside to an HSA?
One of the potential downsides to an HSA plan is that you generally must have a high-deductible health insurance plan in order to use one (that is, a plan that could have a high deductible and, in some cases, high premiums). Another downside is that there may be annual contribution limits set by the Internal Revenue Service (IRS) to take into consideration. Plus, you may have to pay penalties if you use money from your HSA contribution to get reimbursements for a non-approved expense. Expenses are typically subject to the process of completing verification.
Is it better to put money in a 401k or HSA?
It depends on your situation. Many financial advisors suggest that employees contribute enough to their 401k in each plan year to get the full match from their employer, if applicable. However, it could be more of a priority to contribute to an HSA in the short term if you expect you may have many medical expenses to cover in the near future.
Do you lose HSA money if you don't use it?
Each contribution you make to your HSA and other earnings you make on your HSA will stay there until you spend it. Unlike other accounts, HSA money in the bank does not expire.
What is the HSA loophole?
According to Forbes, there is an HSA loophole that may interest holders of this type of account. It involves delaying your “qualified medical expense reimbursement indefinitely, while allowing the pre-tax funds in your HSA account to grow tax-free.” If you have questions about expenses incurred that may qualify for an HSA, how the earnings proceeding from this account can be used, or another concern in connection to your contribution amount, the grace period, or something else, contact a qualified financial professional.
Can you withdraw from HSA (health savings accounts)?
Non-retired people can typically withdraw money from an HSA at any time to use it for a qualified medical expense. However, there may be different rules once you’re retired. Also, withdrawing funds for a purpose besides a qualified medical expense could result in penalties.
Can I use HSA for mental health therapy?
In many cases, you may be able to use HSA funds for therapy. Many companies consider this a qualified medical expense.
Can you use a HSA card for a psychiatrist?
In many cases, you may be able to use HSA funds to see a psychiatrist. Many companies consider this a qualified medical expense.
Can I use my HSA to pay for BetterHelp?
BetterHelp accepts HSA/FSA cards and is recognized as an eligible expense by most HSA/FSA providers. Many companies consider this a qualified medical expense.
What is the difference between a FSA and HSA?
Both can be used to pay for expenses that one’s health plan does not cover. However, people with an HSA usually have a high-deductible health plan, while people with an FSA may have a non-Marketplace insurance plan—such as one through their employer.
Is FSA worth it if I have HSA?
Each person's situation is different. Contact a qualified financial advisor if you have questions about taxable and non-taxable accounts like these.
Are HSAs for high-deductible health plans?
Yes. In most cases, HSAs are available to individuals with high-deductible health plans. These accounts may help such individuals pay for healthcare-related expenses that their plan does not cover.
- Previous Article
- Next Article