There are several benefits and drawbacks associated with a health savings account. One of the most popular HSA benefits are tax advantages. For taxpayers enrolled in high deductible health plans, they can secure a number of tax breaks and rebates. This, however, is not applicable for taxpayers with low deductible health plans. While low deductible plans may increase policy cost over time, the benefit is strictly applied to high deductible medical plans. Since HSAs are individually owned, funds deposited into the account are not subject to income tax. In addition, funds may roll over and accumulate each year if not utilized. For account owners, they may use these funds for qualified medical expenses as desired. There is never any penalty; however, a doctor's prescription is needed to use HSA funds for prescriptions.

While HSA benefits are widely utilized, non-medical account withdrawals may incur penalties. This is especially true if the funds are taken out before retirement age. If left in the account or used for medical purposes only, the user is able to secure funds for future medical purposes. In addition, the benefits retained allow account owners to receive essential care, without a screening process for benefit determination. In other words, health savings account owners have full control over which benefits and funds they wish to use. This, of course, is also based on the terms of their high deductible health policies. For HAS members, they believe this is the best way to ensure individual choices and options for health care. They also believe it helps reduce health care costs, while improving overall health care efficiency.

While a health savings account does have its benefits, there are still a number of factors to consider before investing in one. Several opponents of HSA believe all medical plans should be tax-deductible, even for those who have savings plans. They also believe that healthy individuals will leave their insurance plans, in favor of health savings accounts. A number of people with health issues may also avoid HSAS. As a result, the U.S. health system will continue to experience problems and soaring medical costs. Another drawback relates to deposit amounts. As of 2011, the single contribution limit is $3,050, while family limits are at $6,150. Therefore, account holders are only able to deposit funds based on these contribution limits. They cannot exceed these limits and must wait for the following year; where limits will increase anywhere from $50 – $100.

It is also hard for low-income families to reap HSA tax-break benefits. This is based on median incomes, which only see 3 percent of low income households with HSAs. Furthermore, HSA funds in accounts not FDIC insured are subject to risk.