What is a Health Matching Account (HMA)?
A Health Matching Account (HMA) is a unique health savings solution that combines features of traditional savings accounts with health expense coverage benefits. Unlike Health Savings Accounts (HSAs), Health Matching Accounts are not tied to a specific health insurance plan and offer flexibility in funding and usage.
How Does a Health Matching Account Work?
- Monthly Contributions:
- An individual or employer makes regular monthly contributions to the HMA. These contributions are matched by a specified multiplier, depending on the terms of the HMA plan. For example, if you contribute $100 monthly, the account might match it to provide a total value of $200 or more in benefits for future healthcare expenses.
- Growing Balance Over Time:
- Over time, the balance in your HMA grows faster than a traditional savings account, as the matching feature enhances the value of your contributions. The matching rate typically increases with consistent contributions, providing more coverage for healthcare expenses as time progresses.
- Access to Funds for Healthcare:
- Funds in the HMA can be used for a wide range of healthcare expenses, including doctor visits, prescription medications, dental care, vision care, and even elective procedures that might not be covered under traditional insurance. Some HMAs also offer discounts with participating healthcare providers.
- Flexibility of Use:
- HMAs can be used in conjunction with any primary health insurance plan. Unlike HSAs or Flexible Spending Accounts (FSAs), which have strict rules on qualified expenses, HMAs often provide more flexibility in terms of what expenses are eligible.
Key Features of a Health Matching Account (HMA)
- Matching Contributions:
- The key feature of an HMA is that your monthly contributions are matched at varying rates, significantly enhancing the value of the account over time.
- No Deductible Requirements:
- Unlike HSAs, HMAs are not restricted to those enrolled in high-deductible health plans (HDHPs). Anyone can open and contribute to an HMA, regardless of their insurance plan type.
- Broader Range of Eligible Expenses:
- HMAs typically allow for a broader range of healthcare expenses to be covered, including elective procedures, cosmetic treatments, and even alternative therapies.
- Tax Benefits:
- While HMAs don’t have the same tax advantages as HSAs, where contributions are pre-tax, they do provide an effective way to save on out-of-pocket medical expenses by leveraging matching contributions.
- Portability and Accessibility:
- HMAs are portable; they remain with the account holder regardless of job changes or health plan changes. You can continue to contribute and use the account even if your employment or insurance situation changes.
Advantages of a Health Matching Account
- Rapid Growth of Account Value: Due to matching contributions, the balance grows more quickly than traditional savings accounts.
- Flexible Use: Funds can be used for a wider range of healthcare expenses without the restrictions of HSAs or FSAs.
- No Use-It-or-Lose-It Rule: HMAs do not have the "use-it-or-lose-it" rule like Flexible Spending Accounts (FSAs), allowing unused funds to roll over indefinitely.
Disadvantages of a Health Matching Account
- No Tax Deduction for Contributions: Contributions to an HMA are typically made with post-tax dollars, unlike HSAs which offer a tax deduction.
- Potential Fees: Some HMAs may have monthly fees or administrative charges, which can affect the overall growth of your account.
- Limited Availability: HMAs are not as widely available or recognized as HSAs, which may make finding and opening an account more challenging.
Is an HMA Right for You?
An HMA could be beneficial if you:
- Want a flexible savings account that can be used for a wide variety of medical expenses.
- Are looking for an option to supplement existing health insurance.
- Want to save for both anticipated and unexpected healthcare costs with matching contributions to enhance your savings.
Health Matching Accounts (HMAs) offer a unique way to save for medical expenses with a matching component that can provide more value for your money over time. They can be an excellent tool for individuals or families who want a flexible, growth-focused option for covering a broad range of healthcare costs. If you are considering an HMA or want to learn more about different health savings options, contact Wilkes Agency today for more information!









