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Health Spending Account vs. Wellness Spending Account

Updated: Jan 5

In the realm of employee benefits, two terms that can cause confusion are "Health Spending Account" (HSA) and "Wellness Spending Account" (WSA). While they may sound similar, these two accounts serve distinct purposes in supporting employee well-being. 


1. Purpose:

Health Spending Account (myHSA): Primarily designed to cover eligible medical expenses not covered by traditional insurance plans. This includes prescription medications, dental services, and other health-related costs.  An HSA can either be used as an alternative to traditional insurance or as a “top-up" plan.

Wellness Spending Account (myWSA): Focuses on promoting overall well-being by covering expenses related to preventive measures and lifestyle enhancements. This may include fitness classes, nutritional counselling, stress management programs and more.  


2. Eligible Expenses:

Health Spending Account (myHSA): Targets medical necessities and treatments prescribed by healthcare professionals. Examples include vision care, chiropractic services, and medical equipment.  The list of eligible HSA items is governed by the CRA and this plan is non-taxable to the employee.

Wellness Spending Account (myWSA): Emphasizes a broader spectrum of expenses to foster a healthy lifestyle. This can encompass gym memberships, mental health support, and even spa treatments for relaxation.  The list of eligible items for reimbursement under a WSA is completely custom for each employer and therefore is taxable to the employee.


3. Preventive vs. Reactive:

Health Spending Account (myHSA): Primarily reactive, addressing immediate health concerns and medical needs as they arise.

Wellness Spending Account (myWSA): Takes a proactive approach, encouraging employees to invest in preventive measures to maintain and improve their overall health and well-being.


4. Employee Engagement:

Health Spending Account (myHSA): Typically utilized to address ongoing medical needs or medical emergencies.  

Wellness Spending Account (myWSA): Encourages regular use as employees proactively seek ways to enhance their well-being, resulting in more sustained and preventative engagement.


5. Employer Focus:

Health Spending Account (myHSA): Reflects an employer's commitment to providing financial assistance for essential medical needs, ensuring employees can access necessary treatments.

Wellness Spending Account (myWSA): Demonstrates a broader commitment to employee well-being, fostering a culture of health and proactive lifestyle choices.


In conclusion, while both Health Spending Accounts and Wellness Spending Accounts contribute to employee benefits, they cater to different aspects of health and well-being. The HSA addresses necessary medical needs, while the WSA promotes preventive measures and healthy lifestyles. Employers may choose to offer myHSA, myWSA, or a combination of both based on their organizational goals and the well-being priorities of their workforce.


One of the best ways to offer the advantages of both myHSA and myWSA to employees is to offer myFlexplan.  Click here to learn more about myFlexplan.

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