Get Faster Medical Care with a Health Spending Account (HSA) in Canada

By Frontier Team•January 20, 2025•4 min read

Featured Image

A Health Spending Account (HSA) lets you skip long public wait times by paying for private clinics, specialists, and out-of-pocket medical services with pre-tax corporate dollars. Instead of waiting months for an MRI or specialist appointment through the public system, you can use your HSA to access private care -- and the full cost is tax-deductible for your business and tax-free for you.

Understanding Health Spending Accounts (HSAs)

A Health Spending Account (HSA) is a Private Health Services Plan (PHSP) that allows business owners and employees to pay for eligible medical expenses with pre-tax dollars. Rather than covering medical costs with after-tax income and waiting for tax credits, an HSA enables direct reimbursement by a business, resulting in significant tax savings.

How an HSA Helps You Get Medical Treatment Sooner

1. Access to Private Clinics and Specialists

Many Canadians experience long wait times for medical procedures such as MRIs, orthopedic surgeries, or specialist consultations. While these services are covered by provincial health plans, accessing them through the public system can take months or even years. HSAs allow individuals to seek care at private clinics, where wait times are significantly shorter.

For example, if a business owner needs an MRI scan but faces a six-month wait in the public system, they can use their HSA to pay for a private MRI within days. This faster diagnosis can lead to quicker treatment and recovery, improving overall health outcomes.

2. Tax-Free Reimbursement for Medical Expenses

The magic is that HSAs offer a major tax advantage: expenses reimbursed through an HSA are 100% tax-free for the employee and fully tax-deductible for the employer. This means that instead of using after-tax personal income to pay for medical expenses, individuals can effectively use business funds, reducing their tax burden.

Getting started is easy, we can help you with any questions you might have. Also feel free to check out our comprehensive HSA guide.

3. Coverage Beyond Government-Insured Services

HSAs provide flexibility by covering a wide range of medical expenses beyond what provincial health plans include. These may include:

  • Dental and vision care
  • Physiotherapy and chiropractic treatments
  • Prescription medications
  • Alternative therapies (e.g., acupuncture, naturopathy)
  • Mental health services
  • Fertility treatments
  • Private nursing care

This incredible flexibility ensures that individuals can access timely and comprehensive care without waiting for public system approvals, which can often take months, sometimes years

HSA vs. Medical Expense Tax Credit (METC)

While the Medical Expense Tax Credit (METC) allows individuals to deduct certain medical expenses, the tax benefits are limited. The METC only applies to expenses exceeding 3% of net income or a fixed amount set by the CRA, whichever is lower. In contrast, an HSA offers a dollar-for-dollar tax-free reimbursement, making it a far superior option for covering medical costs. (Learn more from our METC comparison guide)

How Frontier HSA Can Help You Get Medical Care Faster

Here at Frontier HSA we make it easy for businesses and individuals to set up and manage their Health Spending Accounts. You can be setup in the same day, and start booking appointments for your health needs. Our system allows users to quickly submit eligible expenses, receive reimbursements, and ensure that their medical costs are covered efficiently all through our app. With a streamlined claims process and a strong focus on compliance with CRA guidelines, Frontier HSA helps business owners and employees maximize their health benefits while reducing financial challenges.

Learn more today! frontierhsa.ca

Simplify Your Business Health Benefits

Get Started