Health Savings Accounts No Longer Subject To Garnishment

Authored by Mark Reinecke

Health Savings Accounts (HSA) are tax-advantaged, high-deductible medical savings accounts intended to encourage saving for future health care expenses. HSAs allow patients to receive needed care without gatekeepers to determine what benefits are allowed and make consumers more responsible for their own health care choices.  HSAs were established as part of the Medicare Prescription Drug, Improvement, and Modernization Act which was signed into law by President George W. Bush on December 8, 2003.  HSAs were developed to replace the medical savings account system. 

 Funds in Oregon HSAs were subject to garnishment (a method of collecting court ordered judgments from the debtor’s accounts) until 2013. A 2013 amendment to Oregon Revised Statute (ORS) 18.345(1)(o) adds HSAs to a list of exceptions to garnishments.  When seeking to garnish a debtor’s accounts, businesses and individuals need to be aware of these exceptions to avoid garnishing protected accounts. 

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