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What is HSA?
Benefits of Health Saving Account. High Deductible Health Plans
(HDHP) solutions. Save money on your High Deductible Health
Plan.
What is HSA ( Health Saving Plan)?
Health Saving Plan was created in the Medicare legislation
signed into the lay on December 8, 2003. HSA's provide people
with high deductible health insurance an alternative
method to pay for health care expenses tax-free. It
provides more security, affordability, flexibility and control
over their health care dollars. HSA provides money saving
alternative for the individuals who cannot afford the rising
cost of health care.
How it works? The plans benefits best those people who
are self-employed, out of job, between jobs, and in need of
health insurance, but cannot afford the premiums. You can
significantly reduce the health insurance premium cost by buying
a high deductible health plan. You need to open an HSA account
with an approved HSA institution. You deposit money on this
account up to deductible amount tax-free. You will get checks or
debit card to pay for your medical expenses. Depending on the
approved HSA institution, you may have to pay an account set-up
fee, monthly maintenance fee, debit card fee or pay for your
checks. Many health care insurances can sell you HSA as well.
Are you qualified? Only individuals with High Deductible
health insurance plans are qualified to open HSA account.
Federal law requires that the health insurance deductible be at
least $1,000 self-coverage or $2,000 for family coverage. (Note:
these amounts can be adjusted annually for inflation).
The annual out-of-pocket expenses under the plan (including
deductibles, co-pays and co-insurance) cannot exceed certain
amount. Any adult can contribute to an HSA if they have coverage
under High Deductible Health Plan (HDHP), have no other
insurance, are not on Medicare, cannot be claimed as dependant
on someone else's tax return. Individuals age 55 and older can
make additional "catch-up" contribution.
How to open HSA account? If you have High Deducible
Health Insurance Plan, you need to open a HSA account to help
you pay for your medical, dental and vision expenses tax-free.
Banks, credit unions, insurance companies and other financial
institutions are permitted to be trustee or custodians of these
accounts. Your HSA account can be opened as early as your HDHP
coverage effective date. You HSA account is established on the
first day of the following month. You must have HDHP insurance
to open HSA account. You can open your HSA account only with an
approved institution.
Using your HSA account. With your HSA account you can pay
for any qualified medical expenses permitted under federal tax
law. This includes most medical care and services, dental and
vision care, and out-of-the-counter drugs such as aspirin. Yu
can use the money on your HSA account to pay for medical
expenses for yourself, your spouse, your dependent children. You
can pay for medical expenses for your spouse and dependent
children even if they are not covered by your HDHP.
You cannot use HSA money to pay for the insurance premiums,
unless your are on COBRA, have health coverage while receiving
federal or state unemployment benefits.
UNUSED AMOUNT WILL BE ROLLED OVER TO THE NEXT YEAR - YOU WILL
NOT LOOSE YOUR MONEY!
For more information reference The Department of the Treasury
website.
© 2005-2006 Marketing
Daily. All rights reserved.
HSA. Health Saving Plan. High Deductible Health Plan. High
Deductible Health insurance Plan. Save money on medical bills.
All rights reserved.
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