Introduction to HSAs

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Your Introduction to HSAs

(Health Savings Account(s)

What is a HSA?

A HSA (Health Savings Acount) is a tax-free savings account that allows you to use its dollars to pay for qualified medical expenses. In order to qualify for a HSA you must have a qualified High Deductible Health Plan (HDHP). The IRS determines what deductibles makes you elijable for an HSA annually. Health Savings Accounts were enacted into place January 1, 2004. This piece of legistlation Tallows you to accumulate savings to pay for qualified medical expenses. There are certain advantages to putting money into these accounts. You receive favorable tax treatment and have total control of your account. HSA accounts are individual owned, they rollover from year to year and earn interest tax free. As a group employer you must understand the different financial vehicles available for your health plan. HSA accounts are owned by the individual employee and not an employer. This is a major factor to consider. What is better for my corporation? A MERP, HRA, or HSA?

Here's how a HSA works

The most common use of an HSA (Health Savings Account) is in combination with a high deductible health plan (HDHP). HSA's will help to enhance your health benefit plan in many instances and could reduce your overall health insurance costs, to offer better benefits to your employees. Health Savings Accounts only work well in certain situations. This is a good solution for smaller institutions with employees ranging from (2-30) in size.

Does you current consultant or broker manage the healthcare utilization on your health plan? Please take a look at the advantages of a HSA plan

HSAs can be a key component of your employer sponsored group health insurance plan

 

Health Savings Account