Just as car insurance doesn't pay for oil changes, Health Savings Account (HSA) plans don't pay for routine doctor visits and prescriptions until your deductible is met.  Deductibles start at $1,150 for individuals and $2,300 for families.  The result is much lower premiums.

Candace De Long is a client of ours in Fort Collins, Colorado.  She had originally signed up for a co-pay plan from Blue Cross Blue Shield, for which she was paying $408.10 per month.  Her coverage was very rich in benefits, but after her first year she reported that she really wasn’t using it much.

After reviewing her options, Candace decided to switch to an HSA plan with Blue Cross, for only $240.30 per month, lowering her premium by 41%.

It Gets Better…

HSA plans allow you to deposit money into a special account to pay for future medical expenses.  Any money you put in is tax deductible, regardless of your income level, income source, or even whether or not you use the money for medical expenses.

Candace told us that she was planning on maximizing her HSA contribution. Assuming she is in a 28% tax bracket, this will save her $742 in income taxes.

Subtracting her $742 in tax savings from her $2,884 health insurance premium gives him a total net health insurance cost for the year of $2,142 or only $178.50 per month!

This low net premium is the main reason why HSA plans are becoming so popular.

How to establish an HSA

To establish a health savings account, you must own an HSA-qualified high deductible health insurance plan.  First, review all the information on the HSA Info page and check out our Q & A section to familiarize yourself with HSAs.  Then visit our "How to" Guide to learn how to choose the right plan, how to apply for health insurance coverage, and how to set up your HSA.

If you would like assistance in choosing a plan, we are available for no-obligation telephone consultations.  We'll help you analyze available plans so you can choose the one that's best for you.  To schedule an appointment please call us.