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March 28, 2011
Learn Facts About Health Savings Accounts That You Should Know
Health Savings Accounts have been gaining popularity with consumers ever since they started way back in 2004. Once you have a high-deductible health plan (HDHP) that is qualified to work with a Health Savings Account (HSA), you are eligible to open an HSA. HSA plans allow you to deposit tax-deductible funds into an HSA that you can use to cover qualified medical costs until your deductible has been met. If you were not able to use the contributions for that year, the money would be carried over to the next year and it would continue to grow with tax-free earnings.
HSA plans allow individuals to be more responsible when it comes to health care decisions. In addition, consumers are getting a Health Savings Account because it helps reduce income taxes. Contributions placed in your HSA are tax-deferred and withdrawals are tax-free when used to pay for qualified medical bills.
However, HSA plans are not available for everyone because insurers are still allowed to decline applications from people who have pre-existing medical conditions. Independent health insurance brokers generally are familiar with the underwriting practices of various insurers and may be able to suggest which companies have less strict underwriting policies. That may help you find coverage, but you might still have exclusions on your coverage.
You will still have rate increases on your premiums even if you have an HSA plan. With underwriting evaluating the potential cost to pay for your heath care, it's much easier to change health insurance while your health is good. Keep your HSA administrator separate from your insurance provider to make that even easier.
Posted by Wiley Long at 09:23 AM | Comments (0)
March 24, 2011
Are Patients With Health Savings Accounts More Savvy?
The nonprofit Employee Benefit Research Institute recently released their survey that investigated a link between cost-conscious behaviors and those who make use of health savings accounts and health reimbursement arrangements. The results show that people with these plans are more likely to budget, compare prices and ask for generic drugs.
However, investigators also noted that people with HSA plans didn’t appear any more likely to talk to doctors about cost, request less expensive drugs or check quality ratings on doctors or hospitals. Nor was any relationship seen between health savings account balances and cost-conscious behavior.
The report's author and director of the institute’s health research and education program, Paul Fronstin, noted that, “It is expected that individuals who are given more control over funds allocated for health care services will become more cost-conscious, especially once they become more educated about the actual price of health services. However, no evidence was found to support this with respect to some of the measures used in this study of cost-conscious behavior.”
This online survey of a nationally-representative sample involved 4,508 adults between the ages of 21 and 64, who have private health insurance. The results also indicated that the number of people with health savings accounts grew to 5.7 million in 2010. That was an increase of 1.2 million since 2006. You can see whether an HSA or health reimbursement arrangement is right for you with the resources on our website.
Posted by Wiley Long at 11:38 AM | Comments (0)
March 20, 2011
Health Savings Accounts Are The New Retirement Accounts
Health savings accounts are becoming the IRA of choice with escalating health care costs. These special accounts work with high-deductible health insurance plans to let you save with tax-free interest to pay for health care and take tax deductions for medical expenses.
Health savings accounts keep the tax-free interest IRA benefit and add tax deductions for contributions to the health savings account (HSA).
If you don't need HSA funds for health care, you can save the money for when you retire. Funds in this type of savings account roll over year after year. Some financial experts recommend to contribute the maximum allowed to an HSA before starting an IRA or Roth because you can withdraw money tax-free from an HSA to pay for qualified health care. On the other hand, you will not be able to spend HSA funds on anything other than health care until you turn 65.
Health savings accounts have benefits long before you retirement, though. 1) You can save for health care throughout your working years to help if you are unemployed or working where no health plan is available. 2) The health insurance plans that allow to start an HSA have lower premiums than plans with lower deductibles. 3) You can also save by reducing your taxes by taking the tax deduction available when you fund an HSA. Our online resources explain the pros and cons of these accounts and the high-deductible health insurance plans that work with them.
Posted by Wiley Long at 09:48 AM | Comments (0)
March 17, 2011
Health Savings Accounts Continue To Grow In Popularity
Health Savings Accounts and Health Reimbursement Arrangements have become increasingly popular, according to a new Employee Benefit Research Institute (EBRI) report. There's been an increase both in the number of these HSA plans and the balances within the Health Savings Accounts.
In 2010, the EBRI reported 5.7 million Health Savings Accounts holding a combined total of $7.7 billion. In 2006, there was just $835 million held in 1.2 million Health Savings Accounts and balances only averaged $696.
To take advantage of a Health Savings Account (HSA), you must buy one of the high-deductible health insurance plans that are qualified to be combined with an HSA. This year, these high deductibles start at $1,200 for individual coverage and $2,400 for family coverage. The qualifying policies can have out-of-pocket limits up to $5,950 for indidivual plans and $11,900 for family coverage.
An HSA also offers tax advantages. You can contribute up to $3,050 to an individual HSA or up to $6,150 to a family plan and claim a tax deduction on federal taxes and almost all state taxes. Tax deductions are not based on your income and you don’t have to itemize deductions to take a deduction. Learn more about tax-free HSA withdrawals to cover a wide range of qualified health care right on our website.
Happy St. Patrick's Day to everyone!
Posted by Wiley Long at 06:15 PM | Comments (0)
March 12, 2011
Health Savings Accounts Make The Most Of Your Savings
Combining a Health Savings Account (HSA) with a high-deductible health insurance plan can help you get lower premiums, pay less in income tax and build your own medical retirement fund. A number of benefits are available through an HSA and that's why they are becoming such a hot commodity.
Health Savings Accounts present tax advantages by reducing your taxable income and allowing you to earn tax-free interest. You can only start an HSA after you buy one of the high-deductible health insurance plans that are qualified to work with an HSA.
An HSA can be used to pay for qualified health care that's not typically covered by traditional health plans. You're allowed to deposit tax-deductible contributions and withdraw funds to pay for co-pay charges, chiropractic care, dental services, health-related travel expenses and prescriptions. That can give you more flexibility in choosing health care options. You can also use your HSA to cover health care for a loved one.
Prevention is another way to cut your health care costs. Invest in staying healthy to reduce the health care you'll need today and during retirement. You'll benefit from fewer doctors visits and hospital stays. Find out more about how to set up an Health Savings Account right on our website.
Posted by Wiley Long at 11:16 AM | Comments (0)
March 07, 2011
Why The Rise In The Use Of Health Savings Accounts?
Growing from 1.2 million in 2006, the number of health savings accounts and health reimbursement arrangements had risen to 5.7 million by 2010, according to the nonprofit Employee Benefit Research Institute (EBRI).
The EBRI also reported that people who exercised, were not obese and did not smoke tended to have higher health savings account balances than people with less healthy behaviors. As expected, individuals who used cost or quality information maintained higher health savings account balances than those who did not use this information.
"In 2006, 15% of the population with a health savings accounts and health reimbursement arrangements had held an account for less than six months; 42% for six months to a year; and 30% for one to two years," according to the report. "By 2010, 8% had held them for less than six months; 19% for six months to a year; and 35% for one to two years."
We've put together a library of resources on our website to document why more people are investing in health savings accounts and health reimbursement arrangements.
You can visit us online at: http://www.health--savings--accounts.com
Posted by Wiley Long at 10:57 AM | Comments (0)
March 04, 2011
What Should You Do With Your Health Savings Account When You're Eligible For Medicare?
You do have certain choices. For example, my wife will be 65 this year, so she'll be eligible for Medicare a year earlier than I will be. We already try to contribute the maximum allowed to our health savings account (HSA) annually. In this situation, we needed to find out how much we could contribute in the year she turns 65 in June and how to use our HSA once she enrolls in Medicare.
According to Roy Ramthun, the president of HSA Consulting Services, when my wife becomes a Medicare beneficiary, she will no longer be allowed to contribute to an HSA. She'll have to prorate contributions for the six months she has an HSA plan before she enrolls in Medicare this year. The maximum HSA contribution is now $6,510 for family plans and $3,050 on individual coverage. If you're 55 or older, you can make an additional $1,000 contribution each year.
If my wife enrolls in Medicare when she turns 65 this June, she could contribute 5/12 of the $6,150 for family coverage ($2,562.50) plus 5/12 of a catch-up $1,000 contribution ($416.67). The IRS Instructions for Form 8889 for a worksheet can help you calculate how much you can contribution in these kinds of situations to your Health Savings Account.
Even though my wife can't continue to contribute to an HSA once she enrolls in Medicare, she's still allowed to withdraw HSA funds tax-free for qualified health care expenses, which includes co-pays, deductibles, dental care, prescribed drugs, vision care and a portion of long-term care premiums. That portion is based on age. My wife will also be allowed to use HSA money to pay Medicare-related premiums tax-free. That works for Medicare Part B premiums as well as for Medicare Advantage or Medigap plans.
Posted by Wiley Long at 07:01 AM | Comments (0)
March 01, 2011
HSA Bank Tops $1 Billion in Health Savings Account Deposits
With the popularity of health savings accounts skyrocketing, HSA Bank has passed the $1 billion milestone in Health Savings Account (HSA) deposits.
As a division of Webster Bank, HSA Bank has devoted all of its resources to the administration of health savings accounts since 1997. It has attracted both individuals and Fortune 500 companies.
In addition to providing health savings account services through HSA Bank, Webster Bank also owns the asset-based lending firm Webster Business Credit Corporation. The equipment finance firm Webster Capital Finance is also owned by Webster Bank.
It's the exclusive attention that has made HSA Bank one of the most experienced HSA administrators and most user friendly. HSA Bank has developed flexible programs, such as online access to accounts, for both employer and individual customers. The bank also provides support to its business partners.
Posted by Wiley Long at 05:23 AM | Comments (0)