Health Savings Accounts
A Health Savings Account allows individuals to pay for current health expenses and save for future qualified medical and retiree health expenses on a tax free basis. Consumers can sign up for HSAs with providers which will generally be insurance companies and banks. Employers are likely to set up plans for employees as well in which case the employer will generally be arranging the HSA for the employee. To be eligible for a Health Savings Account, an individual must be covered by a High Deductible Health Plan (HDHP), must not be covered by other health insurance (does not apply to specific injury insurance and accident, disability, dental care, vision care, long-term care), is not eligible for Medicare, and can’t be claimed as a dependent on someone else’s tax return. A HDHP is a health insurance plan with minimum deductible of $1,150 (self-only coverage) or $2,300 (family coverage). The annual out-of-pocket (including deductibles and co-pays) cannot exceed $5,800 (self-only coverage) or $11,600 (family coverage). HDHPs can have first dollar coverage (no deductible) for preventive care and higher out-of-pocket (copays & coinsurance) for non-network services.
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Last updated: 02/06/2009
