HSA Facts

HSA's (Health Savings Accounts) provide you with an alternative method to help pay for health care expenses and plan for retirement, providing you with more control over your health care dollars.

• 80% of purchasers have families with children.

• 70% of purchasers are over age 40.

• 45% of purchasers are from households with four or more people.

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HSA's are tax-deductible, interest-bearing accounts that permit unused funds to roll over from year to year, even if you change employment.  They are similar to IRA's.  Health care savings account's must be combined with a qualified HDHP. (High Deductible Healthcare Plan)  Contributions to your savings account may be made by employers, employees, or individuals.  You may contribute up to $2,850 for a single-person policy and $5,650 for a family policy in 2007.  Once the deductible is met, the remaining health expenses are paid according to the plan's benefits.  If you have a 100% co-insurance plan, all remaining expenses will be paid by the carrier.  If you have an 80/20 co-insurance plan, 80% of the remaining expenses will be paid by the carrier.  Any individual with a HDHP (High Deductible Healthcare Plan) may contribute to an HSA.  Individuals over age 65 who are not eligible for Medicare may also contribute to an HSA.  Individuals between the ages of 55 and 65 and those over 65 who are not eligible for Medicare may make additional "catch-up" contributions.

Distributions from your HSA are tax-free if they are used to pay for qualified medical expenses.  Distributions for any other purpose are taxable and subject to an additional 10% penalty.  Distributions may be made for qualified expenses, even those not covered by your health care plan - for example, dental expenses and chiropractic care.

Once you are 65 years old, the money may be used to pay for health expenses and certain insurance premiums such as Medicare Parts A and B, Medicare HMO, and your share of your retiree medical insurance.

Will an HSA plan work for you?  Call us for a free evaluation to find out! 

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*You can also find more valuable information about HSA's at the HSA Insider!