What is an Health Savings Account (HSA)?
A Health Savings Account (HSA) is a tax-advantaged bank account that can be used to pay for medical, dental, vision and other qualified medical expenses.
Who is Eligible?
Anyone enrolled in a high deductible health plan, provided they are;
- Not covered under another health plan
- Not covered under Tricare
- Not another person’s tax dependent
- Not enrolled in Medicare (if over 65)
- Not enrolled in Medicaid
What is a High Deductible Health Plan (HDHP)?
A High Deductible Health Plan is a health insurance plan that has been qualified as an HSA compatible or eligible plan. HDHP’s typically share a few common characteristics such as;
- High Deductibles
- No or very few Co-pays, which typically means Doctor visits, Urgent Care, Emergency Room, & Prescriptions are covered after your annual deductible has been meet
For 2019, the IRS defines it as follows;
- Out-of-Pocket maximum of $6,750
- Minimum Deductible of $1,350
- Out-of-Pocket maximum of $13,500
- Minimum Deductible of $2,700
What are the benefits of an HSA?
1.Money goes in tax-free. Contributions are made on a pre-tax basis, and are also tax deductible.
2.Money comes out tax-free. Eligible healthcare purchases can be made tax-free. Purchases can be made directly from the HSA account, either by using a healthcare debit card (if included with your HSA), ACH, online bill-pay or check; or, you can pay out of pocket and reimburse yourself from your HSA.
3.Earn interest, tax-free. The interest on HSA funds grows on a tax-free basis.
4.Your HSA balance can be carried over year after year.
5.An HSA balance can be invested. Depending on your HSA, you may be eligible to invest your HSA in an interest-bearing account, a mutual fund, stocks or bonds.
6.You can use your HSA as retirement funds. After you turn 65, you can withdraw funds from your HSA for any reason without penalty.
What expenses are considered eligible?
Common eligible expenses include, but are not limited to;
- Health plan co-pays
- Dental care
- Artificial Teeth
- Contact Lenses
- Prescription Medicines
- Hearing Aids
- Psychiatric Care
- Pregnancy Test
- Weight Loss Programs
How can I contribute to my HSA?
- Payroll Deduction
- Direct Contribution
Who can contribute?
Who controls an HSA account?
Health Savings Accounts are owned & controlled by each individual employee, and any money deposited belongs to the employee immediately
What are the contribution limits for 2019?
- $3,500 for an individual
- $7,000 for a Family
- $1,000 Catch-up if age 55 or greater
Where can I set up an HSA account?
Most major financial institutions can offer HSAs, so you may be able to open an HSA through your bank. Make sure you understand what fees, if any, will be charged for maintenance of the account
Who do I contact to get started with an HSA plan?
Please reach out to me in any of the following ways that work best for you;
- Call or text me at 1-740-397-1234
- Email us at email@example.com
- Email me directly at firstname.lastname@example.org