Health Insurance

HEALTH SAVINGS ACCOUNTS

(formally known as Medical Savings Accounts)

If you are paying cash for chiropractic, acupuncture, dental, vision care, and prescriptions you may want to consider establishing a Health Savings Account.

What is a Health Savings Account?

It is a tax-exempt trust or custodial account managed by selected banks. Funds are used to pay for qualified medical expenses and selected over-the-counter drugs and medical products. They were created by the Federal Government and are designed to help individuals save for today's and tomorrow's medical expenses on a tax-free basis.

Who is eligible?

Individuals or families with a qualified high deductible health insurance plan. Individual and small group employer plans are available.

What is a qualified high deductible plan?

A qualified plan for 2004 is 1) HSA compatible; 2) must have at least a $1000 deductible for a single and $2000 for a family; and 3) can provide for first dollar coverage of preventative care.

What are qualified medical expenses?

Non-reimbursed medical expenses as defined in Section 213(d) of the Internal Revenue Code, except (in general) for health insurance premiums. (e.g. amounts for doctor’s fees, prescription medicine, over- the-counter medications, chiropractic, acupuncture, vision and dental exams, vision frames and lenses, physical therapy, and massage therapy as deemed medically necessary.)

Can funds be used to pay for health insurance premiums?

Only while receiving unemployment, COBRA continuing benefits, or for age 65 and older any health insurance premium except Medicare Supplementals.

Can funds be used to pay for Long Term Care coverage?

Yes, premiums for long-term care insurance are reimbursable. Also any deductible or out of pocket medical expense not covered by the long-term care plan.

How do I access these funds for payment?

Via debit card, check or ATM.

Who can contribute to the account?

Either the account holder, the employer or both.

Will I lose the money if I don’t spend it by the end of the year?

No.

Are there any monthly fees?

Yes, some banks may charge a minimum $2.25 per month, no charge for a debit card point-of-sale transaction with signature, and $1.50 per ATM withdrawal.

Here are a few programs to visit www.HSABank.com, Chase Health Savings Account via Blue Cross, Wells Fargo Health Savings Account via Blue Shield, Aetna HealthFund HSA.

Contact us today for a free, no obligation, discussion regarding your needs. Contact Us >>

Source: HSABank, Howards Grove, WI; AAHP-HIAA 8 Dec 2003 Comparison of Tax- Advantaged Health Care Spending Accounts