Health Savings Accounts (HSAs)
HSA funds can pay for any “qualified medical expense,” even if the expense is not covered by the HDHP. For example, most health insurance does not cover the cost of over-the-counter medicines, but HSAs can. HSA rules state that If the money from the HSA is used for qualified medical expenses, then the money spent is tax-free.
For a definitive list of “qualified medical expenses”, please refer to the HSA Rules in IRS Publication 969 – available at http://www.irs.gov.
If the money is used for items other than qualified medical expenses, the expenditure will be taxed and, for individuals who are under age 65, subject to a 20% tax penalty.
According to HSA rules, any eligible individual can contribute to an HSA. For an employee’s HSA, the employee, the employee’s employer, or both may contribute to the employee’s HSA in the same year. For an HSA established by a self-employed (or unemployed) individual, the individual can contribute. Family members or any other person may also make contributions on behalf of an eligible individual.
Employees are embracing Health Savings Accounts (HSAs) at a very quick pace as they shift towards lower-premium High Deductible Health Plans (HDHPs). The flexibility of this Consumer Driven Account (CDA) makes it one of the most cost-effective ways to pay for qualified healthcare expenses and people are taking notice. Each year, HSAs are more prevalent in the healthcare and financial industry news as a great strategy to set money aside to pay for qualified expenses now and in retirement.
Employer HSA Features:
- Online management
- Efficient contributions
- Integrated enrollment
- Dedicated service
Your client’s employees receive a seamless HSA experience that allows them to take advantage of everything an HSA plan offers, including:
- Online access with real-time account information
- Options to submit claims online and pay providers directly
- Unlimited, free debit cards
- Online investment services
- Personalized customer service
- Interactive calculators and decision-support tools
- Featured partners with additional savings tools