HSA – It May Be Time!
Many of us are struggling with what type of health plan we should have and whether we can afford it. We know we need health coverage yet know that these premiums are a significant chuck of change. Many of us have grown up with copayments and we love going to the pharmacy and paying just $30 dollars for an Rx. However, as you consider what you should purchase for health coverage going forward we recommend that you look a Health Savings Account combined with a High Deductible Health Plan. Yes, we know PPOs with co-pays are what you like but with higher premiums this could be the difference of having health insurance or not! When you add the monthly premiums to your annual out of pocket maximum with a PPO or POS Vs an HSA, you will find that your cost is lower when you purchase the High Deductible Plan! If you fund your Health Savings Account, you can pay for most of the routine care, colds, and ear aches and still have money for larger expenses like the deductible. Contact Us for quotes for High Deductible HealthВ Plans? To learn more check out the great resources available at www.HSACENTER.COM. The site has won the World Wide Web Health Award for excellence in Web-based consumer health content and will be a great resource to you. 2011 HSA Contribution Limits, Deductibles, and Out-of-Pocket Expenses 2011 offers individuals and families additional opportunities to save for current and future health care with a health savings account. Note: There are no changes in contribution limits in 2011 from 2010.
| Minimum Deductible | Maximum Out-of-Pocket | Contribution Limit | 55+ Contribution | |
| Single | $1,200 | $5,950 | $3,050 | $1,000 |
| Family | $2,400 | $11,900 | $6,150 | $1,000 |
HSA holders can choose to save up to $3,050 for an individual and $6,150 for a family (HSA holders 55 and older get to save an extra $1,000 which means $4,050 for an individual and $7,150 for a family) – and these contributions are 100% tax deductible from gross income.
- Minimum annual deductibles are $1,200 for self-only coverage or $2,400 for family coverage.
- Annual out-of-pocket expenses (deductibles, co-payments and other amounts, but not premiums) cannot exceed $5,950 for self-only coverage and $11,900 for family coverage.
How do HSAs compare to FSAs and HRAs? Health Savings Accounts
- Financed with employee pre-tax dollars and/or employer contributions
- Distributions for qualified medical expenses are tax free (employees required to substantiate)
- Account balance belongs to employee and rolls-over from year to year
- Amount withdrawn after age 65 taxable as ordinary income
Flexible Spending Accounts
- Financed with employee pre-tax dollars
- Distributions for qualified medical expenses are tax free (compliance determined at time of payment)
- Account balance does not roll from year to year; use it or lose it
Healthcare Reimbursement Accounts
- Financed with employee pre-tax dollars and/or employer contributions
- Distributions for qualified medical expenses are tax free (compliance determined at time of payment)
- Unused funds may be carried to future years
