Friday, December 10, 2004
New guide to HSAs released
[Dan Perrin, "HSA Road Rules for Consumers, Employers, Insurers, Banks, Credit Unions and Administrators," The HSA Coalition, 7 December 2004.]
Offering an excellent overview of all of the ins and outs of Health Savings Accounts, this new publication from The HSA Coalition is a handy tool. These "Universal Principles," for instance, are just the tip of the iceberg:
Universal HSA Principles
1. You must have an HSA qualified high deductible health plan to open or contribute to a Health Savings Account.
2. Switching to a high deductible health plan from a traditional low deductible health plan will cut the cost of your health plan substantially. You deposit the savings gained into your Health Savings Account. The whole point of a health savings account is to allow you to use that money on a tax-free basis to pay for your health expenses below your new, higher deductible.
3. The money in your Health Savings Account is your own. This means your employer cannot tell you what to do with your own money or restrict what you can spend it on. Since it is your money, it goes with you when you change jobs.
4. You are in charge of your Health Savings Account funds, making you and your doctor the decision makers, not some third-party. Spending your own money also means that you will/should ask about the cost of health care expenditures, which will bring marketplace competition to the world of health care.
5. You decide whether to spend from the account for your medical expenses and how much to spend, or whether to spend out-of-pocket and to save the HSA money for the future.
6. You decide which company will hold the account, and what type of investments you make with your account. Any investment allowed for IRAs is allowed for HSAs.
7. IRS Publication 502 provides a list of allowable expenditures from your Health Savings Account.
[Dan Perrin, "HSA Road Rules for Consumers, Employers, Insurers, Banks, Credit Unions and Administrators," The HSA Coalition, 7 December 2004.]
Offering an excellent overview of all of the ins and outs of Health Savings Accounts, this new publication from The HSA Coalition is a handy tool. These "Universal Principles," for instance, are just the tip of the iceberg:
Universal HSA Principles
1. You must have an HSA qualified high deductible health plan to open or contribute to a Health Savings Account.
2. Switching to a high deductible health plan from a traditional low deductible health plan will cut the cost of your health plan substantially. You deposit the savings gained into your Health Savings Account. The whole point of a health savings account is to allow you to use that money on a tax-free basis to pay for your health expenses below your new, higher deductible.
3. The money in your Health Savings Account is your own. This means your employer cannot tell you what to do with your own money or restrict what you can spend it on. Since it is your money, it goes with you when you change jobs.
4. You are in charge of your Health Savings Account funds, making you and your doctor the decision makers, not some third-party. Spending your own money also means that you will/should ask about the cost of health care expenditures, which will bring marketplace competition to the world of health care.
5. You decide whether to spend from the account for your medical expenses and how much to spend, or whether to spend out-of-pocket and to save the HSA money for the future.
6. You decide which company will hold the account, and what type of investments you make with your account. Any investment allowed for IRAs is allowed for HSAs.
7. IRS Publication 502 provides a list of allowable expenditures from your Health Savings Account.
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