by mega » Fri Jan 25, 2008 05:27 pm
A Misinterpreted Benefit
Last month, I spent some time looking into health insurance options for my small group of employees and myself. It was an unsettling exercise as I reviewed the various plans and calculated the increase in premiums (which, according to Hewitt Associates, are set to rise an average of 8.7 percent this year).
Around the same time, I caught an episode of ABC''s "20/20" that profiled the success popular grocery chain Whole Foods has had with the health savings accounts (HSAs) they offer their employees. After watching the show, I decided to do a little more digging to see if an HSA might make sense here at FinishRich Media.
What I found is that there are a lot of misconceptions about HSAs, including that if you don''t use the entire balance of your HSA before the end of the year, you forfeit it. That''s not true -- with an HSA, there''s no "use it or lose it" rule.
What You Need to Know
Here are the top seven things I discovered about HSAs that might help you determine if this type of account is right for you:
1. HSAs are essentially tax-free medical savings accounts.
2. You need a high-deductible health plan to qualify.
3. You contribute to HSAs just like retirement accounts.
4. Eligible expenses go beyond those that count against your deductible.
5. HSAs offer real flexibility, and portability.
6. Once you hit 65, the money is all yours -- penalty free.
7. HSAs aren''t the same as HRAs or FSAs.
Article explores each of the above.
Last month, I spent some time looking into health insurance options for my small group of employees and myself. It was an unsettling exercise as I reviewed the various plans and calculated the increase in premiums (which, according to Hewitt Associates, are set to rise an average of 8.7 percent this year).
Around the same time, I caught an episode of ABC''s "20/20" that profiled the success popular grocery chain Whole Foods has had with the health savings accounts (HSAs) they offer their employees. After watching the show, I decided to do a little more digging to see if an HSA might make sense here at FinishRich Media.
What I found is that there are a lot of misconceptions about HSAs, including that if you don''t use the entire balance of your HSA before the end of the year, you forfeit it. That''s not true -- with an HSA, there''s no "use it or lose it" rule.
What You Need to Know
Here are the top seven things I discovered about HSAs that might help you determine if this type of account is right for you:
1. HSAs are essentially tax-free medical savings accounts.
2. You need a high-deductible health plan to qualify.
3. You contribute to HSAs just like retirement accounts.
4. Eligible expenses go beyond those that count against your deductible.
5. HSAs offer real flexibility, and portability.
6. Once you hit 65, the money is all yours -- penalty free.
7. HSAs aren''t the same as HRAs or FSAs.
Article explores each of the above.
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