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Today, employment no longer guarantees health insurance coverage,especially in small businesses. The National Coalition on Healthcare reportsthat one-third of firms in the U.S. (and almost two-thirds of smallbusinesses) did not offer coverage in 2006. Nearly 1.3 million full-timeworkers lost their health insurance the same year, bringing the total numberof uninsured workers in this country to 37.7 million.
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The good news for these workers and others, including those who areself-employed or retired, is that they now have more affordable options to getthe coverage they need. Many are choosing to purchase high-deductible healthplans with health savings account (HSAs), which have much lower premiums thantraditional health insurance and give people greater control over how theyspend their health care dollars.
"For families with about $1,500 in annual medical expenses, an HSA canoften save them more than $6,000 a year," said Scott Krienke, senior vicepresident, individual markets, for Assurant Health, a leading provider ofHSAs.
More than 6.1 million Americans have already opened HSA accounts. Inaddition to lower premium costs, there are several reasons for theirpopularity. First, they allow you to save money in a tax-free account, likean IRA, to pay for routine medical expenses. Your contributions (up to $5,800for families in 2008) are tax deductible and you pay no tax on withdrawals forqualified medical expenses.
Second, your HSA funds are completely portable and roll over from year toyear -- even if you change jobs, take a job that doesn't offer insurance,start your own business or retire. You can also pay for any qualified medicalprocedure without having to get it specifically approved, regardless of anypre-existing conditions. You can use your HSA account during retirement topay for health care, Medicare expenses and prescription drugs.
Could you benefit from an HSA? One way to find out is to go to the Website HSAInsights.com. This site was designed to help you understand thebasics of HSAs and to provide resources and tools for making smart choices.It even includes a calculator to estimate how much you can save with an HSAcompared to a traditional health plan and determine its potential future valuebased on your expected contributions and expenses.
SOURCE HSAInsights.com
