Major Reform for
You and Your Loved Ones!
The State of the
Union address from President Bush brought the concept of Health Savings
Accounts out into the open for all to see. This huge reform is long
overdue and a great solution to health insurance plans for many
Americans.
A Health Savings
Account (HSA) coupled with a HSA-qualified low cost High Deductible
Health Plan (HDHP) takes the bite out of monthly health care premiums. A
Health Savings Account also provides a powerful savings component as
well.
Let's look at the details:
Health Savings
Accounts were passed by Congress in 2003. It has taken a while for the
word to get out.
Health Savings
Accounts are tax-free savings accounts: they need to be coupled with a
HSA-qualified High Deductible Health Plan which covers catastrophic
medical expense so HSA + HDHP are required by the IRS to be tax-free.
Families can put
as much as $5,650 or individuals $2,850 annually into these Health
Savings Accounts. (These are 2007 numbers.) This money can then be used
to cover qualified medical expenses like doctor visits, dentist visits,
routine checkups, etc.
The expensive Low
Deductible/Co-pay Health Plan has no savings plan nor does it cover
additional eligible medical expense procedures that are covered under a
Health Savings Accounts and HSA-qualified High Deductible Health Plans.
The exciting thing
about HSA accounts…besides the tax-free part…is that you can carry over
unspent monies from year to year. It doesn’t matter where you work or
for whom you work! It’s portable no matter what!
Health Savings
Accounts give control over how much you spend and where. The
possibilities are eye-opening! You’re not tied to any plan's particular
doctors or medical groups. You are free to choose the providers you want
and in what ever state, county or country you want!
Health savings accounts when set up properly can save you lots of money
and allow you total control and flexibility. This is what everyone
wants.
The savings aspect:
Having a
traditional IRA or a 401(k) gives you a deduction for all contributions
made yearly, but after age 65 all distributions (Roth IRA's don't apply)
are taxed at both the federal and state level, including capital gains.
Health Savings
Accounts give the same benefits as IRA's and 401(k)'s.
The major
difference is the money withdrawn for qualified medical expenses is
never taxed!
Health Savings Accounts have no age restriction on when you may withdraw
the funds like other IRA’s and 401(k)’s do.
Retirement Bonus:
Health Savings Accounts are able to be
withdrawn after age 65 for any purpose without penalty. You still pay
income taxes if used for anything other than eligible medical expenses.
Self-Employed Bonus:
Knowing that the self-employed can write
off 100% of health care premiums makes the financial subsidy a great
benefit.
The payments of premiums come out of your
business and savings occurs from much lower premiums (up to 56%) and in
the tax-free contributions to your Health Savings Account.
Security and Safety Bonus:
Should the occurrence of sickness or
major injury occur you will have the ability to pay for your care or for
a spouse’s care. The major illness or injury won't be a family financial
disaster as it so often is these days.
More than 1 million Americans insured,
underinsured or non-insured end up in medical bankruptcy each year.
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Don't let this happen to you!
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Health Savings Accounts are a major
reform long overdue and finally here!
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Make sure you take advantage and tell
a close friend!
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