The HSA... Getting Past the Spin

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Article Title:

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The HSA... Getting Past the Spin

Article Description:

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An HSA, or Health Savings Account, is an alternative to

traditional health insurance coverage. With most Americans

seeking affordable health insurance, Health Savings Accounts

are being touted as an excellent option for those who want

more control over their health care expenses.

Additional Article Information:

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708 Words; formatted to 65 Characters per Line

Distribution Date and Time: Wed Mar 8 23:02:03 EST 2006

Written By: Shaughnessy

Copyright: 2006

Contact Email: mailto:erin@...

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The HSA... Getting Past the Spin

Copyright © 2006 Shaughnessy

Fast Health Insurance

http://www.fast-health-insurance.com/

An HSA, or Health Savings Account, is an alternative to

traditional health insurance coverage. With most Americans

seeking <a href= " http://www.fast-health-insurance.com/ " >affordable health

insurance</a>, Health Savings Accounts

are being touted as an excellent option for those who want more

control over their health care expenses.

Those interested in establishing Health Savings Accounts have a

number of issues to address, the first being eligibility. In

order to set up such an account, one must also purchase a High

Deductible Health Plan, or HDHP. High Deductible Health Plans

are often referred to as catastrophic plans. While the insurance

premiums are low, as opposed to comprehensive health plans, high

deductible plans will not usually pay for the first several

thousand dollars of health care expenses. Before considering a

Health Savings Account, you should determine whether or not you

can afford the High Deductible Health Plan. If you decide to get

an HDHP, the amount of your deductible is extremely important

because it will determine the amount of money you are permitted

to deposit in your HSA. For example, if your HDHP deductible is

$1,000, you will not be able to contribute more than $1,000 to

your Health Savings Account in a given year. As of 2006, the

minimum deductible of your High Deductible Health Plan must be

$1,050 for individual coverage, and $2,100 for family coverage.

Seniors enrolled in Medicare are not eligible for Health Savings

Accounts. If you are a Veteran, and have received any health

benefits from the Veterans Administration within the past three

months, you are not eligible for an HSA. If you are an active-

duty member of the military, and have Tricare coverage, you are

not eligible to establish an HSA. If your spouse has a Flexible

Spending Arrangement (FSA) or a Health Reimbursement Account

(HRA), you cannot set up a Health Savings Account if your

spouse’s plan can pay for any of your health care expenses before

your High Deductible Health Plan deductible is met. You and your

spouse cannot establish a joint HSA. You cannot set up an HSA on

behalf of your child. If you have any health insurance, other

than the required High Deductible Health Plan, you are not

eligible to establish a Health Savings Account.

Even if none of the eligibility restrictions apply to you, there

are additional issues to consider before deciding to establish a

Health Savings Account. Managing an HSA is not an easy task.

You, the consumer, are totally responsible for the management of

your account. Should you spend all of the money in your savings

account, you will be responsible for providing all necessary

receipts and paperwork to your insurance provider in order to

prove that you have met your deductible. Additionally, the

consumer is responsible for researching and deciding on quality

health care services. Because Health Savings Accounts are

consumer-driven, it is up to the individual to decide which

medical expenses are necessary. On the surface, this sounds like

a good thing. We all want maximum control over our health care

spending. The drawback is that you may choose a superficial test

($500) over a more advanced test ($1,000) to save money. As a

result, you may sacrifice your health to save your money. With

comprehensive, or traditional, health insurance coverage, you

would not generally have to face such a decision.

Supporters of Health Savings Accounts have concentrated on a few

key advantages. The most frequently cited advantage is that HSAs

are tax-free. This is true; Health Savings Accounts are tax-free

when used for qualified medical expenses. Which products and

services are considered qualified medical expenses? That is the

sole responsibility of the consumer to determine.

Senate Republicans have used the increasing number of Americans

establishing Health Savings Accounts as an argument for their

legitimacy. While over one million Americans are currently

receiving health care through HSA-eligible health insurance

plans, this does not speak to whether such plans are a good

choice. While many Americans are enrolled in plans that are

compatible with Health Savings Accounts, supporters of such plans

do not offer any information regarding the level of satisfaction

experienced by HSA users.

If you are considering a Health Savings Account, it is extremely

important that you thoroughly research your options in the

interest of making an informed decision.

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Shaughnessy is a free lance writer of political and

consumer advocacy articles for online publications, and

is a frequent contributor to <a

href= " http://www.fast-health-insurance.com/ " >Fast Health Insurance</a> at:

http://www.fast-health-insurance.com/