What Our Clients
Say
|
"I can in very good conscience recommend the service Compare-Health-Quotes.com has to offer… Compare-Health-Quotes.com
was easy to find and followed through by leading me thru the entire "shopping "
process. Not only did Compare-Health-Quotes.com save me valuable time, but enabled me to make an
informed choice."
Jenna Maus And Diane Maus
"My Compare-Health-Quotes.com agent responded within a day in regards to my health insurance needs.
I needed a good plan at a reasonable price. My agent explained my options in detail
and signed me up with a great plan. I now have lower deductables than my parents
plan and a decent monthly payment. I highly recommend Compare-Health-Quotes.com for all your insurance
needs."
James D. Sanders
|
|
|
News
|
How Changes in Health Savings Accounts Impact You
Clelland Green
2007-08-07
|
|
There have been some fairly significant changes in health insurance recently, specifically
in the area of health savings accounts (HSA's).
At a high level, more benefits are
being passed on to you. Last December, Congress passed some new changes that effected
many people as of January 1st of 2007. This demonstrates significant progress considering
that HSA's were started as recently as 2003.
|
|
Health savings accounts can be thought of as attachments to health insurance plans that have a high deductible or HDHP (High Deductible Health Plan). They allow for
the payment of current health expenses while saving for future qualified medical
and retiree health expenses. In order for a particular health plan to qualify as
an HDHP in 2007, it must have a deductible amount between $1,100 to $5,500 for singles
and between $2,200 to $11,000 for families.
|
|
You must be covered by a High Deductible Health Plan to be able to take advantage
of HSAs. An HDHP generally costs less than what traditional health care coverage
costs, allowing the difference to be put into the Health Savings Account.
|
|
Other features of health savings accounts that enable them to attract those looking
to be able to combine savings with health insurance are:
- Amounts used for medical purposes are tax-free
- Deposits are tax deductible
- Money stays in account and builds from year to year while accumulating interest
- Money remains under your control and you decide what types of investments to make
with the money in the account in order to make it grow.
|
|
Changes have recently occurred to make all of these great features even better.
Here are a few examples of the changes and how they can benefit you.
|
|
1.Maximum Deposit |
|
In the past, there was a limit on the amount that you could deposit into the account,
which was the amount of your deductible on your health insurance policy. You are
no longer limited by the deductible and can deposit a higher amount into your savings
to be able to earn a greater interest. In 2007, you can deposit an additional $800.
In 2008, this extra amount will be raised to $900. For example, if your deductible
is $2,000 as a single person, you can deposit up to the maximum deductible of $2,800.
If you are 55 or older, you can deposit an even greater amount.
|
|
2.Take Advantage Of Full Year Deposits Even With Partial Year Enrollment |
|
Even if you now enroll in September, you can still take advantage of a full year's
deposit. You are not limited now by how much you can deposit because it is not placed
on a monthly basis. Previously, you were allowed to deposit 1/12 of the total amount
for each month that you were enrolled. This stipulation has been removed but you
still must meet the qualification of a testing period, which means that you must
still be enrolled at the end of the 12th month from the time you enroll.
|
|
3.Transfer of Funds |
|
If you already have a Health Flexible Savings Account (FSA), Medical Savings Account
(MSA) or a Health Reimbursement Account (HRA), then you are permitted to make a
transfer from one of those accounts to your HSA. Please note that you can only do
this once in your lifetime from each type of account. Also, you cannot make a transfer
out of an HSA to any other savings plan. The limit for this transfer is $2,000.
The eligibility for this type of transfer requires that you are no longer eligible
for medical care under that plan.
All transfers must be made by January 1, 2012.
|
|
In addition to being able to make the transfers described above, you can also make
non tax-deductible transfers from an IRA. The only limit is the deductible amount
that is on your health insurance policy. There is also a one transfer per policy
lifetime with one exception; If you make your first transfer as a single person,
you can make another transfer if you become married that same year. The total amount
you can contribute cannot be greater than the deductible amount on your policy.
Please note that in this case, transfers can also be made from one HSA to another.
|
|
4. Employees With FSA’s Can Make Contributions To An HSA In Spite Of Grace Period
|
|
Under the old way of doing things, if you currently were a member of an FSA plan,
then you could not either start an HSA or contribute to one until the first day
of the first month after the grace period of the FSA expires. Now, you can make
deposits into the account in spite of having an FSA, but you must deposit all of
the balance into the HSA. Another stipulation is that you need to have less money
in your FSA account than what you had as of September 21, 2006 in order to qualify.
If this is not the case, then you still must wait until the end of the grace period.
|
|
In conclusion, each of these new changes in the management of HSA’s allows for greater
flexibility for you. These policies have become more consumer friendly than ever
before and you can expect this trend to continue in the future. If you do not currently
have a health savings account, it is time for you get your own to combine your needs
of lower cost healthcare and a savings for retirement. If you’re not sure where
to start, find a trusted health insurance advisor, like one from Compare-Health-Quotes.com,
to help you determine the best options for your needs and budget.
|
|
|
|
|
|
|
|