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Health Savings Accounts Health savings accounts (HSAs) were previously known as medical savings accounts. While MSAs are still around in some form, it is no longer possible to enroll in them. This new incarnation opens up this option to more people and has more advantageous benefits. Basically, HSAs allow employees to put tax-free money into an account, which they can then use to pay for qualified medical expenses. Health Savings Accounts - The New MSAs While there are many similarities between the MSAs of the past and new health savings accounts, there are also some significant differences. Medical savings accounts were limited to employers who had 50 or fewer employees. Employers of any size can offer their employees the option of a health savings account. In order for a person to be eligible for an HSA, a high deductible health plan must cover that person. The minimum deductible required under an HDHP is $1,150 for singles and $2,300 for families in 2009 ($1,100 for singles and $2,200 for families in 2008). In addition to the tax benefits offered, plans such as HSAs, MSAs and flexible spending accounts give employees more control over how their health care dollars are spent. Employees can track what they are spending and see exactly what their health care is costing them. Also, these accounts cover expenses not normally covered under other insurance plans. |
Additional Topics Consumer-Directed Health Plans Consumer-Driven Health Accounts Dependent Care Flexible Spending Accounts Flexible Health Spending Accounts Flexible Medical Expense Accounts Health Care Flexible Spending Accounts Health Reimbursement Arrangements IRS Section 125 Cafeteria Plans Medical Expenses and Income Tax Plan for Medical that Health Insurance Doesn't Cover Save 25% to 40% on Health Expenses Save on Co-Pays and Over-the-Counter Medications Save on LASIK and Orthodontic Costs Section 125 Plan Administration |
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