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What are health savings accounts?
By Tim Young, Retail PharmacyA health savings account is an alternative to traditional health insurance. It is a different way to pay for your healthcare. Health savings accounts are used with high deductible health insurance plans.
The money you save on higher deductible health plans is deposited into your health savings account. This pre-tax money. These savings are used to pay for expenses until your deductible is met. After the deductible is met, your health insurance pays for covered costs. Certain over-the-counter items are also covered by health savings accounts. Our new point of sale cash register will enable you to purchase these items and let your health savings account pay for them.
The money in your health savings account is owned and controlled by you. You decide how to spend the money. The theory is you will shop around for the best price and only use healthcare when it is really needed. Employers like this feature. They feel if you are spending your money, you will spend less.
In 2009, the maximum contribution is $300 for individuals and $5950 for families. Any money not spent after a year is rolled over into an IRA and begins to draw interest for you.
