Smart Benefits: HSAs Look Good as Obamacare Decision Looms

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Tuesday, May 08, 2012

Amy Gallagher, GoLocal Business/Health Expert

As the country stands still waiting for a Supreme Court decision on Obamacare, many consumers are taking matters into their own hands, seeking more affordable healthcare by enrolling in health savings accounts (HSAs). 

HSA Advantages

Giant banks like BankAmerica, Health Equity and Wells Fargo all reported record growth of HSAs in 2011.  Why?  HSAs deliver some tangible ways for consumers to save money on healthcare expenses, right now.

• With an HSA, consumers exchange lower monthly insurance premiums for higher deductibles.  In 2013, the minimum high deductible plan is $1,250 for an individual and $2,500 for families. 
• Preventive care is covered at 100%, making it easy for families to have their annual physicals, preventive screenings and immunizations.
• HSAs offer a “triple-tax” advantage: tax-free contributions, tax-free withdrawals for qualified medical expenses and tax-free interest on savings.

 

FSA Limitations Make HSAs Even More Appealing

Beginning in 2013, healthcare reform will place an annual limit of $2,500 on flexible spending accounts (FSAs), another consumer-friendly option to pay for qualified medical expenses.  Alternatively, in 2013, consumers can save up to $3,250 for individual plans or $6,450 for families – all tax-free – in an HSA.  The catch-up contribution will remain $1,000 for 2013.

Save Now for Later

With an HSA, consumers can take the difference they save on lower premiums and deposit it into their account, using it to pay for current qualified medical expenses. Or, they can roll the savings over year-to-year to pay for future healthcare, likely to be even more expensive.

With an HSA, flexibility and savings, are key – and the key to their success.

Amy Gallagher has over 19 years of healthcare industry experience.  As Vice President at Cornerstone Group, she advises large employers on long-term cost-containment strategies, consumer-driven solutions and results-driven wellness programs. Amy speaks regularly on a variety of healthcare-related topics, is a member of local organizations like the Rhode Island Business Group on Health, HRM-RI, SHRM, WELCOA, and the Rhode Island Business Healthcare Advisory Council, and participates in the Lieutenant Governor’s Health Benefits Exchange work group of the Health Care Reform Commission.

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