Florida Health Savings Accounts are a new affordable option for those who are healthy and want to avoid high premiums. With an HSA, you pay for health care from a designated savings account under a plan that was instituted by the government. At the same time, you save for future contingencies, and these savings are tax-free. You do not pay tax on the interest the account accrues.
Unfortunately, not everyone can get an HSA. To be eligible, you must be covered by a health plan with a high deductible, sometimes known as catastrophic health coverage. These insurance plans typically are less expensive than a more traditional insurance plan, and they manage to affect this savings by setting the deductible rate high.
By not having to cover medical expenses until they get into the higher ranges, the insurance companies can afford to sell these policies at the lower premium rate.
You put the money into your HSA, and you control it once it’s there. You decide when to spend it and which medical costs to spend it on. You may prefer to meet some costs out of pocket and leave the money in your HSA for future contingencies.
You decide what to invest the money in, in order to make the principal grow so that you’ll have even more money in the bank to meet future medical needs. It’s your money. And unlike the premiums you pay into an insurance policy, you have control over the money in your HSA. There is no other person, or company, or other entity telling you what you must do, may do, or may not do, beyond the governmental restrictions on how much you may deposit per year (see below).
You can purchase a Health Savings Account through a Florida health insurance company. HSAs are also available through banks, credit unions, and certain other companies. As well, it is possible for an HSA to be set up by an employer, who then offers the plan to their workers who have high deductible policies through work.
The HSA itself does not cost anything. The HSA trustee or administering institution e.g. insurance agency or credit union, may charge a fee for their services, however.
The government sets caps on how much you may contribute in any given year. These vary from one year to the next. You may contribute in one lump sum or in stages throughout the year. Your contributions do not need to be of equal amounts: You can deposit $50 one month, nothing the next month, and $400 the following month. In addition to the government regulations, your HSA trustee may impose limits or requirements for deposits.
Your employer, who may have set up the HSA for you, may also contribute to your HSA if they wish to.
For healthy individuals who want to save money, Florida HSAs are a great insurance product.