After reading a recent article in the NY Times regarding staying healthy in a poor economy and all the talk that generally surrounds us on food, cost of living, gym memberships, etc., I thought it was good timing to bring up the popular topic of health benefits. I mean, the candidates are debating our astronomical cost of healthcare so let’s briefly touch on what government resources can help.
Whether you are a small or home business owner or an employee of a small business, Health Savings Accounts (HSAs) are an important part of the portfolio of health care options that are available.
Background for Small Business Owners
HSAs were created in Medicare legislation signed into law by President Bush on December 8, 2003. HSA plans are inexpensive health insurance plans that don’t pay for deductibles but will generally cover you after that. HSA plans are available to help you pay for the expenses your plan does not cover. Small business owners should check with their insurance carriers to tell you in writing whether your policy is HSA-eligible. There is a checklist for small business owners available from the SBA to give you more information.
HSAs – What are they?
A Health Savings Account (HSA) is a tax preferred account owned by an individual used to pay for current and future medical expenses. They are funded by tax deductible individual contributions and employers can also contribute to employees’ HSAs. Here’s an Online Briefing on HSAs that provides self-paced training.
Qualifying for HSAs
To be eligible and qualify for an HSA, you must meet the following requirements:
- You need to be covered by an HSA eligible health plan with a deductible of at least $1,100 for individual coverage or $2,200 family coverage for 2008, and $1,150 and $2,300 for 2009.
- You cannot have any other health coverage, except what is permitted under Other Health Coverage
- You cannot be enrolled in Medicare
- You cannot be claimed as a dependent on someone else’s tax return
For additional information IRS Publication 969 details qualifications and more for health savings accounts and other tax-favored health plans. Also check out this fact sheet.
Resources
HSA Finder – Independent information source for Health Savings Accounts
HSA Insider – Q&A on HSAs
Business.gov – Workplace Health information
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