Health Savings Accounts are medical savings accounts that receive tax protection in the United States. Monies that are put into these accounts are exempt from federal taxes at the time of deposit. The savings can continue to accumulate from one calendar year to the next. These Health Savings Accounts are geared towards people that have high deductible health premiums. Taxpayers can use the funds in their Health Savings Accounts to pay for authorized health care expenses. Owners of the Health Savings Accounts are penalized for using the monies for non health related expenses. However, if the person is retirement age, no penalty is charged. This is similar to IRA funds.
Health Savings Accounts are intended to encourage saving for health care expenses in the future. Furthermore, these accounts are a major component of consumer driven health care. Advocates for consumer driven health care believe that these Health Savings Accounts puts the consumer in more control of their health. In addition, this control can help decrease the costs of health care in the market place. Also, Health Savings Accounts are thought to encourage increased efficiency in the health care system. Consumers are not limited by a health care gate keeper deciding what medical care they can have access to. Consumers can take control of their own health. The purchase of any health insurance policy is a huge decision; iHealthCoalition.org recommends receiving at least three quotes before committing to a health insurance policy.
Individuals have several options to choose from when selecting a health insurance policy. One type, HMO, is also referred to as a Health Maintenance Organization. HMO’s are a very cost effective plan. These plans offer complete and comprehensive medical coverage for the consumer. The cost savings of this type of health insurance is derived from the network of coverage created. Networks are usually composed of doctors, clinics, hospitals, and specialists. These networks offer convenient access to affordable health care when the patient needs the coverage.
Moreover, the PPO, Preferred Provider Organization, is another health insurance with great benefits. The consumer is not limited to a certain network of providers. The PPO plan provides access to any medical provider. In addition, these plans offer great flexibility, cost effectiveness, and complete coverage.
Health Savings Accounts contain two main parts. The two main parts are as follows: high deductible plan and health savings account. The high deductible plan covers catastrophic medical events and requires a lower monthly premium. The Fee for Service plan is reimbursement for medical expenses. The consumer pays for the services up front and is later reimbursed for these services.
Premiums are paid monthly to keep the health coverage policy in force, while the deductible is the amount the consumer must pay before the coverage kicks in. The co-payment is usually paid at the time of service. This is the portion the patient is responsible for.
Consumers must carefully examine their health care needs. Some people require much medical care and others do not. Your medical health will determine which plan will work best for your family. Finally, a consumer must look at the big health care picture. It is important to plan for future care before problems occur.