Health Savings Accounts are Easy To Understand

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Health Savings Accounts are simple and easy to understand           


A Health Savings Account Health Savings Account is a tax-favored savings account combined with a qualifying high-deductible health insurance plan.  By allowing you to deposit tax-deductible funds into a health savings account that you can use to cover medical costs, Health Savings Accounts enable you to take control of your own health care decisions.  One of the key aspects to health savings accounts is a system that is responsive primarily to individual consumers, rather than to third-party payers. This concept is known as consumer driven health care.

First, you must have a high-deductible health insurance plan that qualifies to be partnered with a Health Savings Account.  These plans are available through various insurance companies, depending upon what part of the country you live.  The plans are all similar in the fact that they have deductibles between $1,100 and $5,600 for singles, and between $2,200 and $11,200 for families.

Once your insurance policy has become effective, you may begin to fund your Health Savings Account.

Health Savings Accounts allow you to legally avoid federal income tax by depositing up to $2,900 for singles or $5,800 for families, into your Health Savings Account.  Whatever you deposit into your account up to April 15, 2009 is an "above the line" tax deduction for your 2008 taxes, meaning you get a federal income tax deduction for money you put in even if you take the standard deduction and don't itemize deductions.  If your employer makes a Health Savings Account contribution for you, it is "excluded" from income, and not subject to any income tax or FICA.  Either way, this will immediately reduce your federal income tax due for the year.  Most states also allow you to take a state income tax deduction for HSA contributions.  To see options on Health Savings Accounts please visit



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Shaun Wren

There is a huge tax benefit with the HSA plans. But only if you use it. If you buy a lot of  over the counter meds, this could be very good for you.

Jun 24, 2008 10:21 PM #1
Mona Lori

To keep my health care costs down, I have high-deductible health plan, along with a HSA.  As a result, I have reduced my monthly premiums by thousands of dollars.  I also spend wisely on health care services to make the most out of my health care dollars and I am always looking for ways to find cost effective treatment options for routine care like MRIs, x-rays, vaccinations, lab tests, vision and dental services.  Unfortunately, the industry lacks meaningful tools to help consumers comparison shop for health care services and find the best value.   To fill this void I created a community website consumers can use to compare costs and find out what other consumers paid for similar services.  The website collects prices from consumers, providers, Government CMS Medicare data, and links to public websites that disclose prices.  Visit and I welcome all your comments.

Mona Lori, founder,


Jun 26, 2008 01:55 AM #2
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