Chase Bank, the nation’s second largest bank and the top credit card issuer, recently reported a significant percentage increase in the number of customers establishing health savings accounts (HSAs) in 2009, as compared to previous years. These new clients range from individuals to small employers and even large corporations.
HSAs were made available through the Medicare Prescription Drug, Improvement, and Modernization Act of 2003. These tax-free savings accounts allow consumers to save and then apply money toward qualified medical and health expenses not covered by their health insurance deductible.
Anyone with a high deductible health insurance plan is eligible to open a health savings account in Texas. Though one account holder is needed for initial setup, the HSA funds can be used for any family member covered under the high deductible insurance plan. The HSA tax deduction is equal to the amount of money that is deposited into your Texas health savings account, and the U.S. Treasury allows individuals to contribute money to their HSA accounts even if deductions are not itemized.
According to the Internal Revenue Service, the annual contribution limit on deductions for health savings accounts in 2010 is $3,050 per calendar year for an eligible individual with self-only coverage. The limit is $6,150 for family coverage. A high deductible health plan is defined as having an annual deductible of at least $1,200 for self-only coverage or $2,400 for family coverage, and annual out-of-pocket expenses (e.g., deductibles, co-payments, etc.) up to $5,950 for self-only coverage or $11,900 for family coverage.
According to Blue Cross Blue Shield of Texas, HSA insurance plan members spent eight percent less than traditional insurance clients. Because HSA insurance plans are consumer-directed and managed, the individuals who subscribe to these plans are in control of how their money is spent. Consumers with HSAs tend to take a more active role in their health care, since the money they’re saving and spending is their own. Maximizing value can be achieved in health care only if the system is restructured to make the consumer the key decision maker.