Despite legal and political challenges, the Affordable Care Act (ACA) has remained in place and is no longer under threat of being replaced.
Through the use of subsidies and extended Medicaid coverage, the ACA has facilitated access to health care for as many as 35 million Americans.
However, millions remain uninsured due to costs or other factors. As medical costs continue to increase, ACA-compliant plans could see a rate hike. Plus, the extended eligibility for subsidies passed as part of the American Rescue Plan was a temporary measure that will come to an end. Maintaining coverage could also be a challenge for the growing number of employees who decide to seek new job opportunities.
How do Texas Health Savings Accounts work?
Exploring alternatives makes sense with the possibility of premium hikes and other challenges to access coverage. One of the options to consider is a Texas Health Savings Account (HSA). Taking action and obtaining an HSA is an excellent option, especially considering the uncertain future of health care costs. Whether or not a rate hike happens for ACA health plans, a health savings account is a smart move now.
An HSA is a smart way to control your medical costs. Texas Health Savings Accounts work like IRAs, in which you contribute funds to a tax-free savings account. You can then use these funds toward qualifying medical expenses, including prescriptions, doctor visits, and preventive care.
In addition to helping you control your medical costs, the tax-free nature of HSAs means you’ll owe the government fewer tax dollars at the end of the year. And the savings account can accrue interest, netting you investment income over the years. To qualify for a Texas Health Savings Account, you simply need to set up a high-deductible health insurance plan.
Texas HSA rules
According to the IRS, depending on whether you have an individual or family account, a qualifying high-deductible health insurance plan has a deductible of $1,400 or $2,800 in 2022. For individuals, out-of-pocket expenses can’t be more than $7,050, and for families, they can’t exceed $14,100. Note that these limits don’t include out-of-network services.
Texas Health Savings Accounts also have a maximum annual contribution limit. For 2022, you can contribute up to $3,650 for an individual account and $7,300 for a family account. If you’re over 55, you might qualify for an additional $1,000 catch-up contribution.
Why choose a Texas HSA?
With a high-deductible plan in place, you’re covered in case of emergencies, and your HSA will go toward everyday medical expenses. Should you remain healthy, that HSA acts just like a savings account. Also, unlike a flexible spending account, it rolls over every year, so you’ll never lose any of your hard-earned money.
There are plenty of options for securing Texas health insurance, but none are as dynamic as the health savings account. The combination of monetary savings with personal control over expenses is a powerful force. It may be the best way to obtain and maintain an effective health insurance plan in these uncertain times. Contact Custom Health Plans today to help you choose the right plan for you.