Health Savings Accounts 

By now, you’ve probably heard something about Health Savings Accounts (HSAs). Picuture of a family With the cost of health insurance increasing at an alarming rate, consumers throughout the country are searching for lower-cost solutions. For many people, the best answer is an HSA and NNA’s member benefit program now includes access to this option. On this website, members will find the information they need to understand HSAs and help decide if the concept is right for them.

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HSAs are growing quickly... First introduced in 2004, HSAs have become one of the most popular options for lowering health insurance costs, especially among small businesses and the self-employed. By January 2015, America’s Health Insurance Plans (the insurance company trade association) reported a total of 19.7 million HSA customers nationwide, an increase of 2 million over the previous year.
HSA in a nutshell... So, in a nutshell, what is an HSA? At its core, the concept is quite simple. Anyone who takes out a “qualifying high deductible health insurance policy” can also open a special tax-deferred savings account dedicated to health care expenses. Because it does not pay for routine medical expenses, a high deductible policy typically costs 20% to 40% less than traditional policies while still providing full coverage for catastrophic accidents or illnesses. The companion health savings account is used to pay, on a pre-tax basis, regular medical expenses which do not exceed the deductible.
A medical IRA... HSAs have been called “Medical IRAs” by some proponents of the idea and it is easy to understand the basic concept by thinking of it that way. An HSA is treated, for tax purposes, much like an IRA:
  • the money you deposit in an HSA reduces your taxable income dollar-for-dollar;
  • interest earned by the HSA is not subject to current year taxation;
  • money paid out of the HSA for health care expenses is not taxed;
  • you can take money out for non-health care expenses but it becomes taxable income and is subject to a penalty.
Flexible Spending Accounts.. Another common comparison is to Flexible Spending Accounts (FSAs) which are a popular feature of many employer group benefit plans. “Use it or lose it” is how FSAs work. Any money left in your FSA account at year end is forfeited. Under an HSA, the opposite is true – any money left unspent remains in your account. In effect, HSAs are “use it or keep it”.
Pay yourself... “Paying yourself” is also a good way to think about HSAs. Instead of forking over high premiums to the insurance company for very comprehensive coverage, consider paying part of that premium to yourself. That’s exactly what you are doing when you buy a lower-cost high deductible policy and redirect the savings in to your own Health Savings Account.
Is an HSA for me? HSAs are not for everyone. You are probably a good candidate for an HSA, though, if you meet two tests:
  1. You are basically in good health, free of chronic conditions and generally only visit a doctor a few times a year for simple conditions like a cold, etc. and/or an annual physical, and 
  2. You have the financial ability and discipline to fund the savings account.
If you’re interested in knowing more, please explore this website thoroughly and then request a quote. Or, if you prefer to discuss the subject with a qualified advisor, call 1-877-673-9797 between 8:30 AM and 5 PM (Eastern Time).
Qualified Policy Definition and Allowable Contributions The deductible and out-of- pocket maximum qualifications necessary to qualify a High Deductible Health Policy as eligible for an HSA, along with the contribution maximums are shown in the table below:
HDHP Minimum Deductible Amount 2015 2016 2017
Individual $ 1,300$ 1,300$ 1,300
Family $ 2,600$ 2,600$ 2,600
HDHP Maximum Out-of-Pocket Amount 2015 20162017
Individual $ 6,450 $ 6,550 $ 6,550
Family $ 12,900 $ 13,100$ 13,100
HSA Maximum Contribution Amount 2015 20162017
Individual $ 3,350 $ 3,350$ 3,400
Family $ 6,550 $ 6,750$ 6,750
Catch-Up Contributions
(age 55 or older)
2015 2016 2017
  $ 1,000 $ 1,000 $ 1,000