What Will My Employees Be Able to Use Their HSAs For?

The idea behind the HSA Account is pretty simple: If consumers have to pay more of their own medical expenses out-of-pocket, they’ll make more cost-effective choices. The hope is:

1. Health Savings Accounts might be able to put the lid on healthcare costs that are spiraling out of control.
2. Health Savings Account will protect us from the dangers of catastrophic medical problems.

How Do My Employees Qualify for an HSA?

To qualify, your employees will have to be under the age of 65 (and therefore not yet eligible for Medicare Benefits) and participating in a high deductible health insurance plan—meaning an insurance policy with a minimum deductible of $1,000.00 for singles, and $2,000.00 for families.

How Do My Employees Benefit from an HSA?

Benefit-wise, try to think of HSAs as a kind of super-charged IRA for healthcare. Here’s an up close look at what your employees will be able to use them for:

Pay for a long-term care health plan with pre-tax dollars. The premiums of a long-term care plan can be paid for with an HSA—up to a maximum of $260.00 under age 40, $490.00 between 41 and 50, and up to a limit of $2,600.00 from 61-65.

Pay for their dental care expenses with pre-tax dollars. Health Savings Accounts can be used to pay for dental care expenses ranging from checkups and cleanings, to braces tax free. You employees will even be able to buy into prepaid dental care plans with funds from their HSA plan.

Pay for their vision care needs with pre-tax dollars. Your employees can use the funds in their HSAs to pay for glasses, checkups, contact lenses, cleaning fluids, prescription sunglasses, and other eye care related expenses.

Pay for any “alternative” medical needs with pre-tax dollars. Unfortunately health insurance doesn't always pay for treatments such as acupuncture, herbal medicine, homeopathy, chiropractic, ayurvedic medicine, or a variety of other popular alternative care options. A big bonus of Health Savings Accounts is they give your employees the right to choose their own healthcare options rather than leaving that decision up to their insurance company or HMO provider.