|For the Week Ending October 6, 2017
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Important benefits of a Peoples HSA include:
We are all concerned about the cost of health care. The Peoples Health Savings Account (HSA) is one way we’re trying to help you with your Financial Wellness. Our HSA offers you a special opportunity to manage your medical expenses. Here are some questions and answers about the Peoples HSA.
The Peoples HSA (Health Savings Account) is a tax-favored consumer savings account for individuals and families covered by high deductible health insurance plans. Tax-free withdrawals may be taken from your Peoples HSA to pay for qualified medical, dental or vision care expenses. Contributions may be made on a pre-tax basis. Withdrawals can be used to pay for qualified medical expenses with tax-free dollars. This special account works with your health insurance policy.
Contributions are made to your Health Savings Account. Any funds not used will remain in the account earning interest any may be used to help supplement your retirement.
Under a high deductible health plan, the consumer is often responsible for all medical expenses until the policy deductible is met. Funds in the HSA account may be used to pay the amounts due. Many, but not all, health insurance plans pay all medical expenses once the deductible has been met. In other cases the plan moves into co-insurance, such as the plan paying 80% and the consumer 20%, until the out-of-pocket maximum has been reached.
Your Peoples Health Savings Account, combined with a high deductible health plan, may replace a much higher cost, more restrictive, traditional health insurance plan. Premiums on traditional health plans with co-pays are typically higher in cost, more restrictive and still leave you with out-of-pocket expenses.
Take the premiums you currently spend on traditional individual or group plan and split that up into two sections. One part will pay the premium for the lower cost, higher deductible health insurance plan and the other part goes into your Peoples Health Savings Account.
Regardless of your health plan coverage, tax free dollars can be used for qualified medical expenses like dental and vision care. Funds may also be used to pay for anything the consumer wishes, but prior to age 65, the tax penalty will apply similar to IRA regulations. After age 65, funds can be used to supplement retirement with only normal taxes and no penalty.