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Health Savings Accounts

The logical solution for managing
health care expenses

Many people pay high premiums for health insurance coverage they seldom use. Some employees are uninsured because their employers cannot afford to offer a traditional health insurance plan. Many medical expenses are not covered by any health insurance or are subject to limits that can leave employees with mounting medical expenses and no way to pay for them. The prospect of increasing medical expenses after retirement and the uncertain nature of Medicare compound the problem.

The HSA Solution

One option that millions of employees are now using is the Health Savings Account (HSA). This allows the employees to have a tax-deductible vehicle for paying their medical bills. In addition, the HSA can serve as a supplement to retirement savings. Through Health Savings Administrators you can have a Health Savings Account and have a choice of 22 investment options

What is a Health Savings Account?

Simply put, a health savings account (HSA) is a plan that allows you to put money in savings and at the same time deduct it from your gross income at tax time. The great part of this program is that if you don’t need your savings account for medical expenses, you keep it and it can continue to grow for you! After reaching age 65 you may use your savings tax-free for medical expenses or use it for non-medical expenses and pay only your normal tax rate.

Eligibility and Contribution Limits

To be eligible to contribute to a Health savings account you must be covered by a high deductible health insurance policy. You cannot be covered by any other policy, including Medicare, Tricare, or a spouse’s Flexible Spending Arrangement (FSA). The contribution limits are set by the IRS each year and are indexed to the Consumer Price Index. Your maximum allowable contribution is determined by the limits set by the IRS for that year, your insurance coverage (i.e. Family or Single), and your age. Taxpayers age 55 or older are entitled to a catch-up contribution.

Contribution Limits	2010
Single	$3050
Family (all non-single policies)	$6150
Catch-up (for those age 55 or older at any time in the tax year)	$1000

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Deleware National Bank. Member of the Fulton Financial Family.

• HSA Overview
• HSA Tax Information