Benefits of an HSA
You may be ready to open enroll in benefits with your employer, and notice this High-Deductible Health Plan (HDHP) and Health Savings Account (HSA) option that has significantly lower premiums than the traditional coverage plans. Or perhaps you are self employed or your employer doesn't offer insurance, and you've found HSA-linked plans to be the most affordable option online.
Is an HSA / HDHP combination right for you?
First, let's look at the benefits of choosing an HSA-driven plan.
- Lower premiums. The most obvious and immediate benefit of having a HSA and HDHP is that premiums will be lower. The premium difference will be anywhere from 30% to 70%, depending on the features and the options that you are comparing it to. In many cases, the savings on premiums will give you a natural way to fund the HSA, or at a minimum put some money back in your take-home pay.
- Power to the patient. Whereas people covered by managed care plans are often at the mercy of the plan requirements when it comes to where they go for medical care and how often they access it, HSAs typically shift more freedom to the patient. It's your money in the account, so you have control on how you use it. You have a doctor who you've known for years and want to continue seeing? You can. You want to have a procedure done at the medical office that is a mile from your house? You can.
- Wise users of the healthcare system are rewarded. If you are relatively healthy and hardly ever max out a traditional insurance deductible, you'll find that you save significant money through an HSA arrangement. If you are someone who doesn't mind shopping around for the best value on healthcare, you'll feel the benefits in an HSA. In addition, those who believe in preventative health are incented to pursue it in a typical HDHP, and come out ahead when it leads to less medical care down the road.
- Potential for building a sizable healthcare nest-egg. The fact that you can contribute tax-free dollars to your Health Savings Account, and roll the balance over from year-to-year means that you could build a sizable sum for healthcare expenses down the road. Imagine the psychological freedom of not be completely dependant on your employer for all health expense coverage. Your account can increase (or decrease) over time as the investment value of your account fluctuates.