Why Should I Consider a Health Savings Account (HSA)?

Dave strongly recommends considering your Health Savings Account (HSA) options since they can provide long-term flexibility and money-saving opportunities for dealing with health insurance. By taking a higher deductible with no co-pays, you can greatly reduce the cost of the plan, many times by as much as 50%. You can then use the cost savings to fund the savings portion of your HSA, which can be used to pay expenses that are subject to your deductible – you can consider the money in your HSA savings account part of your emergency fund. If you have no expenses, you keep the money and can continue to fund each year, allowing you to grow your fund for future health expenses. The higher deductible has also been shown to have lower future rate increases At age 65, any savings you have accumulated can be used to offset medical expenses not covered by Medicare or supplement type plans. Unless you had ongoing medical conditions that would cause the deductible to be met on a regular annual basis – or the group plan does not offer the savings over the PPO option – the HSA tends to be the best option. If you get a job with a company offering the HSA option as part of their group plan, you can consider rolling your savings into one plan.