Heath savings accounts, popularly known as HSAs are tax-advantaged medical savings accounts that are available to taxpayers in the United States who are enrolled in a high-deductible health plan (HDHP). Funds contributed in these accounts are usually not subject to federal income tax at the time of deposit. The other advantage in keeping a health savings account is that funds in these accounts roll over and accumulate year after year if they are not spent. The accounts are owned by individuals and therefore the individual is the sole beneficiary in the end.
Users can use funds in their hsa medical savings account to pay for qualified medical expenses at any time without worrying about federal tax liability or penalties. Over the counter medications cannot however be paid from the accounts without a doctor’s prescription. Withdrawals for non-medical expenses are usually allowed and they are treated the same way with those done on individual retirement account. This means that they can provide tax advantages if they are done after retirement age. If taken earlier though, they may be subjected to penalties.
With all these benefits, it is important for employers to be at the forefront pushing their employees to open up health savings accounts. Besides, it has already been said that HSAs are the important reforms that are here to help reduce the increasing costs of healthcare as well as increase the efficiency of the healthcare systems. But how can an employer help his employees find the best strategy for their HSAs?
They say that in everything, communication is key in driving the information home. It is not enough for an employer to just come up with an idea about health savings accounts without offering an explanation to his employees. Talk to them about the idea first, then go on to hold an active enrollment, where employees are free to ask questions before they can sign up. Prepare them first before the date of enrollment, by sending them enough information days before.
HSAs are barely new and so, a lot of people may not be in the know about what they really are and how they operate. It is important to take time off to educate your employees about healthcare plans you feel will benefit them more. Most of them will have plenty of questions, therefore be prepared to take them through the benefits as well as the disadvantages.
In as much as you want to benefit your employees alone, there is an important part of them at home that you need to address for better decision making. Some will not make decision alone and to show that you support them, prepare some written documents that they can take home with them. The documents should contain the entire information pertaining to health savings account eligible plan, the benefits and enrollment procedure.
Introducing a more expensive medical health savings account plan to your employees will not be as easy as it sounds, even if it has more benefits to offer. If you are nervous, find someone to do it on your behalf.
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