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Health Savings Accounts: Contributions And Deductibles

Daily, the cost of medical care in America soars to new heights. Those without proper health coverage face an unsure financial future and the possibility of being denied care. Insurance costs themselves are getting quite pricey. The average individual cannot afford their own personal health care policy forcing them to rely on their employers for this benefit. This puts an extra burden on small business owners who have to pay out for insurance policies in order to retain staff.

Health savings accounts were introduced to help offset some of these costs. The employer will get a financial break and the employee will get greater control over their financial medical costs. Anyone is eligible for a health savings account. New legislation has allowed all employers to take up this option.

When opening a health savings account, many need to know how mush they are allowed to put in. they also need to know what other terms and conditions apply to their particular account. There are limits to how much you can put into your account annually. However, standard health savings account allows you to carry this money over from year to year.  Generally your contribution limit is based on a high deductible insurance policy. In 2007 account holders were allowed to place 2,850 $ annually for a single person and 5,650% dollars for a family. This is equivalent to the amount of the deductible on both policies. If your over the age of 55 and additional contribution of 800$ is allowed.

This may not sound like a lot of money but one must remember that these funds are only used on medical expenses that your insurance policy does not cover. The money can also accrue interest and can be carried over from year to year and employer to employer.

When opening a health savings account, generally you must have a high deductible health insurance policy. The minimum requirement for a high deductible health plan is 1050 for singles and 2,100 for families. You also have limits on the annual out of pocket expenses. For singles it cannot exceeds 5,250 and families 10,500.

A health savings account may sound like a huge numbers game. However, the amount that can be accrued can make a huge difference when you need it. Health savings account may not seem important. However, they help employers with costs and workers gain control over their future medical expenses.

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