Trading Floor

Discussion: 5 Comments

• Posted by Pat R on June 14, 2009 5:17 AM

  I opened an HSA account about 1 year ago. I did some online research before doing so and chose one with low fees, The Bancorp Bank. It was hard to remember to pay for qualifying expenses with the debit card or a check from that account for awhile. These accounts are alot like IRA’s because of the rules for their use after age 65. I like that I get a credit on my tax return for the yearly contribution and that’s in addition to the credit for my IRA contribution. I am self employed so I also take a credit for my health insurance premiums. I receive my statements by logging into my account online and I have had no trouble reading them. They sent me a booklet when I first opened the account with a long list of qualified and not qualified expenses.

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• Posted by Susan Casscells on June 14, 2009 6:11 PM

  Dear Marketplace, Ten years ago when my husband and I went into business for ourselves, we chose an MSA now and HSA plan to cover our health insurance needs. We were younger then, healthy and wanted to save as much as we could to put in the business. Now, ten years later, the HSA is a fabulous plan for us. Through Blue Cross Blue Shield of Delaware, our HSA plan is a $10,000 family deductible. The monthly insurance premiums are affordable and we have saved $40,000 tax free towards future medical expenses. Moreover, the plan covers routine medical costs BEFORE the deductible - yearly medical exams, pap smears, psa testa, colonoscopies, children’s immunizations, eye and hearing exams and much more. Moreover, when we go to the doctor for other reasons, all Blue Cross Blue Shield contracts are in effect. So, if I go to the doctor for an illness and I am charged $250 and Blue Cross Blue Shield has negotiated a contract with that doctor for $125, that’s all I pay. I can go to any doctor within the plan with no referral required. Our HSA statements are easy to read. I keep $10,000 in my HSA to cover my deductible and the rest is in an Ameritrade account which is invested in mutual funds and stocks which I choose. Those statements come to me every month.

  It is important to really examine HSA plans before signing up. After our deduticble is met, BCBS covers 100% of our expenses. Some plans cover less - 80% or 60%.

  Contact me if you are interested in more information about HSAs.

  Sincerely, Susan Casscells Wilmington, DE

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• Posted by Klaus K on June 16, 2009 5:26 AM

  I agree with the above comments my HSA is one of the least confusing parts of my health care. My current employer deducts an amount from my pay and its agent (Wells Fargo) provides me with a Debit card & quarterly statements (I can view balance at anytime online.)

  I have been able to use their card at the pharmacy, MD, dentist and optometrist. My wife has a FSA and seems to only be able to use her card at the pharmacy. Also she has to accurately estimate her expenses (maximum pretax vs. lost unspent balance), while I only make sure I’m putting in more than I expect to spend (much less stressful).

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• Posted by Clare LaFond on July 6, 2009 8:23 PM

  I’ve learned two important lessons in my ongoing HSA experience.

  First, I learned to carefully check all of the layers of fees when using the HSA as an investment vehicle. After wondering about my dismal account balance despite the positive investment performance, I added up the HSA administrator’s fee, the investment account administrator’s fee, and the relatively high fees of the investment funds offered. It turned out that even with above average investment returns, the combined fees would deliver a net loss in my account. Now I keep my investments outside of my HSA, and put money into it just to cover what I need to take out for the next month.

  My second learning experience was to carefully look over the medical billings. This was brought home when a clerical coding error charged an expensive procedure that I didn’t have. It took six months to get it straightened out through all of the involved parties (doctor, clinic, hospital, insurance company). I don’t use a debit card so that I’m forced to pay more attention to what is being charged.

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• Posted by Tram C. on July 6, 2009 10:22 PM

  I’ve had my HSA for almost 3 years now. Since I pay for the qualified medical expenses from my personal account first and then reimburse myself from the HSA account, I thought I had to reimburse myself in the same year as the expense. That’s not the case. As long as your withdrawals are for “qualified medical expenses”, you should be fine. If you’re not sure what qualifies, see IRS Publication 502: Medical and Dental Expenses. The US Treasury also has an FAQ on the HSA: http://www.ustreas.gov/offices/public-affairs/hsa/faq.shtml

  Jo, your HSA administrator’s documentation probably defines the administrator’s rules for using the account/fee structure etc which usually can cause confusion with the legalese.

  The second thing you should know is that you have to fill out Form 8889 each year when you file your federal income tax return. So keep your receipts in case of audits. You have to declare the amount of distributions received from your HSA and the amount of your contributions. Your HSA administrator will also send this information to the IRS.

  Basically, it sounds complicated but the HSA is like the Flexible Spending Account but your balance accrues each year versus the “use it or lose it” feature of the FSA. Also, if you’re unemployed, you can pay COBRA insurance premiums from your HSA. Even if you no longer have a high deductible insurance plan (which means you can’t contribute to the HSA), you can still withdrawal from the HSA to pay for qualified medical expenses.

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