Many changes have been made to assist self-employed and small businesses afford health care. Premiums are now tax deductible, benefits continue to be income tax free, firms of 2 or more are guaranteed issue but perhaps the most exciting thing is Health Savings Accounts (HSA).

HSAs started out as Medical Savings Accounts; in their present form they unbundled comprehensive health insurance into two components, major risk and tax deductible savings to cover smaller expenses.

A qualified high deductible insurance plan must be in place to establish a tax qualified savings account so your present policy probably will not work. The rules for qualified plan are laid out by the federal government and are actually very fair and to the consumer's advantage. Once you have an HSA you put from zero to the annual maximum allowed into your own savings account. This is your property; it can be withdrawn from throughout your life time. Of course there are some strings the feds attach to make sure it is used for health care but the spectrum is broad, broader even than the insurance policy allowing for things like, dental, vision and hearing.

You pay for small expenses after the insurance company applies any discounts they have contracted with, this alone reduces risk and you can earn interest on savings accounts. Once you meet the stop-loss of the major risk policy that is it for the year as far as out of pocket expenses are concerned. In almost every instance the stop-loss is less than traditional insurance policies better protecting you from huge medical bills.

We would like to talk to you more about HSAs for you, your business or more traditional plans. Contact us at 800-347-6114 or by filling out our contact form.