Who Can Have An HSA

High Deductible Health Plans

Determining Your Contribution

Using Your HSA

Advantages of HSAs

HSAs

A Health Savings Account (HSA) is an account that you can put money into to save for future medical expenses. There are certain advantages to putting money into these accounts, including favorable tax treatment.

High Deductible Health Plans (HDHPs)

You must have coverage under an HSA-qualified “high deductible health plan” (HDHP) to open and contribute to an HSA. Generally, this is health insurance that does not cover first dollar medical expenses. Federal law requires that the health insurance deductible be at least:
$1,100* -- Self-only coverage
$2,200* -- Family coverage

In addition, annual out-of-pocket expenses under the plan (including deductibles, co-pays, and co-insurance) cannot exceed:
$5,500* -- Self-only coverage
$11,000* -- Family coverage

In general, the deductible must apply to all medical expenses (including prescriptions) covered by the plan. However, plans can pay for “preventive care” services on a first-dollar basis (with or without a co-pay). “Preventive care” can include routine pre-natal and well-child care, child and adult immunizations, annual physicals, mammograms, pap smears, etc.

HSA Contributions

You can make a contribution to your HSA each year that you are eligible. For 2007, you can contribute up to $2,850* if you have Self-only coverage and $5,650* if you have Family coverage

Individuals age 55 and older can also make additional “catch-up” contributions. The maximum annual catchup contribution is as follows:
2007 - $800
2008 - $900
2009 and after - $1,000

*2007 amounts; adjusted annually for inflation.