Designed for high-deductible health plans

The skyrocketing cost of health insurance is a problem that refuses to go away. In fact, experts say that the worst is yet to come. One result of this is the advent of the high-deductible health plan (HDHP.) These plans lower monthly premiums by raising the deductible, the amount you pay out of pocket before the insurance kicks in.

A SeaComm Health Savings Account (HSA) allows a person covered by an HDHP to make tax-deductible contributions, accumulate earnings on a tax-deferred basis, and withdraw money tax free to pay for out of pocket qualified medical expenses including deductibles.

Frequently Asked Questions:

Q. What is an HDHP?

A. A High Deductible Health Plan (HDHP) is a health plan product that, when combined with a Health Savings Account (HSA), provides insurance coverage and a tax-advantaged way to help save for future medical expenses.

The HDHP/HSA gives you greater flexibility and discretion over how you use your health care dollars.

Contribution Year Regular Contribution Catch-Up Contribution
(age 55 or older)

 

Self-Only HDHP Coverage

Family HDHP Coverage

 

2014

$3,300

$6,550

$1,000

2015

$3,350

$6,650

$1,000

If you are covered by a prescription drug benefit plan, you are not eligible for an HSA unless this plan is part of the HDHP or doesn’t provide benefits until the minimum annual deductible has been met.

Q. What are the contribution limits?

A. For 2014, the Health Savings Account (HSA) annual contribution limits are a maximum of $3,300 for individuals or $6,550 for families OR your plan's deductible amount, whichever is less.  Individuals or employers can contribute to an HSA at any time throughout the year up to the applicable contribution limit.  And if you’re age 55 and older, you can make additional $1,000 “catch-up” contributions.

Q. Am I eligible to contribute to an HSA?

A. You are eligible to contribute to a Health Savings Account (HSA) if you are:

  • Covered by a qualified high-deductible health plan (HDHP)
  • Not covered by other health plans which do not qualify as an HDHP
  • Not enrolled in Medicare
  • Not receiving or have received veterans medical benefits in the previous three months
  • Not claimed as a dependent on someone else’s tax return

Q. In summary, what are the main benefits of HSAs?

A. The main benefits of HSAs are:

  • Protection  – You will have an opportunity to save money to pay high or unexpected medical bills
  • Affordability  – High health insurance policy deductibles mean lower premiums.
  • Savings  – Your ability to deduct your contributions and the tax deferral of account earnings enable you to build your account.
  • Flexibility  – You can contribute at any time during the year, and your HSA balance rolls over from year to year.
  • Portability  – You own the account, so it goes where you go, regardless of any job changes.

For more information on a SeaComm HSA, contact Jeff Reynolds at 1-800-764-0566, extension 266. Jeff will be happy to answer any questions you have regarding this new benefit available at your credit union.

*This article is not intended as tax advice. For more information on tax benefits contact a tax professional.

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