Yes, but there is an annual limit on how much you can put into an HSA, and if you actually spend some of that money on ongoing medical expenses, the balance available for investing might not be enough to be worthwhile. </p>
<p>But certainly it is an option – especially for someone who is fairly well off financially. You do not have to use the HSA account to pay medical expenses. So you could pay expenses out of cash on hand, and take advantage of the tax-sheltered status of the HSA account to either accumulate funds or make investments. So that would be just one more tax benefit from the account.</p>
<p>I am in California and I have a HSA. My particular plan is a grandfathered plan (currently not offered) - but my insurer (Blue Shield) is listing other HSA plans as available on their web site. </p>
<p>California does not appear to list any HSA’s with the upcoming exchange, but the doesn’t mean that such plans are not “approved.” I am assuming that I will be able to keep my plan or go to the exchange. Based on what I have seen of rates, I am thinking that I will probably be better off sticking with what I have, though obviously the rates could go up or the plan I am on could be discontinued.</p>
Actually, I believe the ACA is specifically structured to be compatible with HSA’s – HSA’s are mentioned in the ACA, and I think the law was designed so that the maximum annual patient responsibility is the same under ACA as under HSA plans. </p>
<p>However, HSA’s do now have to provide the same preventive care benefits as other policies – I have already seen the benefit of this, and I assume that it is part of the reason for my most recent premium increase. It’s probably something of a wash – the fact that the my insurance company is now on the hook for some routine preventive stuff will increase their basic out-of-pocket costs for each person insured, but those are low end, easily controlled costs, and better preventive care will result in savings at the higher end for the insurance companies, to the extent that the preventive care catches problems before they become emergencies.</p>
<p>RE; HSA plans in CA. I’ve worked with a very good broker for several years and we ‘chew the fat’ about twice a year. According to him, HSA’s are non-ACA compliant due to their high deductibles. At our last conversation - about 8 weeks ago - he thought their CA fate was undetermined but that their continued existence would require a wavier or some type of extension on the high deductible issue.</p>
<p>Also…as far as being grandfathered…our BS plan was ‘grandfathered’ until we received notice that it was not…they just stopped offering it.</p>
<p>On a good note…I did receive a letter from BS stating that due to new requirements, coverages can not longer be limited due to gender. So I guess H is now covered for a pap smear and my first prostate exam will be covered under the preventative clause </p>
<p>It’s a waiting game…and even then my guess is it will be the same problem as we’ve had all along…you don’t know what you’ve bought until you’ve signed on the bottom line. THEN you get a copy of the 50 pages of fine print.</p>
<p>I wonder how many people actually use their HSA as a tax sheltered investment vehicle. Smart maybe, but that doesn’t really seem appropriate. I’d have to think about that one.</p>
<p>calmon…I believe most HD plans had to have preventative care even before ACA.</p>
<p>a HSA is like a super Roth IRA, tax free savings, but also tax deductible. $6,400 limit for family plan, almost better than funding a Roth. No doubt, at some point there will be medical expenses.
I did read where the HSA were under attack by obamacare, hopefully they stay</p>
I had a copay or a percentage to pay on preventive care before ACA, of around $40 depending on the procedure. When ACA passed, the plan was modified and there is no longer any copay for the preventive stuff. Big difference on the cost of a colonoscopy.</p>
<p>Why not? It’s your money. If you have a medical bill for $2500 that your insurance won’t cover – you might as well pay it out of taxed dollars as untaxed funds – assuming you have the assets to cover it. </p>
<p>I don’t, because I’m really not in the position where I can write a check for $2500 out of my regular account without feeling all angsty, and I’m not exactly a high rolling investor in any case. So it’s not as if I have to go hunting around for tax shelters. </p>
<p>But I certainly can see that if I was a 6 figure earner, it would seem rather silly to maintain a bank account just to cover a few thousand dollars of an insurance deductible – and then the whole investment idea might seem a lot more attractive.</p>
<p>“But I certainly can see that if I was a 6 figure earner, it would seem rather silly to maintain a bank account just to cover a few thousand dollars of an insurance deductible – and then the whole investment idea might seem a lot more attractive.”</p>
<p>I suppose I can see the potential for someone to invest in it for decades, at the max, with a great rate of return turning it into millions (if they didn’t use it much, in the early years), tax free and tax deductible. But if it can only go towards health care, then certainly at some point it wouldn’t be worth continuing to contribute. I don’t believe in leaving money you might not use soon in a bank account either.</p>
<p>lots of ways to use HSA $$$ even with medicare:</p>
<p>“use the money tax-free for medical expenses that aren’t covered by insurance – such as co-payments, deductibles, prescription drugs (including over-the-counter drugs with a prescription), vision and dental care, and a portion of long-term-care premiums based on age ($3,290 for age 61 to 70, for example). She can also use the money from the account tax-free to pay her premiums for Medicare Part B, D or Medicare Advantage”</p>
<p>dstark, do you know if the medicaid expansion is still happening in January of 2014? I will qualify for that when it happens, taking a large expense off my back while I’m in school at least… (if it makes financial sense for me to drop the plan I’m currently on… I’m not sure what Medicaid is going to look like in MI in January due to the ongoing… debates…)</p>
It can be withdrawn for any purpose after age 65. If withdrawn for a non-medical purpose, whatever is taken out would be taxable as ordinary income, but there are no penalties at that point.</p>
<p>So it functions just like an IRA, except that the withdrawal option kicks in at a slightly higher age. </p>
<p>So the bottom line is that the money can go for anything you want after age 65.</p>
<p>his is one of the chores I have on my list to do, is to find out about this. My kid starts full time work in a couple of weeks, will have health insurance offered, but no way will it be as good as he’s got right now. I am really reluctant to call my health insurance company and ask if we can keep him on ours, because I fear it will instantly flag a letter to us demanding that we remove him from our insurance.</p>
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<p>Sorry - don’t know if this got answered in the many pages I skipped (couldn’t stay focused) - but you must find out. If he is not supposed to be on the plan and you keep him on, you are committing fraud - and if caught, you’ll have to pay everything back. Don’t do it! There are a bunch of hard-to-follow rules regarding when/how kids to 26 must be covered. Many companies who do not “have” to cover kids to 26 will do so, anyway, especially if they offer more than one type of plan — since often one of the plans must cover to 26 and another might not be required to do so (such as when there is a traditional or PPO plan and an HMO). You really need to check the plan. You don’t need to ask … just get the plan document & read it yourself. It will be clearly spelled out. If it’s not available on a website, ask HR for the plan document.</p>
<p>The other thing to watch for is whether the kid is covered until the 26th birthday or until the end of the year in which he turns 26. It is usually the birthday, but some employers choose to cover until the end of the year.</p>
<p>Only health insurance is affected by PPACA, so the age-26 rules don’t apply to other insurance (such as vision or dental). Some employers do choose to apply the same age rules to all, though, so again … check the plan documents. If you ask, HR must provide them to you.</p>
<p>Ah … the same applies, though. Companies have to cover the kid even if he has other health care available, unless they don’t have to. Clear as mud, right?? You have to ask the HR office (but again, this should be in the plan document language). Companies that have not made material changes to their plans since a particular date in time don’t have to comply, but some will even if they don’t have to.</p>
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