Dennis Sponer CEO, HSARx
It’s no secret that people and businesses like to save money. As a business owner, it’s not only important to save money, but also to be able to create a happy, and healthy, environment for your employees. One of the most popular ways for saving on healthcare is using a health savings account, or HSA.
Like many financial programs, the rules associated with them can feel overwhelming. But with HSAs there is nothing to fear – and much to gain – by understanding the ins and outs of how these accounts function.
How an HSA Works
Think of an HSA like a personal savings account specifically used for your healthcare related expenses; it’s yours to take with you. Rather than an ordinary insurance card, your HSA debit card can be swiped at your doctor’s office, dentist office, or optometrist’s office. Other healthcare expenses including prescription and non-prescription over the counter medication, certain medical equipment, and nutritional, phycological or psychiatric counseling services. These expenses even extend to menstrual care products, medicated sunburn treatment, adult diapers, nutritional counseling and psychological or psychiatric care services.
Benefits to Your Business
Offering an HSA comes with several benefits for the employer spanning tax and premium savings. Employers can make contributions to employees’ HSA that are contributed pre-tax and grow tax-free. Company contributions are tax-free and tax -deductible, as well as earn tax-free interest over time. In 2022, the maximum annual contribution is $3,650 for individuals, or $7,300 for families, on a high-deductible health insurance plan (that is a health plan with an annual deductible of $1,400 or more for individuals or $2,800 for families).
The funds contributed to an HSA are directly accessible to employees – it’s as simple as swiping a debit card. Employees pay directly for their necessary medical expenses from their HSA account. If you choose not to use your HSA debit card, you can use any personal payment method and save the receipts for reimbursement from the HSA later. These funds can be used to pay for qualified services or copays for services. Being fully at the hands of the employee, these accounts also help individuals save for necessary medical expenses resulting in healthier employees with fewer missed days due to illness or injury.
Most importantly, HSAs are viewed as a valuable, sought-after perk by employees, which can help attract top-tier talent to your company. With healthcare costs climbing and inflation rising, it has never been more important to prioritize employees and provide a variety of healthcare options for them to choose from.
