It is being said that under the new Medicare law people with health savings accounts would be able to save between 10 percent to 35 percent on any medical costs covered by money in their accounts.
Some of the nation’s biggest insurance companies are now offering inexpensive health insurance policies with high deductibles combined with savings accounts. The money that is put in the saving accounts is tax deductible and tax-free, which builds up and can be withdrawn to pay for medical expenses, should they arise.
New York Times December 9, 2003
I have known about this for sometime and I am happy to hear that Medical Savings Accounts are becoming easily available now.
The Medical Savings Account (MSA’s) is designed to help address the rising cost of health insurance in the United States. MSA’s are available to: self-employed persons; small-business owners with 50 or fewer employees; self-employed partners of professional corporations; and employees of small businesses that provide a high-deductible health insurance. You may qualify to set up an account that would allow you to pay for certain medical expenses with the tax-free dollars you contributed into the account.
That is exactly what I did. For the last 17 years I have paid less than $300 a year for my health insurance, but I have a $10,000 deductible. So essentially, I am self-insured. But the money that I have saved in premiums is more than able to pay the $10K, should I ever need traditional medical care. But I carefully follow my own health program and I don't ever anticipate using it. So the premiums I save go into a savings account and earn interest, rather than going to an insurance company.
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