Health Savings Account (HSA)

A HSA is a tax-advantaged account allowing enrollees of a high deductible health plan to set aside pre-tax dollars for future medical expenses. This account is employee owned and unspent funds rollover annually. Employer contributions are not subject to FICA. In order to establish a HSA, you must have coverage under a HSA qualified high deductible health plan (HDHP). Generally this high deductible health plan does not cover first dollar medical expenses and Federal law requires the following:
• Insurance deductible must be at least $1,150 for a single, $2,300 for a family
• Annual out of pocket maximums including deductibles, co-pays and coinsurance cannot exceed $5,800 single and $11,600 for a family.
• The maximum that you can contribute to a 2009 HSA is $3,000, single and $5,950 family. Individual's age 55 and older can make additional annual catch-up contributions of $1000 in 2009.