• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
  • Skip to footer

Doctor Disability HomepageDoctor Disability

Helping Physicians & Dentists Protect What Matters Most

  • Get Quotes
  • Learn
    • Physician Disability Insurance
      • Anesthesiologists
      • Cardiologists
      • Dermatologists
      • Emergency Medicine Physicians
      • OB/GYN Physicians
      • Ophthalmologists
      • Orthopedic Surgeons
      • Otolaryngologist/ENT Physicians
      • Plastic Surgeons
      • Radiologists
      • Urologists
    • Disability Insurance For Dentists
    • Medical Resident Disability Insurance
    • Disability Insurance Companies
      • Guardian/Berkshire
      • Lloyds of London
      • Mass Mutual
      • MetLife
      • Principal
      • The Standard
      • Union Central
    • FAQs
  • Contact
  • Get Quotes
  • Learn
    • Physician Disability Insurance
      • Anesthesiologists
      • Cardiologists
      • Dermatologists
      • Emergency Medicine Physicians
      • OB/GYN Physicians
      • Ophthalmologists
      • Orthopedic Surgeons
      • Otolaryngologist/ENT Physicians
      • Plastic Surgeons
      • Radiologists
      • Urologists
    • Disability Insurance For Dentists
    • Medical Resident Disability Insurance
    • Disability Insurance Companies
      • Guardian/Berkshire
      • Lloyds of London
      • Mass Mutual
      • MetLife
      • Principal
      • The Standard
      • Union Central
    • FAQs
  • Contact
866-899-7318Get Started
Got questions? Speak to an agent.
(866) 899-7318

Are HSAs the Secret to Reducing Health Care Costs?

February 15, 2013 by Chuck Krugh, CFP

As the uncertainty of the economy and health care reform regulations washes over the business community, many  are considering dropping their health care plans due to the increased cost.  Some employers, however, are proactively searching for alternatives and are finding a very effective one with Health Savings Accounts (HSA). HSAs are a health plan alternative that provides individuals with a much more “consumer- oriented” approach to dictating how much they spend on health care thus lowering their overall health care expenditures. With the responsibility for determining which health care providers and services to use shifted to the individual, HSAs may very well be the secret to reducing health care costs for both employers and individuals.

 What exactly is an HSA?

An HSA is an account, much like an IRA, which allows for tax deductible contributions. Are HSAs the Secret to Reducing Health Care Costs?The funds are also allowed to accumulate on a tax deferred basis. Annual contributions of up to $2,600 may be made by individuals ($5,150 for families). The funds from an HSA can be used to pay for all eligible medical expenses including health insurance premiums. Unused HSA funds can be rolled over into the next year.

In order to qualify as an HSA under the tax code, it must be combined with a high deductible health insurance plan (HDHP) which, typically, carries a high deductible upwards of $5,000. Because of the high deductible, HDHP premiums are usually very low. The deductible expense can be paid from HSA funds as well.

HSAs established through employers are eligible to receive employer contributions. If an employee leaves an employer, the HSA can be go with him and used to cover medical expenses with or without an HDHP. If the funds are used for anything other than medical expenses, the withdrawals may be subject to a 10% IRS penalty.

Reducing Health Care Costs with HSAs

Most employers want to be able to provide a substantial health care benefit for their employees. They must do so to be competitive when attracting quality employees. HSAs are not only a viable alternative, they can serve to keep employer and individual health care costs down, they can empower individuals in the health care marketplace.  With individuals being more conscious of costs – the less they can pay for health care, the more they can stretch their HSA funds – the more they can influence health care costs in the marketplace through competition. Also, they will be much more discerning with their use of medical services which is key to reducing health care costs.

People want more transparency in the health care industry, and, with rising health care costs forcing more and more people out of individual or employer-provided coverage, they are becoming more cost-conscious.  Many experts believe that the main obstacle to reducing health care costs lies in the fact that consumers are too far removed from the actual costs because they’ve been paid by insurers.  If consumers were more involved in the pricing of medical services, a market-driven supply/demand dynamic could put downward pressure on health care costs.  This dynamic seems to work in every other industry. Maybe it’s time to let it work in the health care industry.

CategoriesMedical News TagsAffordable Care Act,  health,  healthcare,  healthcare reform

Primary Sidebar

We’re Here To Help!

(866) 899-7318
Contact us online.

Start Your Free Quote

Compare prices from the best disability insurance companies.

Join over 20,000 physicians & dentists.

Get Free Quotes!

Testimonials

      “I can see why so many of my colleagues sing their praises. Thanks for making a potentially confusing decision so simple and easy!”
– Anna C., Emergency Medicine Physician

     “Excellent service. They were thorough, professional, and took their time to explain the details and pros and cons of the available options. I will recommend to physician colleagues!”
– Charles K., Gastroenterologist

     “I started using Doctor Disability for my life insurance and had such a great experience that I decided to return for disability insurance.  I highly recommend Doctor Disability to my fellow colleagues when they need insurance coverage.”
– Ricardo C., Family Medicine Physician

     “Doctor Disability was great! They provided excellent customer service, comparison of plans, and explanations of terminology that was very useful in making my decision. I will definitely recommend to colleagues.”
– Heather W., Urologist

Explore

  • Physicians_Disability_Insurance_Guide
  • 27 Frequently Asked Questions
  • 11 Disability Insurance Shopping Tips
  • Common Causes of Disability
  • Glossary of Disability Terms

Footer

LEARN

  • Physician Disability Insurance
  • Disability Insurance for Dentists
  • Medical Resident Disability Insurance
  • Disability Insurance Companies
  • FAQs About Disability Insurance for Doctors

COMPANY

  • About Us
  • Meet The Team
  • Contact Us
  • Privacy Policy
  • Legal
  • Accessibility Statement

Check out our Google Business Reviews
Copyright © 2023 · Doctor Disability · All Rights Reserved · Legal · Privacy Policy