A massage? Health savings accounts may cover more than you think

Spending money on health care isn’t fun, but there is a way many of us can get a nice break on the price thanks to triple-strong tax breaks of health savings accounts. Stephen Neeleman — founder of HealthEquity, a group that services 2.3 million such accounts at more than 33,000 companies — sheds some light on how to reap the benefits.

Q: What are HSAs?

A: An HSA (health savings account) is a tax-advantaged savings account that belongs to the account holder. If an account holder changes jobs, the account and money stay with them, just like a personal bank account. HSAs are always paired with a qualified high-deductible health plan (HDHP). HSAs can reduce your adjusted gross income and lower taxable income. In most states, HSA funds earn interest tax-free. Funds roll over year to year and can be used with Medicare after retirement for qualified medical expenses.

Q: What’s new about HSAs?

A: The IRS is increasing the annual HSA contribution limit from $3,350 in 2016 to $3,400 in 2017 for individuals with single coverage, while the family coverage amount is staying the same at $6,750. And starting in 2016 veterans became eligible in certain circumstances to contribute to an HSA.

Q: How do they save consumers money?

A: HSAs are paired with a high-deductible health plan, which often has a lower premium than a traditional plan. Some of the money you would have otherwise spent on premiums can go into an HSA instead. It allows consumers to save pretax money and withdraw it tax-free when it is spent on qualified medical .

Q: What about for stress reduction?

A: If stress is causing other diagnosed medical conditions, treatments may be paid for with an HSA with a letter of medical necessity from a doctor. Improvement of mental health or relief of stress is generally not covered. For example, the costs of a massage just to improve general health do not qualify it has to be for a pain treatment, and if the massage therapy is recommended by a physician to treat a specific injury or trauma, then it would qualify with a letter of medical necessity. If you have this problem you may be benefit with a Wellness Geeky’s guide into portable massage chairs for your use at home.

Q: Can you use them to pay for your Medicare premiums?

A: Members can use an HSA to pay for Medicare premiums and out-of-pocket expenses that include deductibles, co-pays and coinsurance, including: hospital and inpatient services, physician and outpatient services, Medicare HMO and PPO plans and prescription drugs.

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