1. • 438,000 -- Individuals were covered in November 2004 by HSA-type insurance plans -- according to the America Health Insurance Providers (AHIP).
2. • 113,000 (roughly 240,000 individuals) -- IRS data on individual tax returns reporting HSA deductions in tax year 2004¹.

1. • 3.2 million -- Seven fold increase to individuals covered by HSA type insurance plans (November 2004 to December 2005) -- according to AHIP.

1. o 31% -- Previously uninsured individuals buying health insurance on their own.
2. o 33% -- Small businesses not previously offering coverage.
3. o Nearly 50% -- Age 40 or over.

2. • $1 billion -- Dollars invested in HSAs by Americans, according to data gathered by Inside Consumer-Directed Care (ICDC) newsletter Feb. 24 issue -- based on financial data provided by more than 60 financial firms including JPMorgan Chase, Wells Fargo and The Principal Financial Group.
3. • 42% -- Number of Individuals or families with incomes below $50,000 buying HSA type insurance on their own, according to "Health Savings Accounts: The First Six Months of 2005" report by eHealthInsurance.

1. • 14 million by 2010 -- Treasury Department projection of HSA policies (covering 25 to 30 million people) -- based on current law.
2. • 21 million by 2010 -- Treasury Department HSA policies estimates rise by 50 percent (covering 40 to 45 million people) -- based on the President’s health care initiative.

1 Individual tax returns do not reflect employer financed HSA contributions.

Source: Intrernal Revenue Service

If you think health insurance is way too expensive to fit into your budget and lifestyle, think again!

You've heard me say this before, but I'll keep saying it until it sinks in - medical bills are the number one cause of bankruptcy! I don't care if you're 19 or 99. If you're breathing, you need health insurance!

WRONG: "How can I afford to get health insurance?"
RIGHT: "How can I afford not to get health insurance?"

The Reasons Why

Your best bet is to be prepared by already having health insurance. Being prepared can keep you and your family out of the poor house. It can keep your spouse from having to work 80 hours a week to stay afloat. It can keep your family from falling apart. I know this because my team and I hear stories like these every day.

Reevaluate

Tax-subsidized Medical Expenses

Even though you have received a tax deduction by putting your money into this account, the money is still yours to spend tax free, as long as you spend it on qualified medical expenses.  Since you have a high-deductible plan, this would of course include any expenses you incur from going to the doctor, purchasing prescription drugs, or paying other expenses toward your deductible.  Once your deductible is met, the health insurance covers your medical expenses as defined in the policy.

In addition to being able to withdraw your money tax free to cover these types of expenses (which might otherwise be covered by a traditional low-deductible high-premium policy), you can use your HSA account to cover other costs that would not normally be covered by a health insurance policy.

These include:

• Dental expenses.  Individuals can typically only purchase dental discount plans, or fairly expensive dental policies with a limited choice of dentists.  Coverage for braces is normally very limited.  However, any of these medically necessary procedures can be paid for from your HSA account.
  
  
• Mental therapy.  This includes the charges of psychiatrists, psychologists, psychoanalysts, and psychotherapists.
  
  
• Physical therapy.  This could include hydrotherapy, chiropractor services, or medical massage therapy.
  
  
• Alternative treatments.  This could include acupuncture, Ayurvedic Medicine, aromatherapy, homeopathy, Traditional Chinese Medicine (TCM), nutritional consulting, or even healing services provided by a Christian Science Practitioner or other type healer.
  
  
• Transportation and lodging expenses, when related to health care
  
  
• Charges incurred as part of a preventive health program.  This could include vaccines, blood tests, metabolism tests, and other lab tests, and even fees paid to a health institute or vitamins if prescribed by a doctor.
  
  
• Nonprescription medications, such as aspirin or cough syrup
  
  
• Special fees incurred by handicapped individuals, including wheelchairs, telephone or TV equipment to assist the hard-of-hearing, the cost and care of guide dogs, or special school costs for the handicapped
  
  
• Maternity expenses that are not covered by your health insurance policy
  
  
• Insurance premiums to pay for qualified long-term care

Also note that the HSA account can be used to pay these expenses for any spouse or dependent member of the family, even if they are not covered under the insurance policy.

2007 brings some exciting changes to the benefits of the HSA.

The HSA has two components the high deductible insurance plan and the tax qualified savings account.

The insurance plan typically cost 30-50% less than traditional insurance and pays 100% of your claims once you have met the deductible. A lot of times you will also reduce your out of pocket exposure when comparing the plan against traditional insurance plans.

The savings account allows you to contribute money up to an annual maximum limit of $2,850 for an individual and $5,650 for a family. You can take an above the line deduction for the amount of your contribution when you file your taxes. The money in the account grows tax-free and you can take tax-free withdraws for eligible expenses including those from medical, dental, vision, etc.