Health Savings Accounts expand as care costs rise. In other news, people want to save money.
When workers throughout the country get the chance to make changes to their health insurance coverage this fall, some may find that their employer is offering a new option: health savings accounts.
These accounts, which are coupled with high-deductible insurance plans, allow people to put aside money tax free - up to $3,000 for individuals and $5,950 for families in 2009 - to help pay for medical expenses that are not covered by insurance, including things like over-the-counter medications.
One feature that has helped fuel their popularity is that the unused account balance can accumulate and earn tax-free interest, allowing people to save in years of low medical expenses to cover years when health care costs are higher. HSA account holders over 55 can also make increased payments until they are eligible for Medicare (usually at age 65), making the accounts another arrow in their retirement-planning quiver.
