Unlike medical savings accounts, HSAs are not limited to the self-employed or businesses with 50 or fewer employees. By contrast, HSAs allow anyone under the age of 65 who enroll in a compatible “high deductible” health plan (HDHP) to make tax-free contributions. In addition, HSAs allow enrollees to contribute 100% of the deductible, not to exceed $2,900 for individuals and $5,800 for families in 2008, which eliminates any post-tax expense. HSAs allow both the employer and employee to contribute to the same account in the same calendar year. HSAs are not part of a demonstration act and, therefore, are permanent and not restricted to the number of total enrollees.  Individuals over age 55 may contribute an additional $900 in 2008 and $1000 in 2009.
 

Health Savings Accounts are similar to MSAs in that, they are 100% tax deductible, they are employee owned, they rollover from year to year and earn interest tax-free. Similarly, funds can be rolled into investment options, used to pay for qualified medical expenses tax-free, and used to supplement income at retirement. As with an MSA, withdrawals from a Health Savings Account for non-qualified medical expenses will result in penalties and taxes.

Health Savings Accounts will revolutionize the way healthcare is provided in our country. They will restore the doctor-patient relationship, allow patients to become consumers of their own healthcare, be more affordable and receive unprecedented tax benefits. Health Savings Accounts are the future.