Health Savings Accounts (HSA)

Well, I have some minor health issues, my hubby never goes, and I have a 2 year old and a 9 year old. We put $800 on last year and spent it up. We put $1200 this year and still have a few hundred dollars on it. I've been in the hospital twice, my 9 year old broke her wrist, my 2 year old had stitches, plus co-pays, prescriptions, my contacts, etc. It's been plenty for the "unexpecteds".

Does your company make contributions, too? Ours does and it totals about $1400/year. To that, my hubby adds $100/pay or $200 per month and it's PLENTY for the 3 of us. Our visits sound similar to yours. This year we've had a lot of "extra" visits for weird things and it's still plenty. LOVE our HSA!

I LOVE our HSA! My husband's company changed insurance offerings last year; after reviewing the different offerings and the cost associated for each, we switched from a traditional PPO to an HSA.

My first suggestion - double check your HSA does in fact carry over from year-to-year; most HSA accounts now offer that flexibility, but double-check to be on the safe side. (We used to have a Flex Spending Account that was use it or lose it.)

We contribute $100/month along with the employer contribution of $1200/year for a total of $2400/year. Our three kids are healthy, each visits the doctor for annual wellness check-ups and a couple times a year for sick visits. We all visit the eye doctor annually as well as the dentist regularly, using our HSA to pay out-of-pocket dentist expenses and for two pair of glasses for my husband, along with prescriptions and over-the-counter medications. Even with a couple larger medical expenses paid using our HSA, we ended last year with a nice nest egg that carried over to this year.

If your new HSA does carry over, then $2200 a year sounds like a good start for your family. Worried it might now be enough? Determine if you can squeeze a little extra out each pay check and sock away a little extra. As mentioned before, most HSAs sit and gather a modest amount of interest so it's a good way to save extra money for future medical expenses pre-tax.

Good luck!

An HSA does roll over what does not rollover is a flex plan which is a use it or lose it plan. The good thing about an HSA is it works more like an IRA the funds will grow tax free and you are using pre tax dollars to pay for your health care. I would say to put away as much as you can afford because whatever you do not use will be available to you in future years, even after you quit working and can no longer make contributions the funds will be there to pay for health care.

What we recommend to our employees is to put away what is needed to meet their deductable for the first year, if they can afford to do so. After our contribution this is 1,200 an employee or 50 a pay period. The next year you fund to replace what is used the year before. That way you are covered for anything without out of pocket.

A lot of employees choose to over fund since it can be carried over for the rest of your life and used for long term care that is not usually covered by insurance. It is a great way to save tax free for your life time health needs.

Sorry I didn't check back on this since I hate misinformation. All HSAs can be rolled over! It is the med-flex MFSA that is use it or lose it. I really wish people would keep quiet when they don't know what they are talking about. :(

I have an FHSA, have had for the last 4 years. Beginning last year, the funds roll over. I love it. We have a max of $4000 so, I get the max. I wasn't sure when I started so, I did 1,000, then 2,000 the next year. Finally, this year & last, I opted to do the max of $4000. My son isn't as sick as he used to be so, I still have about $800 left for the year. We've used it on deductables, surgeries, dental, past bills (I'm using it to pay off bills from the 1st 3 months of my sons life...about $800 dollars since I didn't have insurance on him...he just turned 9 years old this month). Again, I love it!

We really like ours since we changed to an HSA as well...I think you'll find it pretty good. Also, ours can also be used for dental bills, don't know if that's universal or not, but you should check it out, b/c even with dental insurance, you usually end up paying quite a bit out of pocket and with a family of 4, those bills add up too...and if you haven't taken your 3 year old to the dentist yet, this would be a good year to start, especially with the HSA. Because it rolls over, I would tend to add more than you think you might need this year b/c you won't lose the money and it's better to have it in there then have to pay out of pocket, besides, inevitably, things to do come up!

We have 5 kids and we put away $5000 a year.

Our HSA rolls over each year so we don't lose it, we accumilate it.

I have 5 kids and we use it for all co-pays two with a one year old you will still regular checkups for immunizations over the next year are those covered or you do have co-pays? Once you figure all that out then you have an approximate amount you put in. For ours we can use it for contacts and glasses too. So it can add up and it is pretax for us so we save some money in the long run.
J.

You have to think about a couple of things here. First, you need to know if the money in the HSA expires or if it gets rolled over to the next year. A few years ago we had one that did not roll over and all the money that was in there was lost at the end of the insurance year. Since we were healthy and didn't go to the doctor often, we didn't put any money into it. Now it has changed and everything in the account gets rolled over to the next year. Also, the employer puts around $1000.00 per year into it. In a normal year, that employer money is enough to cover for the doctor visits during the year, prescriptions, etc. so we don't put anything extra into it. Last year, however, I had a breast biopsy (it came out all negative) and had a lot of bills. When I realized that there would be a lot of bills coming in, I payed a lump sum into the account and then paid all the medical bills from that account instead of our regular checking. It is a good idea to pay any medical expenses from the HSA because all the money you put in there you can deduct from your taxable income.
Some plans have a maximum out of pocket amount per year. In our case it is 5000.00. You could use that amount as the level of money you want in there, just so that it is saved up in case somebody gets seriously sick. But once again, if you put that much money into it you want to make sure that it is an account that gets rolled over into the new year.

for a family of 5 we put in $5,000/year and with that never have anything left over. ours does NOT roll over as I was told no HSA rolls over. its a use it or lose it deal. But,I dont know everything about ins. so maybe there is something new out there. roll over would be nice.

We don't have money taken out of hubby's paycheck. We set up the account with a bank, and when we need more, we put more in the account. It's hard for us to know how much...I'm pregnant, so we keep getting bills for ultrasounds and blood tests, and my daughter had a trip to the ER for $700. ouch. Not sure if you have the option to fund it more in the event of need like we do, but it's worked out well for us.

We go to the doc a lot, and I just had a baby, so ours was quite high. I would look at last year's out of pocket costs. The benefit is that you get this tax free. The backlash is that if you don't use it, you lose it.

HSA's (Health Savings Accounts) DO rollover. FSA (Flexible Savings Account) usually DO NOT. Since we are able to roll it over, I think we put about $5000 in ours. Now having said that, we are like you, rarely sick and $2200 sounds like plenty, but you just never know.
Your kids are young, so you don't know about an accident or unexpected illness. Our soon to be 16 year old old needed glasses. But because she is a softball pitcher we also got her specialized contact lenses in addition to her glasses. It was nice to have the extra $ available.
Our son, then 19, woke us up in the middle of the night in horrible pain. Because DH and relatives on BOTH sides of the family have histories of kidney stones we took him to the ER. Unexpected visit that ate about $1000 out of the HSA

I am thrilled with the opportunity to have an HSA! Again, like you, we are over all healthy. But it also makes me look and think harder about prevention and the utilization of our resources.

edited: My understanding of HSA's (or at least ours) it is to cover those otherwise out of pocket costs up to a certain point. Once your hit that deductible (just like any other insurance but higher with HSA) your insurances covers at a higher rate. Of course it all depends on your policy and how the policy was written and brokered to your employer.

I know it sounds cliche, but things are different now. When I first started my nursing career, I had fabulous insurance. AND since I was an employee when I had my kids (16 and 20 years ago) they covered extra so my 'out of pocket' was just 5% Then when I left the hospital and worked in a lung specialists office, I had the same insurance they had for their families which was amazing. When I quit working and went to my husband's insurance, he was an executive with an international company. Again, fabulous coverage. BUT, when he got sick of corporate BS and moved to a smaller company, it was about the same time I started looking at health and wellness differently. It also opened my eyes to the games (just for a lack of a better word, no offense meant) that is played between insurance and hospitals and doctors. When I went in for my physical and explained to my doctor that I now had an HSA she treated me as a "private pay" and it completely changed the billing. ONE test she would have billed $200 to my insurance company because of the deductible and discount process. But to charge me it was $25!
Insurance is there for a reason, major illness or catastrophe. But since I am now kind of an out of the box thinker (chiropractor now before MD) I like my out of the box option.

HSA's do not roll over. If you do not use the money, you lose it at the end of the year.

I'm not personally a big fan of HSA's. My employer offers one, and thank goodness my husband's offers a traditional PPO account. I find my colleagues who are covered by the HSA tend to blow off what they consider minor illnesses so they don't have to pay out of pocket.......bad idea because a sinus infection can easily turn into bronchitis and pneumonia which require much more intensive/expensive treatment.

Here are my 2 cents from personal experience......

2 days before my 33rd birthday, 10.5 weeks postpartum, with NO symptoms I was diagnosed with cancer -1 doctor missed it, another was "slightly concerned", it took 3 pathologists to diagnose over 4 weeks. The only way we found it was a small, pea-sized nodule near my collarbone. My treatment, follow-up, etc. has cost well over $400K that has been covered almost entirely by insurance. Mine was a relatively easy to treat cancer (so far) that used older chemo drugs to treat.

Put as much as you can afford into your HSA - there is NO way to predict what may happen, and medical costs are the #1 reason for personal bankruptcy in the US right now.

The advice to check to see how much can be rolled-over is a great one. You don't want to lose money, but you also want to prepare for the "just in cases" in life.

Good luck with your decision. Even though we have great insurance coverage currently, we still put at least $1500/year into our flexible spending account to cover copays, deductibles, etc.

I have NEVER heard of an HSA which allowed you to roll over the money YOU contributed from year to year. Every single one has been a "use it or lose it" situation.

We have used this kind of account in the past and I really liked it. I would sit down and estimate (conservatively) what expenses we'd have for the up coming year, just like you have done. Even if they are telling you it rolls over I would try to estimate low. It's better to pay directly out of pocket (it comes out of your pocket either way) rather than put money away that I lose at the end of the year!!