Small Project Practitioners

I beg to differ. Health Savings Accounts are NOT the answer. First: there is a limit to the annual contribution, which can often be less than the annual medical expenses. Second: there are very few financial institutions that offer HSA accounts. Third: Banks and insurance companies that do offer HSA accounts give very low interest (a fraction of 1%). Fourth: There is typically an annual account fee that offsets any earnings. HSA's benefit insurance companies and bankers, not patients.

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Robert Matschulat AIA
Architect, Educational Facility Planner
edutecture, LLC
Lakewood CO
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I never liked the "Use it or lose it" mentality that I had to guess my family's health spending for the year and if there was anything left over I would lose it.   Buying eye glasses in December just to spend down my surplus seemed foolish.  Plus my tax bracket never changed substantially by having an HSA.
Frank

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Frank Marshall AIA
Architect
SMB&R Inc
Camp Hill PA
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Show Original Message -------------------------------------------
Original Message:
Sent: 10-24-2012 10:05
From: Robert Matschulat
Subject: AIA Dental Plan

I beg to differ. Health Savings Accounts are NOT the answer. First: there is a limit to the annual contribution, which can often be less than the annual medical expenses. Second: there are very few financial institutions that offer HSA accounts. Third: Banks and insurance companies that do offer HSA accounts give very low interest (a fraction of 1%). Fourth: There is typically an annual account fee that offsets any earnings. HSA's benefit insurance companies and bankers, not patients.

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Robert Matschulat AIA
Architect, Educational Facility Planner
edutecture, LLC
Lakewood CO
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I have a counterpoint to Robert below.

An HSA really depends on your situation. My family and I are young and healthy. We have an HSA. I can either be guaranteed to spend over a thousand dollars a month on 'traditional' health insurance or I can spend a few hundred on a high deductible plan with HSA with all dollars I put into it being pre-tax from the beginning. Check-ups are free and once I hit my deductible 100% of everything is paid for.

With traditional insurance you are guaranteed to pay X plus co-pays. With an HSA I am guaranteed to pay approximately 0.3(X) + out of pocket expenses. We only maxed out our deductible one year due to an exciting pregnancy. Even then, when accounting for co-pays and the hospital admission fee on a traditional plan, we were still ahead of the game. 

My family doesn't use hundreds of dollars a month in health insurance. We have enough money in the account to cover the deductible, buy miscellaneous health related items (again, with 100% pre-tax dollars) and then some. I am saving thousands of dollars a year with an HSA - which outweighs the low interest rate.

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Anthony,AIA
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Show Original Message -------------------------------------------
Original Message:
Sent: 10-25-2012 07:58
From: Frank Marshall
Subject: AIA Dental Plan

I never liked the "Use it or lose it" mentality that I had to guess my family's health spending for the year and if there was anything left over I would lose it.   Buying eye glasses in December just to spend down my surplus seemed foolish.  Plus my tax bracket never changed substantially by having an HSA.
Frank

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Frank Marshall AIA
Architect
SMB&R Inc
Camp Hill PA
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Original Message:
Sent: 10-24-2012 10:05
From: Robert Matschulat
Subject: AIA Dental Plan

I beg to differ. Health Savings Accounts are NOT the answer. First: there is a limit to the annual contribution, which can often be less than the annual medical expenses. Second: there are very few financial institutions that offer HSA accounts. Third: Banks and insurance companies that do offer HSA accounts give very low interest (a fraction of 1%). Fourth: There is typically an annual account fee that offsets any earnings. HSA's benefit insurance companies and bankers, not patients.

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Robert Matschulat AIA
Architect, Educational Facility Planner
edutecture, LLC
Lakewood CO
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Frank,

With a HSA you do not lose anything at the end of the year.  It smiply rolls along and grows as you do not use it.  Also, for now it grows tax free.

@Robert,
Yes there is a limit to the annual contribution but like I said if you are not a family with continual health issues then then the annunal contribution is more than enough to cover the deductible for any given year.  Then it rolls over to the next year and just continues to grow.
I don't know what is up with the financial institutions in your area but every single financial institution in our city offers HSA accounts.   We have national chains Bank of America, SunTrust, etc. to local owned and they ALL offer accounts.
Yes the interest is low to begin with but once our account obtains a certain value then we have more options that we can invest in that pay higher dividends.   And what is wrong with any money gaining any dividends for yourself?  I don't get  this one.   So you would rather pay all your money to an insurance company and get none of it back or not grow at all?
We pay $4.50/account/month for our fee.  Wow! what an incredible amount to pay considering all the savings I am making because I can negotiate my own rates or use our health insurance plan rates whichever I choose.

Your statement that HSA is not the answer is simply untrue! My employees love it and it has worked out great for us to be able to keep our insurance premiums down so that my company can so far pay 100% of the employee and their spouse premiums and make the majority of the contributions to the individual HSA accounts.  Because our premiums are lower we were able to pay the premiums and contributions and still pay LESS than a straight health insurance premium!

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Wayne Oakley AIA
Architect/Partner
Studio Oakley Architects, LLC
Lebanon TN
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Show Original Message -------------------------------------------
Original Message:
Sent: 10-25-2012 07:58
From: Frank Marshall
Subject: AIA Dental Plan

I never liked the "Use it or lose it" mentality that I had to guess my family's health spending for the year and if there was anything left over I would lose it.   Buying eye glasses in December just to spend down my surplus seemed foolish.  Plus my tax bracket never changed substantially by having an HSA.
Frank

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Frank Marshall AIA
Architect
SMB&R Inc
Camp Hill PA
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Original Message:
Sent: 10-24-2012 10:05
From: Robert Matschulat
Subject: AIA Dental Plan

I beg to differ. Health Savings Accounts are NOT the answer. First: there is a limit to the annual contribution, which can often be less than the annual medical expenses. Second: there are very few financial institutions that offer HSA accounts. Third: Banks and insurance companies that do offer HSA accounts give very low interest (a fraction of 1%). Fourth: There is typically an annual account fee that offsets any earnings. HSA's benefit insurance companies and bankers, not patients.

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Robert Matschulat AIA
Architect, Educational Facility Planner
edutecture, LLC
Lakewood CO
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Health Savings Accounts (HSA) are not use-it-or-lose it.  The money that you put in the bank account is yours to spend whenever on medical (or dental) costs.

"Flexible Spending Accounts" are the spend-it-or-lose it ones.  Tax favored, but you have to guess your annual set-aside.  And, they're not ideal for the company, either, if an employee is terminated or leaves the firm partway through the year.  With FSAs, at any point in the year you can spend your annual amount -- firm has to pay you the amount, whether or not it has been deferred from your income yet or not.

Anything with a tax benefit is more beneficial to those at the higher tax bracket.

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Joel Niemi AIA
Snohomish WA

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Robert may not feel that HSAs are the answer, but I'd suggest that they may not be the answer for him.

As a former firm principal, who got involved with the annual health insurance renewals and grimaced each year as the "really good price we negotiated with the insurer" (as the broker would tell us) was only 10% each year, being able to offer HSA plans to our employees was a GOOD thing.

Yes, you can't contribute more than the deductible each year.  But, what you put in is tax-free to you, just like the premium paid by the employer is not taxed.  But, having a way to set money aside, and spend it later, is a handy thing.  Compare that flexibility to the un-flexible (must spend in each year, or lose it) "Flexible Spending Account". 

HSAs are best suited to young folks.  They can build up money in the account, and the high-deductible health insurance policy that goes along with it likely includes a few checkups, so you're not paying all of the expenses out of the account.

If you're an employee, and can cover yourself and family for $1000 a month with a HSA, or $1500 a month with a conventional plan -- well, what would you do with another $6,000 a year?

Another benefit is the fact that you can spend your HSA money on anything that shows up on the IRS's list of medical expenses.  Tax Free.  Your regular medical policy won't pay for everything on the IRS list, I can assure you.

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Joel Niemi AIA
Snohomish WA

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RE:

I beg to differ. Health Savings Accounts are NOT the answer. ....

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Robert Matschulat AIA