When you are worrying about the costs of paying your daily bills and putting food on the dinner table, the cost of health insurance and auto insurance may seem like “extras” that you simply don’t have the money to pay. Research illustrates though, that individuals who have high-deductible medical insurance plans (those most associated with health savings accounts or HSAs) use health medicine more often—and thus are a bit on the healthier side than those without insurance or with other types of insurance plans.
High-deductible Health Insurance Plans
Self-employed individuals, business owners and employees not insured by employers can opt to take care of their health needs with an individual health insurance policy. In order to make the monthly premiums more affordable, the plans have high deductibles. These high-deductible insurance plans do cover wellness exams without requiring the insured person to meet their deductible first. As an added bonus, the insured can choose to establish a special health savings account to pay for medical and health expenses that are not covered under the insurance policy.
Not only do these high-deductible health insurance policies encourage the holders to take care of their health, but the health savings account can offer some tax benefits as well. The amount of money you save in the health savings account earns tax-free interest. As long as you use the money you build up in the savings account to pay for medical and health expenses, it is tax-free money to you.
You can use the health savings account money to pay doctor and prescription drug co-pays; to buy over-the-counter medications and even to pay for procedures such as Lasik eye surgery that may not be covered by your insurance provider. All in all, these plans seem to fill a need and build healthier individuals than allowing self-employed and uninsured individuals to go uncovered.
