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More and more employers are looking for ways to reduce the cost of their medical benefits. Many find these cost reduction by using a Health Savings Account (HSA) and/or a Health Reimbursement Account (HRA).
Health Savings Accounts allow contributions by both employers and employees to a savings account from which medical expenses are paid. The money contributed to this savings account is pre-tax. The account belongs to the employee. The employee may pay medical expenses from the savings account without tax consequence. If a balance exists in the account when the employee retires, the funds may be drawn as retirement income. A High Deductible Health Plan is required with an HSA.
Health Reimbursement Accounts allow an employer to set aside funds for each employee to use for medical expenses. An HRA is general used in conjunction with an increase in the medical plan deductible. The HRA funds are used by the employee to cover some or all of the increase in the deductible. HRA funds belong to the employer.
The Susan Posada Agency will do the feasibility study, plan design and provide resources for documentation and administration.
For more information go to:
http://www.treas.gov/offices/public-affairs/hsa
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