Health Plans That Help Employers and Employees Save
*Pictured, IMCU Branch Managers: Matt Smith, Center Grove Branch, Samantha Carpenter, Franklin Branch, and David Early, Greenwood Branch.
Imagine if there were a way for employers to offer excellent healthcare coverage that costs less, give their employees more control over healthcare costs, and allow those employees to use what they don’t spend on medical costs to save for the future.
You don’t have to imagine, because there’s a healthcare option that does all that! It’s called the Health Savings Account (HSA), and when offered in conjunction with high-deductible health insurance plans, HSAs give employees an easy, tax-advantaged way to pay for medical costs. According to USA Today, more than 22 million Americans have enrolled in health plans that include HSAs.
Employees can use their HSA to pay for visits to the doctor, dentist, optometrist, or other medical professionals, and to cover the cost of basic tests that fall below their health plan’s deductible. HSA funds can be used for prescriptions, eyeglasses, and many over-the-counter medical supplies and drugs.
HSAs offer several tax advantages for employees. First, most contributions to an HSA aren’t subject to income taxes, so they reduce the employee’s taxable income. Second, any withdrawals from HSAs are tax-free if used for eligible expenses. Finally, any employee and employer contributions to an HSA that aren’t used for healthcare will stay in the account and continue to grow tax-free. Any amount that’s saved is available to cover future health costs. After retirement, HSA funds can be used to pay for Medicare supplement premiums, long-term care, and other costs that Medicare doesn’t cover. (Funds can also be withdrawn for other expenses, but those withdrawals may be subject to taxes.)
Employers like HSAs for several reasons. The total cost of premiums and employer contributions tends to be far less than that of traditional employer-provided insurance. Because HSA contributions are made from pre-tax income, they reduce the employer’s contribution to Social Security. In addition, studies suggest that employees who have HSAs make better use of preventive care, because they have financial incentives to do so. Healthier employees are more productive and have fewer absences. Plus, companies of any size can offer HSAs, giving smaller businesses an affordable way to offer high-quality health benefits that help them attract and keep good employees.
Indiana Members Credit Union offers one of the best HSAs around, with a great rate. It requires no minimum balance or initial deposit, there’s no monthly fee, and it includes a free IMCU Health Savings Debit Card and online and mobile banking. Employees can use the debit card to pay for qualified medical expenses and can withdraw funds at any ATM or IMCU location. In addition, IMCU will come on-site to answer questions your employees may have and to take care of opening their accounts, on the spot, saving time and resources.
If you’d like to know more about putting the many advantages of HSAs to work for your employees, contact Amber Coryell, Business Development Officer at acoryell@imcu.com.
*IMCU is not licensed to provide tax advice. Consult your tax advisor.