HSA (Health Savings Account) plans might offer the best value for self-employed individuals. They combine a high deductible major medical plan with an interest bearing savings account that is funded with pretax money.

These plans have replaced MSA plans.

You can use the savings account funds for almost any type of medical expense without worrying about networks. Money contributed to a Tennessee HSA plan is exempt from both Federal and State taxes, like an IRA, and accumulates interest on a tax deferred basis, like an IRA. Unlike an IRA, the exempted funds in a HSA plan can be used immediately for any qualified medical expense. This includes doctors, dentists, prescriptions, psychotherapy, chiropractor, etc. You can even pay for your long term care insurance with tax-free money.

The Health Savings Account has essentially have two parts.

First there is a high-deductible major medical plan. Once you reach the deductible (as a family if it is a family plan) all eligible expenses are covered 100%.

The other part of the plan is the actual savings account. The money you put into this account earns interest and rolls over from year to year. It is always your money, whether you keep the insurance or not. When you are 65 you can take the money out and pay tax on the interest (like an IRA). Remember, the money you put into your HSA plan is available immediately for medical expenses.

Let me give you an example. I will use the 37215 zip code and a family with a 38 year old husband, 35 year old wife and two children. I will assume a 30% tax bracket and self employed.

The plan has a $5100 deductible. But this is for the whole family not per person. After the deductible is met, everything is covered 100%.

Monthly premiums are $268
They put in the maximum into their health savings account which is $425

The tax deduction for the premium is about $80 a month

The tax deduction for the savings account is about $127 a month

So, they have $207 a month in deductions and the premium is $268. The net cost of insurance is $67 a month and they end up with $5100 in their interest bearing savings account.

Now you can see why we love these plans.

Tennsessee HSA plan advantages:
- Reduces your health insurance premiums
- Allows you to use pretax money for medical expenses
- Permits you to pay for long-term-care with pretax money
- Doesn't restrict you to any networks
- Money does not disappear if not used

Everyone should consider this type of plan. It is not sold by all health insurance agents and you should talk to an HSA Specialist. Call us at 1-800-986-4786 for details (or click on the link at the top of the page).

CALL US AT 1-800-986-4786

or

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Serving Nashville, Memphis, Knoxville, Oak Ridge, Murfreesboro, Clarksville, Chattanooga and all other Tennessee cities.
1-800-986-4786
info@tennessee-insurance.com

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