Time for a Checkup?
How health savings accounts can ease your skyrocketing healthcare costs

If you’re like most spa owners, you’re fighting what looks like a losing battle against the oncoming tide of rising healthcare costs. To make matters worse, the bedlam now surrounding the issue of healthcare reform is likely only elevating your stress levels.

While it’s doubtful this problem will disappear no matter how the current scenario in Washington plays out, the Health Savings Account (HSA) legislation signed into law a few years ago will continue to offer you the possibility of making a dramatic reduction in your expenses. In their first year on the market, HSAs attracted thousands of individuals and business owners eager to escape the runaway costs of health insurance. Now, more than six million people are enrolled in HSAs. William Boyles, publisher of an insurance industry newsletter, predicts that 20 million people will sign up within the next five years.

In this story, we’ll discuss how HSAs work, as well as break them down for employers, massage therapists and estheticians alike. They’re just one way that healthcare can be more accessible for those who work to improve the well-being of others.

On December 8, 2003, former president George W. Bush established HSAs as part of the Medicare Prescription Drug, Improvement and Modernization Act. The law made HSAs permanent and available to everyone—individuals, business owners and employees. Data gathered by the healthcare providers’ organization known as America’s Health Insurance Plans indicates that 6.1 million people use HSAs—4.6 million as part of an employer- backed plan, and 1.5 million as individuals.

Here’s how they work:

First of all, HSAs come in two parts. The interested party—who must be younger than 65—
purchases a low-cost, high-deductible health insurance policy. Most plans are available through a growing number of providers, including such giants as Aetna, UnitedHealth Group, BlueCross BlueShield and Golden Rule Insurance. Money is no longer taken out of her paycheck to pay for healthcare, freeing up those funds.

Instead, she must then open a dedicated savings account (otherwise known as a HSA) in conjunction with the insurance policy. She then makes deposits in the HSA that aren’t subject to income taxes. Each year, she may set aside up to $3,000 if the account is only for her, or $5,950 if it’s meant to cover her family. She can then use that money to pay for medical care.

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