If you have, or are thinking about opening, a health savings account in 2012, there are a few changes you should know about. Many of these changes became effective in 2011, but all of them will affect you going into 2012.
- The minimum required deductibles have increased: One can only open an HSA if their health insurance policy meets certain guidelines. This year, the minimum deductible to qualify is $1,200 for an individual and $2,400 for a family. If your deductible is lower than those amounts, then you may not be permitted to open the HSA.
- Out-of-pocket maximums for 2012 have increased: In order to qualify for an HSA, your out-of-pocket maximum cannot exceed $6,050 for an individual and $12,100 for a family.
- For 2012, contribution limits have increased: In 2012, an individual may contribute $3,100 while a family can contribute $6,250. The catch up contribution for individuals over age 55 is $1,000. Contributions can be made until April 15th for the prior year.
- Penalties are going up: If you use your HSA funds for nonqualified expenses, you will be subject to a tax penalty of 20 percent. Only those 65 and over are exempt.
- Allowable over-the-counter expenses are changing: You may once have been permitted to purchase nonprescription, over-the-counter drugs and supplements such as aspirin, vitamins and cold medicines on your HSA account, but now that is not permitted. Insulin, first aid supplies and adult diapers are still allowed.
While it’s a good idea to maximize the tax savings and tax-exempt growth opportunities afforded by an HSA, it’s also important that you pay close attention to what is and isn’t permitted in terms of contributions and expenses, because having an HSA and using it improperly will cost you more in penalties than you will save. If you have questions about your HSA or your high deductible Dallas health insurance plan, give us a call at All About Insurance—we’re always happy to help!