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Open a Health Savings Account (HSA) in 3 Easy Steps

January 1, 2010

 

Step 1 - Make sure that you are eligible

Step 2  - Update your health insurance 

Step 3 - Open a HSA deposit account  


STEP 3.  Open an HSA Deposit Account

A HSA SAVINGS ACCOUNT IS OPENED AFTER THE QUALIFYING INSURANCE IS IN PLACE- If MedSave.com handles your qualifying insurance, this step is handled automatically and so you do not need to do anything.  Otherwise, you can open a health savings account at any time after the HSA-qualified insurance is issued.  Just complete and mail the short application form with the initial deposit and fee if applicable.  The following chart shows the HSA account fee schedule.  At this time, the procedures are the same for individuals as group health insurance plans.

  Insurance through MedSave.com All Other Insurance
Individual/Family Plans no fees for basic account features, account is automatically opened after insurance is issued fees as stated on the application form, must submit separate written application.  See the account descriptions and forms at www.healthsavingsaccount.com
Group Insurance Plans

 

Other Helpful Tips:

See the Frequently Asked Questions page at www.healthsavingsaccount-hsa.com for more information on many of these issues.

For maximum savings, the HSA plan should be combined with a PPO discount savings plan to cover medical, dental, Rx and vision expenses.  These plans can be used as an add-on to any existing HSA or other health plan.  See www.ehealthdiscountplan.com for details.

The term "basic HSA account features" is used to describe a health savings account with a bank savings account or money market account as the only investment options.  

The term "expanded HSA account features" include access to other investments including no-load mutual funds, stocks and bonds.  This information comes directly from the HSA administrator.  Fees for investments are handled separately from the HSA account administrator and would be the same as any similar investment account.

While this debit card feature can be convenient, it is our experience that this feature may create bounced payments with substantial fees if the owner does not carefully manage the account balance.  For example, sometimes a doctor's office submits a debit claim to the custodial account without communicating clearly to the patient and this creates the possibility of dishonored payments and additional fees.  For this reason, we suggest that most customers should use a manual withdrawal process.  See the article titled "Debit Cards Problems in Small Business Health Plans" at www.KymberlyMorrison.com for more discussion of the problems with debit cards.

All account details are listed in the custodial agreement attached to the account application.  

The omission of detail about HSA investment options on this Web page is intentional in order to comply with securities law pertaining to the "selling" of investments.  If is fair to assume that the investment issues, rules, services and procedures that apply to IRA accounts also apply to Health Savings Accounts.  The investment option details are made directly by the plan administrator to HSA account owners after the insurance is issued and basic HSA account is established..

When making deposits to HSA accounts, MAKE CHECKS PAYABLE to the plan administrator only as stated on the APPLICATION form.

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