| A health savings account is a tax-free | | | | low-cost, high deductible health insurance |
| savings account similar to an individual | | | | policy. The amount that is not used to pay |
| retirement account. It is designed | | | | bills accumulates and continues to collect |
| specifically to pay for medical expenses. | | | | interest according to the plan. This amount |
| These expenses are wholly tax-deductible for | | | | keeps growing in the account, year after |
| self-employed account holders. Cash from | | | | year. The amount maybe used as additional |
| these accounts can be withdrawn effortlessly | | | | income during retirement.Account holders have |
| by using a check or debit card. It | | | | the option of splitting the money presently |
| facilitates payment of routine medical | | | | spent on a sky-high conventional health plan |
| expenditures with tax-free money.President | | | | by putting a fraction of it towards a low |
| Bush signed the new health savings account | | | | cost higher deductible policy and depositing |
| legislation on December 8, 2003. The new | | | | the rest into a tax-deductible health savings |
| policies are designed to cater to modern | | | | account. This account should be used to pay |
| needs. Even though some features of the plan | | | | small everyday medical expenses. In case the |
| are the same as the initial one, there have | | | | money in this account is not enough to clear |
| been some significant modifications. These | | | | the bills, the high deductible insurance |
| include lower deductibles and options wherein | | | | policy can be used to help repay outstanding |
| up to 100% of the amount deducted may be | | | | medical bills.The principle idea to open a |
| contributed to a health savings account. | | | | health savings account is to substitute a |
| Moreover, the new plan is designed in a | | | | conventional health policy. These plans are |
| manner wherein almost everyone qualifies to | | | | more flexible and permits people to select |
| be an account holder.Substantial everyday | | | | their own physicians without being bound to |
| medicinal expenditure may be paid for by a | | | | restrictions imposed by other medical plans. |