Health Care Budget
Every person tries to tilt toward enhancing their physical health. But when speaking about physical health improvement, we should also pay attention to your financial health, as well. The reason is the expensiveness of the healthcare services in the United States. Medicine in the States is not just expensive, but insanely expensive. Medical bills are the most popular factor in the bankruptcy of Americans. There is no way without health insurance if you live in United States. If you have any health problems more severe than a cold, you don’t have insurance, it’s cheaper “to die”.
5 tips to collect health care budget
Tip#1: MSA, HSA or FSA
In the United States, a medical savings account ( MSA) is a medical savings account program, usually associated with self-employed individuals, in which tax-deferred deposits can be made to cover medical expenses. Payments from the MSA are not taxed if they are used to pay for qualified medical expenses. The MSA must be accompanied by a high deductible Health insurance plan (HDHP). Payments from the MSA are used to pay deductible expenses in a particular year. The funds in the MSA account can cover expenses related to most forms of medical care, disability, dental care, vision treatment and long-term care, regardless of whether the expenses were paid through appropriate insurance or otherwise.
After performing the deduction according to the plan in a particular year, HDHP will pay for all remaining covered medical expenses in that year. If funds remain in the MSA at the end of the year, they can either be extended for the next year, or they can be withdrawn as taxable income.
MSA’s are similar to Health Savings Accounts (HSA), which were created as part of the Prescription Drugs, Medicare Improvement and Modernization Act of 2003.
HSA is a tax-advantaged member-owned account. It allows every person save pre-tax funds for future qualified medical expenses. You can invest in mutual funds tax-free—and funds never expire. It is accessible exclusively to those with a qualifying health plan.
You make pre-tax contributions to an employer-sponsored HSA, and your contributions are not taxable. You can withdraw tax-free amounts for medical expenses from your account at any time.
The limit on the annual contribution to the HSA account in 2017 is $3,400 for individuals and $6,750 for a family. If you are over 55 years old, you can additionally deposit $1,000 per year to the account. Contributions to the HSA are accepted until the last day for the payment of federal taxes.
The Flexible Expense Account (FSA) allows you to pay for medical expenses before taxes. Patients can contribute up to $2,750 per year, but if they do not use the entire amount, then part of it (up to $500) is transferred to the next year.
HSA vs FSA
|Traditional health plan||HSA-qualified health plan|
|Higher premiums||Lower premiums|
|Lower deductibles||Higher deductibles|
|Doesn’t cover premium payments||Cover premium payments|
|Funds expire||Funds don’t expire|
Tip#2: A healthy lifestyle – the way to reduce medical expenses
A healthy lifestyle is a lifestyle of an individual for the purpose of preventing diseases and improving health. To get started, you will need to plan your preventive healthcare such as:
- an annual physical survey;
- mammogram, etc.
These services are usually covered at 100% by most insurance plans, meaning financial savings for you.
Tip#3: Take care of your heart health
According to the World Health Organization (WHO), cardiovascular diseases are the leading cause of death worldwide. At the same time, one of the most common heart operations — stenting of myocardial infarction costs an average $6,55. Prevention is much cheaper, but it requires a lot of effort from a person.
To keep the heart and blood vessels healthy for as long as possible, WHO experts recommend reducing salt intake, eating more fruits and vegetables, including various types of physical activity in your schedule and getting rid of bad habits. In addition, it is important to avoid the appearance of chronic stress and excessive psychological stress.
Tip#4: Choose the insurance that covers the purchase of medications
Saving on diseases in the USA will not work either. When buying even the simplest cold medicine, you will be asked for a prescription that only a doctor can prescribe. Accordingly, with an “ordinary” cold, you will first have to go to the doctor, pay for an appointment, and then go to the pharmacy. In addition, the prices of medicines in the United States are as high as self-medication, but medical insurance can cover most of the costs of drugs.
Despite the fact that the United States has some shortcomings in the healthcare system, the government has been making more and more attempts to reform the system in recent years, including reducing public spending on medical services. This means that in the near future there are chances that the United States will become leaders in many global indicators in the field of healthcare.
Tip#5: Choose the right insurance option
When buying an insurance policy, you will need to choose the most profitable plan and category, as the final cost of your treatment will depend on it. The category determines what percentage of the cost of medical services will fall on your shoulders, and it depends on the plan whether you will be able to be treated in a medical institution of your choice without extra payments.
Regardless of the category of medical insurance and the plan, healthcare insurance policies in the United States cover the following types of medical services: outpatient treatment, emergency medical care, hospital treatment, pregnancy and childbirth support, treatment of mental health disorders, rehabilitation, clinical tests, treatment of chronic diseases, payment of medicines, services of pediatricians.
Other types of services, such as, for example, dentistry or ophthalmology, are not mandatory for inclusion in the plan, but some types of plans also cover optional services. There is also an opportunity to purchase a separate medical insurance, for example, for dental treatment, if you have a need for it.