Healthcare and insurance costs continue to rise. Addressing the healthcare crisis is important to each of us as individuals, and is of special concern to employers who wish to provide maximum protection at minimal cost to their employees.

The Unity National Bank Health Savings Account (HSA) has been created to provide a solution to these issues.

In January, 2004, the Medicare Reform Act was passed, allowing HSAs as federally approved, tax-exempt savings accounts designed to work in coordination with a qualified, high-deductible health plan. The savings account/ health plan combination reduces insurance premiums and allows employees to pay deductibles and qualified medical expenses with tax-free dollars.

How our HSA Savings Account works:
Employers and employees can make tax deductible contributions to an HSA up to limits established by the act: $2,600 for individuals and up to $5,150 for families. The money in your HSA earns interest tax-free and may be rolled over, if not used, from one year to the next. Under HSA plans, the health plan itself covers major medical expenses such as accidents or serious illness, while routine medical expenses such as physicals, are paid from a person's HSA.

Who is eligible to have an HSA?
An individual must be covered under a qualified High-Deductible Healthcare Plan (HDHP ) to participate in an HSA plan. Also, the person may not be receiving Medicare benefits and may not be claimed as a dependent on another person's tax return.

Benefits to the employer:

• Lower premiums
• Tax savings
• More cost-conscious employees

Benefits to the employee:

• Control and flexibility
• Portability
• Tax savings
• Investment growth

Additional benefits:

• Catch-up HSA contributions are permitted
• Can be used for future medical expenses
• HSA funds can be used for non-qualified, non-medical expenses, although withdrawal of funds for these purposes may be taxable and subject to penalties

The Unity National Bank Health Savings Plan:

• $100 minimum to open
• Balances $500 and up earn premium, tiered interest based on balance
• $25 annual fee; fee waived when you set up automatic transfer from an UNB checking account for HSA deposits

Want to know more?
Just talk with us today at any of our convenient locations.

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