A Florida health insurance medical savings account (MSA) is used to pay for expenses related to health care deductibles and expenses. Medical savings accounts cannot be used with just any insurance plan. A dedicated high deductible health plan must be created and utilized especially for a medical savings account. Funds in the medical savings account are tax deferred and any contributions made to the account can be deducted on both your Federal and Florida State tax returns. Money in the account is withdrawn to pay for high deductible medical bills. Unused deposits are subject to a threshold. However, if this threshold is exceeded, funds can be rolled over and used after retirement.
Eligibility for a Florida health insurance medical savings account is required to participate. A Florida resident must either be self-employed or employed at a company with less than fifty employees to qualify for a medical savings account. When opening a medical savings account, the initial deposit should equal at least the amount of the deductibles in your high deductible health plan. Employers can also set up savings accounts for their employees. Instead of procuring a typical health insurance plan, the employer would buy the high deductible plan for the employee, and deposit funds into the employee’s savings account. The total funds for the high deductible plan plus the initial savings account deposit should equal the costs of purchasing a traditional plan.
Both deductibles and deposits have thresholds imposed by either the federal government or the State of Florida, to protect the policy holders from excessive expenditures, as well as to ensure the medical savings account is not illegally used on a tax free basis. Florida places limits on the amounts of potential deductibles both for individuals and families. Individual deductibles can be as low as $1700 and range to $2600. Entire family combined deductibles can span from $3450 to $5150. Deposit limits on Florida health insurance medical savings accounts for 2009 were $3000 for individuals and $5950 for families.
Funds from Florida health insurance medical savings accounts can be used for a variety of medical related expenses. Types of items that can be purchased using these tax-free deposit dollars include glasses or contacts, Braille supplies, and transportation costs to and from doctor’s offices. Medical, dental and vision services are also covered, as well as smoking cessation programs, weight control and obesity treatments. Well baby visits; pre-natal care and preventative screening can use pre-tax medical savings account dollars. Finally, alternative health care approaches, such as Ayurveda, acupuncture, aromatherapy and psychological services are also covered.