There is little doubt that the United States is going to go through a tremendous health care crisis over the next 25 years. 42 million baby boomers have begun reaching age 65 and over the next 20 years they will all be eligible for medicare. Can you imagine what the tab is going to be when all these people have cancer treatments, heart bypass, organ transplants, knee and hip transplants along with all the other needs that today’s elderly have available to them.

should all these treatments be done? In 2008 alone, medicare spent $55 billion just on Doctor and Hospital bill for patients who were dying. Up to 1/3 of these treatments made little or no difference according to experts. Nearly all people say they would like to die at home but in reality 3/4 die in a hospital room or nursing home. Those in ICU can cost $10,000 per day and most are so heavily sedated they hardly know where they are anymore. Have you visited a nursing home lately? It’s sad to see so many heavily sedated people being herded around like cattle to be fed, eliminate and cleaned up. Many have no social life and are sedated so they won’t cause any problems. What a way to live.

We are already seeing the cost of health insurance skyrocket as more people enter an already crowded system. This is the first reason to have a Health Savings Account – it will lower your health insurance costs. If you get a high deductible health plan that goes along with your HSA you can save a couple hundred dollars per month on premiums. A family that goes onto this type of plan can save even more! If you have one of these plans at work you can deposit up to $3100 per individual ($6100) for family per year using pre-tax deductions. If you put in the money yourself using after tax dollars then you simply deduct your contributions from your taxes.

The Second reason to open an HSA is to use tax deductible funds to pay for other health care items that may not be covered by your insurance. These can include your dental care, eye care, orthodontist and any other type of primary care. The funds in your account can be used for all HSA Qualified Medical Expenses so it can be great when you need something done.

The 3rd reason to have a Health Savings Account is because when you do turn 65 and go on medicare then the funds in your HSA become the same as other IRA funds. In other words, this will be extra money for your retirement!

To Recap, you can save a significant amount of money by moving to a HDHP instead of your current health insurance.

The money is pre-tax or tax deductible depending on whether you or your employer makes the contribution.

You can use the money for dental work, eye care or any other form of qualified medical expense. There is no tax due on any money used for medical related expenses.

When you are 65 you can use anything left over as an extra source of retirement funds.

If you haven’t thought about it before you may want to do a quick online search to see how much a high deductible health plan might save you! It could be a very profitable decision.