How a Health Spending Account Works Employee health benefit costs are constantly on the rise. It seems that each few years, companies are seeing double digit percentage premium hikes. While large companies can absorb some of these added costs, the average small business is being forced to find new ways of reducing their healthcare expenditures. In an age where every penny counts more than ever, a health spending account (HSA) is becoming a more popular choice amongst the savvy business owner. An HSA is one of way the small business can keep up with the rising cost of their employees health benefits. Just incorporating an HSA into its group insurance benefits will allow the small business to lower costs and add flexibility to their packages. On its most basic level an HSA means the Canada Revenue Agency will allow your business to set up a "trust account" for the employees/owners of that specific business. An added benefit of an HSA it that it is tax free. The limitation of this account is that the money can only be spent on health care related costs. The biggest benefit granted to the business who sets up an HSA is complete flexibility. You can choose whatever number you want your business to contribute to this account per employee. You can also easily establish different categories of workers and coverage. The benefit to the employee is they can choose where this money is directed. They aren't locked into a certain number for any one category of health cost. If they want to spend more on prescription drugs than they do on eye glasses they can. This eliminates the waste of some group insurance policies. In some policies if a person doesnâ€™t use their eyeglass allotment for example, they just lose out on that money. With an HSA you can eliminate those lost benefits. If you own a small business and want to be able to offer attractive benefit packages like the "big boys," then a health spending account (HSA) is the perfect choice to either replace or supplement your current group insurance. Talk to your insurance broker today to find out how they can help you set up an HSA for your business.
For more information, visit our website, http://www.thebenefitguys.ca/