* If an employer is self-insured, meaning the employer sets the premiums and pays the claims, or the coverage offered is a health savings account (HSA) or an Archer medical savings account
(MSA), the employer or the plan administrator will be responsible for paying the tax.
Before January 1, 2011, consumers were able to use medical savings account
funds to buy O-T-Cs.
Determine the type of medical savings account
your plan will include.
436), which eliminates the provision in the Affordable Care Act (ACA) that prohibits the use of funds from an FSA (flexible savings account), HSA (health savings account), HRA (health reimbursement account), or Archer MSA (medical savings account
) from being used to purchase over-the-counter medications without a prescription.
Medical Savings Account
(MSA) represents an innovative and relatively seldom used mechanism of health care financing, in which individual savings for covering health care expenses are accumulated.
PPACA excludes the costs for over-the-counter (OTC) drugs not prescribed by a doctor from being reimbursed through a Health Reimbursement Account or health Flexible Spending Account and from being reimbursed on a tax-free basis through a Health Savings Account or Archer Medical Savings Account
. Increases the tax on distributions from a health savings account or an Archer MSA that are not used for qualified medical expenses to 20 percent of the amount used.
What is an Archer Medical Savings Account
(MSA) and how is it taxed?
The last tool in the CDHP "toolkit" is the financial component--a medical savings account
. CDHPs typically offer either HRAs or HSAs to assist members with the high deductibles.
One of the newly created offerings was the Medicare+Choice Medical Savings Account
(M+C MSA) program.
The contribution limits apply in aggregate to all HSAs held by an individual and must be further reduced by any contributions the beneficiary makes to an Archer Medical Savings Account
(accounts designed to pay the costs of routine medical expenses for employees of small businesses and self-employed persons).
A typical medical savings account
benefit package has a $1,000 upfront cash amount that can be spent on any eligible care by the recipient.