» PPO And HSA Health Insurance Options Explained - Healthshare

PPO And HSA Health Insurance Options Explained

We all want to save money so we make use of discount coupons to save on our groceries and other personal items. Did you know there is also a health insurance plan that offers discounts on medical expenses?

PPO health insurance plans offer substantial discounts when it comes to medical care services even if you have not met the plan’s deductible. PPO or Preferred Provider Organization is a type of managed care wherein when you select doctors and other health care providers from the in-network provider list, you benefit from the insurance company having negotiated for lower rates.

Another good thing about PPO health insurance is that if you need an out-of-network doctor, you still have some coverage. But, you will have higher out-of-pocket costs. That’s not usually true with HMO plans, which are another form of managed care. They typically restrict coverage to their own network unless you need emergency care. Almost 80 to 90 percent of PPO health insurance plans are accepted by medical facilities nationwide.

There are also certain PPO plans with high-deductibles that allow you to start a Health Savings Account (HSA). The funds placed in the account can be used to pay for qualified health care expenses not covered by your insurance policy. Whether you withdrawal HSA money to pay for qualified medical purposes or let the balance grow with untaxed earnings, you can claim a tax deduction when you file income tax returns. However, you are only allowed to make HSA contributions until you enroll in Medicare. When you turn 65, you can use HSA funds to buy a car or spend any way you like. If you spend HSA money for anything other than qualified health care before you are 65, you will incur a 20-percent penalty.

Simply placing funds in the account can help you reduce your taxable income because you can claim an “above-the-line” deduction. Unused HSA funds don’t have the “use it or lose it” feature of Flexible Spending Accounts, either. The balance rolls over every year so you can still access the funds even when you retire. Check which high-deductible PPO plans allows you to start an HSA so that you can save money year after year.

Wiley Long

Wiley Long

Wiley Long is President of HSA for America, and a passionate advocate for consumer-based solutions that will improve price transparency and lower health insurance and medical costs for people purchasing individual and family health insurance plans.
Wiley Long

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  • Jennifer Darn

    Wiley, why does all this have to be so complicated? Our health care system would definitely improve if someone – like yourself – could boil it down into simple terms for the average person. Insurance companies certainly don’t. 🙁

  • Stephanie

    Thanks Wiley. HMO? PPO? HSA? It’s an alphabet soup. Why does health care have to be so complicated? Thanks for taking the time to explain it all.

  • Wiley Long

    Hi Jennifer,

    Yes, you are right, it is often much more complicated than it should be. One page that is popular on our site and answers a lot of questions is the FAQ page, http://www.HSAforAmerica.com/faq.htm.

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