Health Savings Account Substitute for Arizona Small Business Health Insurance

Arizona small business health insurance plans that cover your employees without eating into your revenues is an imperative for your business today. Added to the cover it provides, it could actually determine the quality of personnel you hire and retain. But the fact remains that the rates for Arizona small business health insurances have been only rising for the past five years.

The Health Savings Account, enacted by the Congress, could be an alternative to your Arizona small business health insurance. For, to begin with, it actually cuts costs on the prevalent Arizona small business health insurance rates.

Current Wellbeing Exigencies in Arizona Small Business Health Insurance

Rates for employee benefits amongst Arizona small businesses are constantly rising. According to various surveys by underwriters across the nation, in the past few years the costs for employee wellbeing has risen by 15 percent annually. An average estimate of the cost borne by the employers for each employee's health policy is $700 per month. This, incidentally, outruns the percentage rise in inflation well as that paid in employee wages. Also, surveys point out that more and more small businesses now pay lesser for covering medical visits as well as prescriptions. Subsequently, approximately 47 percent of the small businesses across the nation grant no cover for their employees.

It is in this scenario that an HSA provides viable solutions that your small business can make use of.

Understanding Health Savings Account (HSA)

Health Savings Account is maintained at institutions other than your insurance company. A health savings account has two components to it. Firstly, it works as a high-deductible insurance policy. Secondly, it is a tax-exempted account. So, it ensures that your employee not only pays lesser in monthly dues, but also uses tax-free cash to cover routine or minor medical expenses.

How an HSA can Benefit your Arizona Small Business

An HSA is advantageous for both you as an employer as well as your employee.

Besides the advantages of tax-emption your employee benefits through the account, the unused amount in the account gets automatically carried over to subsequent years. Moreover, the interest your employee earns on the accumulated unused amount remains tax-deferred.

There is another interesting factor that could make HSA a popular option amongst your Arizona small business employees. The savings are owned by your employees. So, they can be carried on in case the employees leave your company. Additionally, an HSA contributes in making your employees health conscious.

And, in midst of all these, the advantage you as an employer would achieve by an HSA is that the contributions you make would remain exempted from payroll taxes. Such benefits make HAS a viable alternative to traditional Arizona small business health insurance plans.