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Use Your HSA Dollars Wisely

Health savings accounts (HSAs) cover about 25 million Americans—roughly five times as many as 10 years ago. Combined with a high-deductible health plan, HSAs permit you to save money for your current and future medical care expenses on a tax-free basis.

You can keep these funds when you retire, so it’s easy to focus more on saving than spending. But when saving money means foregoing necessary health care, you could be jeopardizing your health and well-being, as well as your financial future.

Smart spending is the key:

  • Comparison shop. For example, if your health care provider prescribes an expensive brand-name medication, ask if an over-the-counter (OTC) or generic medication might suit your needs just as well.

  • Avoid unnecessary care. Do you really need that expensive medical test your provider suggests? If the results won’t affect your treatment decision, the test probably isn’t necessary.

  • Spend on prevention. Most HSA plans cover preventive care, such as annual physicals, immunizations, well-child care, or mammograms, without requiring that you meet a deductible. Even without that incentive, be sure to invest in such care. It can save you from major, high-cost health problems down the road.

  • Don’t skimp on essential medications. Many people make the mistake of not filling prescriptions for medicines that can keep their blood pressure or cholesterol under control, for example. Others take lower doses than their health care providers recommend. Skimping on your meds may save you money today, but at a serious cost to your long-term health.

  • Be proactive about seeking treatment. If you know you have heart disease and you start having chest pain, don’t nickel-and-dime the decision to get to the emergency room. If you have a persistent headache, cough, fever, infection, or any other worrisome symptom, chances are that paying for a doctor’s visit now will save you countless future headaches.

And keep on saving while you’re spending. Just one emergency room visit for a broken bone can cost thousands of dollars out of pocket. Aim to contribute enough to your HSA each month so you’ll have the funds on hand for any health care expenses—expected or unexpected—that could come your way.