Health Savings Accounts (HSAs) are becoming increasingly popular among certain demographics, particularly among the self-employed. Typically, HSAs go hand-in-hand with high-deductible, sometimes called “catastrophic,” insurance policies. These plans allow you to pay a lower premium in exchange for having a higher annual deductible. You may then put a limited amount money in a tax-free banking account for future approved medical expenses. An individual may put up to $3,050 in their HSA in 2010, while a family may contribute up to $6,150.

What happens if your medical expenses exceed the amount of money you have in your HSA? You’ll have to cover them out of your own pocket, until you reach your deductible. Then, your insurance plan will take over.

Of course, if someone else is responsible for your illness or injury, they may be responsible for picking up the tab on your health costs. For example, if you are in an automobile accident in which another party is determined to be at fault, you may not need to access the funds in your HSA at all. In many cases, the responsible party will be responsible for paying for the cost of your treatment and care.

What if the person responsible for your injury is uninsured, or underinsured? Check out your own automobile policy. Uninsured motorist coverage is required in New Jersey, but not in Pennsylvania. However, many Pennsylvania drivers do carry it. If you carry uninsured/underinsured coverage on your own policy, the coverage will pay for damages caused by a driver with less insurance.

Sometimes, particularly if there is any disagreement about whose fault the accident is, the insurance company will attempt to reduce what it pays for. If this happens, be sure to talk to an attorney who specializes in car accidents right away. He or she will be able to help you get what you deserve from both the driver’s insurance company as well as your own, so you can get on the road to recovery as quickly as possible. Contact Console and Associates P.C. today for more information.