Though Canada has a publicly funded medicare system, it can’t completely cover the healthcare needs of its citizens. Most Canadians have this difference covered by cost-effective, tax advantaged, small business health care plans, such as health spending accounts.
These health spending accounts are group benefits that provide employees with reimbursement for a wide range of health-related expenses. Under these HSA plans, people can claim any item or service that’s allowed under the Income Tax Act of Canada as a medical expense. For example, health spending accounts can cover vision care expenses, prescription drug expenses, paramedical practitioners, adult orthodontics, and more. HSAs are designed to cover the more routine medical expenses, such as teeth cleaning or prescriptions.
The biggest attraction of these HSA health plans is that they cover 100% of out-of-pocket health care costs for employees with 100% pre-taxed dollars. Essentially, health spending accounts provide an attractive option for small businesses that want to pay for their employees’ medical expenses and their families on a tax-free basis. This alternative healthcare plan allows business owners to deduct all their eligible medical and dental expenses from their gross business income, rather than having to make them a personal expense. Thusly, health spending accounts are extremely cost-effective healthcare solutions.
Employees with pre-existing medical conditions may have trouble joining other group insurance plans. Another huge benefit of these HSAs is that these employees are covered, with no age limit.
Health spending accounts are a great alternative for small businesses looking to cover their employees in the most cost-efficient way possible. If you have any questions, feel free to ask in the comments.