Health Savings Account Blog

September 01, 2010

Health Savings Account Deposits Top $1 Billion for Single Bank

United Health Group Inc., now one of the Twin Cities’ largest banks, has seen its OptumHealth Bank top the $1-billion mark for deposits on its books, and it's all due to Health Savings Accounts. By the end of June, its Health Savings Account deposits were at $1.025 billion. Chartered in Salt Lake City and part of Minnetonka-based UnitedHealth, UnitedHealth has helped thousands of employers to set up Health Savings Accounts for their employees.

There is a growing trend for employers to offer employees these tax-advantaged Health Savings Accounts in combination with high-deductible health care plans. The HSA plans typically keep premiums low, and employees can make tax-deductible withdrawals to pay for qualified medical expenses.

When Congress passed the Medicare Modernization Act in 2003 that allowed tax-exempt deposits and withdrawals for medical expenses for the first time. UnitedHealth opened its first Health Savings Account the very next year in order to simplify health care for its customers. The surprise is that UnitedHealth, with more than $1 billion in deposits, doesn’t even handle retail banking.

To keep you up-to-date on the future of HSA Plans, HSA for America maintains extensive resources to aide in establishing Health Savings Accounts and daily news updates at HSAforAmerica.com.

Posted by Wiley Long at 12:31 PM | Comments (0)

August 26, 2010

Can A Health Savings Account Help You Bridge Employment Gaps?

Health Savings Accounts may have been stifled by complex regulations, but these accounts can do much more than just turn your healthcare bills into tax deductions. With unemployment a constant threat, health savings accounts help people maintain coverage between jobs, and even into retirement.

Anyone under 65 can start a Health Savings Account once they buy a qualified high-deductible health insurance plan. That's an insurance plan with a deductible of at least $1,050 for individuals or $2,100 for families. These plans mush also have a limit of $5,250 for an individual and $10,500 for a family on their out-of-pocket costs.

HSA Plans have a great advantage over flexibility spending accounts for medical expenses because, unlike flexible spending accounts, HSA contributions and gains roll over from year to year. Any funds not used annually in a flexible savings account are lost at yearend or when employment ends. All withdrawals from a Health Savings Account must be for qualified healthcare expenses otherwise you face a penalty of 10 percent.

Health Savings Accounts are completely independent of employment so these funds can be used as a “safety net” when jobs are lost, or workers move to new jobs. After retirement, these accounts also offer another investment option with tax deductions on contributions, tax-free growth and tax-free withdrawals to pay for healthcare costs. There's just one caution once you retire: withdrawals to pay for something other than qualified healthcare expenses are still taxable after age 65.

To find out more about how HSA plans differ from flexible spending accounts, visit our website for information about health savings accounts and the high-deductible insurance plans that are qualified to work with them.

Posted by Wiley Long at 10:03 AM | Comments (0)

August 23, 2010

Health Savings Accounts: Why Have Ten Million People Enrolled?

As of January 2010, ten million Americans already have a Health Savings Account (HSA) and this form of tax-advantaged saving to pay medical expenses has only been available since 2004. Why are these plans growing so fast?

The number of people enrolling in a Health Savings Account increased by 25 percent since 2009. The fastest growing market for HSA plans was for large-group coverage, followed by small-group coverage. Thirty percent of those with an HSA were in the small group market, and 50 percent were in the large-group market.

Another 20 percent were individuals who paid for their own health insurance coverage. There are now 2.1 million people who have enrolled in HSA plans who pay for their own coverage.

You can learn more about Health Savings Accounts, the high-deductible insurance plans that work with them to keep premiums low, and how to reduce your taxable income with online resources on our website.

Posted by Wiley Long at 10:03 AM | Comments (0)

August 14, 2010

Health Savings Accounts: Why Are Customers Investing Record Amounts In Them?

J.P. Morgan Treasury Services manage more than 530,000 health savings accounts for people who have deposited a combined total of approximately $800 million nationwide. Health savings accounts are growing so fast because they allow individuals to save tax-free to pay their future medical bills.

At the end of 2009, 45 percent of J.P. Morgan's health savings account (HSA) customers held more than $1,000 in their accounts. That represented a 10 percent increase from the previous year.

The percentage of accounts that held more than $2,000 also went up from from 20 percent to 31 percent during that same time period. Last year, more than half (68 percent) of these HSA owners added more to their health savings accounts than they spent every month.

Health Savings Accounts have become integral to the effort to encourage us to become better healthcare consumers. These tax-advantaged accounts can be paired with certain qualified high-deductible health policies that keep premiums low by requiring individuals to pay the first $2,500 and families to pay the first $5,000 of their medical bills. Employers and employees can both contribute to an HSA tax-free, and those deposits can be used to pay for medical expenses until the deductible is met.

As long as health savings account funds are used for HSA qualified medical expenses, no taxes are paid. On Jan. 1, the penalty for withdrawing health savings account funds for non-medical purposes will be increased to 20 percent. Once you turn 65, you can withdraw without facing any penalty, pay the taxes and you're free to use your health savings account balance for any purpose. If you want to learn more about the advantages of health savings accounts, check out our website for breaking news links, strategies to set up an HSA and tips to get the greatest value from your HSA.

Posted by Wiley Long at 10:28 AM | Comments (0)

August 08, 2010

High-deductible Health-insurance Plans Attract Employers

Despite mixed reviews, the high-deductible health plans that typically keep premiums low and their linked health savings accounts are becoming increasingly popular with employers. With only minor changes from new healthcare laws, it's still cheaper for employers to provide HSA Plans to employees than to provide comprehensive health coverage.

HSA plans were created by a 2003 law that linked Health Savings Accounts to qualified high-deductible health insurance plans. HSA Plans allow people to increase savings with tax-free interest, and use the savings to cover deductibles and other medical expenses. Both employers and employees can deposit into these accounts, but the funds belong soley to the employee. That's very different from flexible spending accounts. With those, employees lose everything in the account they haven't used at the end of the year or whenever their employment ends.

The new healthcare laws did change the defininition of qualified healthcare expenses. As of January, you will not be allowed to purchase over-the-counter medications (aspirin, cold rememdies, etc.) with Health Savings Account funds unless a doctor prescribes these. Using a Health Savings Account for unqualified expenses will incur a 20-percent penalty, and that's double the earlier 10-percent penalty.

This change may be in response to a 2008 Government Accountability Office report that concluded the average household income of those with Health Savings Accounts was about $139,000. As a whole, taxpayers' average household income is only about $57,000. It seems that primarily higher-income households benefit from HSA Plans. Still, more employers are offering HSA Plans in attempts to replace comprehensive health insurance plans. Almost half of all companies with over 10,000 employees have already done so, and small-business owners are offering HSA Plans as well.

The new healthcare laws have also affected insureres. When nHealth of Richmond went out of business, it blamed new requirements that insurers spend 80 to 85 percent of the premiums they collect on clinical services and quality measures, or give customers rebates. News reports have suggested this claim was intended to obscure the fact that the company that was losing money before new regulations. Now, there may be fewer insurers in that area to offer HSA-compatible plans.

Posted by Wiley Long at 11:25 AM | Comments (0)

August 05, 2010

Health Savings Accounts: Do They Work With Low-cost Plans?

High-deductible health insurance plans, in general, offer lower premiums in exchange for the insured accepting part of risk. They agree to pay for their healthcare costs upto an annual deductible. In effect, they are putting a cap on their out-of-pocket expenses. The high-deductible health insurance plans that are qualified to be combined with Health Savings Accounts also offer lower-cost premiums.

Leading insurance companies (such as Assurant HSA and Golden Rule HSA) have rate guarantees for up to three years. That enables you to lock in premium rates long-term. Most plans inevitably raise rates so this can give you an advantage. If premiums do decrease, you can still move to a better HSA plan when it becomes available, as long as your health allows you to change plans without medical underwriting concerns over pre-existing conditions.

With much of healthcare reform still being decided, it may pay to lock in the HSA plans and the rates you like now. If the situation changes, you'll have the plan you preferred and you can still change should a better deal come to market.

Posted by Wiley Long at 12:54 AM | Comments (0)

August 02, 2010

Health Savings Accounts Work like Checking Accounts

If you’re worried that any savings account that lets you earn tax-free interest while making healthcare expenses tax-deductible has got to have a lot of complicated rules, here's what you need to know.

Health Savings Accounts are so popular because they are user-friendly and they don't nickel-and-dime you with add-ons. Some accounts include free starter checks, free Internet access for ACH electronic transfers and free debit cards. You don’t even have to maintain a minimum balance.

A Health Savings Account (HSA) can help you reduce your taxable income, and still give you tax-free interest like an IRA. Unlike flexible spending accounts where you lose all funds not used by yearend, your HSA funds just roll over from year to year to keep growing faster than most savings accounts with tax-free interest.

At HSA for America, you can learn more about the best way to get started with their convenient online HSA How To Guide. Their experienced Personal Advisors are also available at no cost to answer your questions. Just call HSA for America at 866 749-2039 and they'll be happy to set up a convenient time to discuss your questions.

Posted by Wiley Long at 10:34 PM | Comments (0)

July 21, 2010

Health Savings Accounts Are Still Popular after Healthcare Reform

All the recent changes in health care haven't reduced the popularity of Health Savings Accounts. In fact, employers are offering Health Savings Accounts more often as a less expensive way to cover employees. According to America’s Health Insurance Plans, more than 10 million individuals enjoy the tax-free interest and tax-deductible healthcare expenses that come with Health Savings Accounts.

Why are Health Savings Accounts appealing to more people? With the rising cost of healthcare, the high-deductible health insurance plans that work with these savings accounts typically keep premiums low. Preventive care and wellness check-ups are not subject to a deductible, though, so it's still easy to get physicals and mammograms. These types of exams are usually covered at 100 percent and do not require any co-pays.

These high-deductible plans also limit your out-of-pocket expenses, such as $5,950 per year for an individual or $11,900 per year for a family. Both employees and their employers can contribute to a Health Savings Account, and contributions are pre-tax.

Some argue that high-deductible plans keep people from seeing a doctor very often, but internal studies from major private insurers such as UnitedHealthcare, WellPoint, Aetna, and Cigna indicate that people with high-deductible health savings accounts exhibit better health habits than many people with more traditional health insurance coverage.

If you want to see what a Health Savings Account (HSA) can do for you, visit HSA for America, or give them us call at 866 749-2039. With their years of experience, they are the "go to guys" for Health Savings Accounts and they're happy to answer your questions and help you enroll with no charge for their services.

Posted by Wiley Long at 09:53 AM | Comments (0)

July 15, 2010

Health Savings Accounts Offer State Tax Deductions

Health Savings Accounts can give you generous tax deductions on your Federal income tax, but what about your state income tax?

States choose whether they comply with Federal guidelines for Health Savings Accounts, but most states do offer deductions. You can check your state HSA deductions to see whether your state allows deductions for contributions to Health Savings Accounts.

In addition to tax deductions, Health Savings Accounts can help you save on insurance premiums because they are combined with high-deductible health insurance plans. High-deductible plans typically offer much more reasonable premiums.

To save even more, you can find Health Savings Account insurance plans with less than 100 percent coverage. Get answers to all your questions about saving with Health Savings Accounts at HSA for America. Get started with their How To Find an HSA Plan guide, or schedule a no-cost consultation with a Personal Advisor. Just call them at 866 749-2039to set up a convenient time (including evenings and weekends) for personalized service.

Posted by Wiley Long at 09:30 PM | Comments (0)

July 13, 2010

Health Savings Accounts Are More Popular Every Year

If you’re looking for a way to lower your monthly health insurance premiums, take a look at what millions of other people have been doing. According to the Employee Benefit Research Institute, the balances in Health Savings Accounts have grown rapidly in the past few years. Consumer-driven health plans, including Health Savings Accounts and health reimbursement arrangements, grew to $7.1 billion last year. That showed an increase of $835.4 million in the last three years.

The number of these accounts has increased from 1.2 million accounts in 2006 to 5 million in 2009. What makes these plans so popular? Health Savings Accounts work with high-deductible health insurance plans. With a high deductible, you typically get a policy that has lower monthly premiums.

People can take what they save in premiums and invest it in their Health Savings Accounts to earn tax-free interest. In addition, they can get tax deductions when they withdraw funds to pay for qualified medical expenses.

Visit HSA for America to learn all about the benefits of Health Savings Accounts and high-deductible health insurance plans. You can also compare plans with our instant online quote engine.

For personalized service, just call HSA for America at 866 749-2039to arrange a no-cost, no-obligation consultation with one of our licensed insurance agents. They can answer your questions, and help you compare HSA plans. Find out why millions of people have already invested in Health Savings Accounts.

Posted by Wiley Long at 09:19 PM | Comments (0)

July 09, 2010

Health Savings Accounts Now Benefit Ten Million Americans

Ten million Americans are enjoying the benefits of Health Savings Accounts, according to a census released this May by America’s Health Insurance Plans. That’s 25 percent more people than last year.

Health Savings Accounts, which can be combined with lower-cost, high-deductible health insurance plans, provide an important coverage option for families, and small businesses.

In the individual market, 2.1 million are enrolled in Health Savings Account (HSA) plans, while nearly 3 million are enrolled in HSA coverage in the small-group market, and almost 5 million have HSA coverage in the large-group market.

To learn why Health Savings Accounts are growing in popularity, visit us at HSA for America. You’ll see why both employees and employers favor Health Savings Accounts. We’ll show you how to get started with our convenient online HSA How To Guide.

Our experienced Personal Advisors are also available at no cost to answer your questions. Just call HSA for America at 866 749-2039 to set up a convenient time to discuss your questions, and we can help you sort through HSA Plans to see which fit your needs best.

Posted by Wiley Long at 07:15 PM | Comments (0)

June 11, 2010

Health Savings Accounts Still The Best Bet With Health Care Reform

If you’re still debating whether the benefits of a Health Savings Account (HSA) can help you, check out the tax deductions, tax-free earnings, and the lower premiums of insurance plans that are qualified to be combined with a HSA soon.

The new health care reform laws may change the shape of these HSA plans in the future, but if you lock in premium rates and other benefits now, you’ll be able to keep your favorite plan for as long as it is for sale.

It you get the one of the best HSA plans for your needs now, you can compare it to newer plans as they are offered. You’ll have the chance to trade up, or keep your favorite HSA plan and high-deductible health insurance plan.

To compare these plans now and in the future, you can use our instant online HSA quote engine. We also offer no-cost, no-obligation consultations with licensed insurance agents to help you compare plans. Just click here, or call HSA for America at 866 749-2039 to get answers to your questions and advice from the experts.

Posted by Wiley Long at 12:47 AM | Comments (0)

June 06, 2010

Health Savings Account Owners Can Cut Their Bills Down To Size

As the owner of a Health Savings Account (HSA), you’re looking for ways to save more of your health care dollars. Here’s an easy, risk-free way to get big savings on your medical bills.

Insurance companies and big corporations have the power to negotiate with doctors and hospitals. In some cases, they pay only a fraction of what the general public is billed for an identical procedure. That’s something the average individual has not had access to until now.

Just click here to register for medical bill negotiation. Any claim with a patient balance over $200 is eligible to be sent for negotiation. Your bill will be analyzed in their geographic database. If the charges are deemed to be excessive, a trained negotiator will contact the provider, and propose a discounted settlement. If successful, they charge a percentage of the amount saved on the bill. If there’s no savings, there is no fee! That’s why it’s RISK FREE.

This is just one of several ways HSA for America can help you save on your health care expenses. Check out our website for other ways To save, or give us a call at 866 749-2039. If you’re just setting up your HSA, one of our licensed insurance agents can act as your own Personal Advisor. With a no-cost, no-obligation consultation, we can help you compare plans, and take advantage of all the savings available.

Posted by Wiley Long at 01:32 AM | Comments (0)

June 01, 2010

Health Savings Accounts Continue to Grow in Popularity

If you’ve decided this is the last year you’re going to let tax-deductions for your healthcare expenses slip away, check out Health Savings Accounts. A Health Savings Account (HSA) offers the tax advantages of tax-free interest, and tax deductions for health-related expenses.

To get started, choose the bank or trustee you want to administer your HSA.

You can find a list of HSA Administrators, as well as information on fees, interest rates, and investment options. If you want your money invested in an interest-earning savings account, choose one with lower or zero fees. You can also place your HSA funds with an administrator offering investment options.

There are three ways you can fund your HSA. You can contribute to your HSA only when you incur health-related expenses, and immediately withdraw funds to reimburse yourself. That way, you are making your health-related expenses tax-deductible. You can also fully fund your HSA, and let what you don’t need for health-related expenses grow tax-deferred. Another alternative is to fully fund your HSA, but pay your health-related expenses from a different account and reimburse yourself at a later date. This lets you maximize your tax deduction, and maximize the tax-deferred growth of your HSA. Check out Maximize Your HSA newsletter for more information.

At HSA for America, you can learn all about Health Savings Accounts, and take control of your health-related expenses. Like a more personal approach? Just call our Personal Advisors at 866-749-2039 to schedule a no-cost consultation. Our experts have worked with HSA plans for years, and are happy to answer your questions about how a Health Savings Account can save you money.

Posted by Wiley Long at 10:40 PM | Comments (0)

May 20, 2010

Health Savings Accounts Win with Employers

As an employer, you know the value of protecting your employees’ health. When you figure in the cost of hiring and training, even to temporarily keep up the work flow while employees are out with an extended illness, employee health impacts the bottom line.

With the high-cost of health insurance, employers have sought alternatives, such as consumer-driven health plans. A few employers have offered both Health Savings Accounts and Health Reimbursement Arrangements (HRA), but Health Savings Accounts are winning by a landslide in popularity.

In the last few years, the number of employers offering a Health Savings Account (HSA) grew from 48 to 56 percent. The number of employers offering HRA fell from 43 to 35 percent during the same period.

Health Savings Accounts have worked for employers with as few as two employees, and for large corporations with more than 100,000 employees. The best HSA plans are designed to be easy for employees to understand and to use. These plans often have 100-percent coverage for preventive care services. That helps keep employees on the job and productive.

To learn why Health Savings Accounts are the number one choice, visit us at HSA for America. You’ll see why both employers and employees favor Health Savings Accounts, and find links to HSA Resources with online applications for your convenience, and excellent support for employer groups.

Posted by Wiley Long at 10:28 PM | Comments (0)

May 12, 2010

Health Savings Account Owners Save with Unique Discounts

Health Savings Accounts are known for tax-free interest, and tax deductions for health-related expenses. These accounts are even known to be combined with the lower-cost premiums of high-deductible health insurance plans. The biggest secret about these savings accounts may be the other unique ways you can save money with your own Health Savings Account (HSA).

To get those lower premiums, HSA owners have high deductibles, and pay for their own medical bills until their deductible is met. They can take advantage of no-cost bill negotiation services to lower their medical bills.

Before paying a medical bill, you can submit it to our negotiation service. If we can negotiate a reduced bill for you, you keep 70 percent of the savings! If our negotiations don’t reduce your bill, you pay us nothing.

With a high-deductible insurance policy, you may also pay for some of your doctor office visits. To help you save on these, we have negotiated real-time access to licensed physicians by phone, and by email. Use our free consultation services to be sure when you really need to pay for an exam or treatment. You’ll probably get more advice using this alternative than you would if going to a doctor’s office were your only option for health care advice.

Learn more about these ways to save and other benefits at HSAforAmerica. We offer a selection of different types of insurance to protect your health and your dreams, but we’re not a big corporation. When you call us at 866 749-2039, you won’t be shuffled into a phone bank. You can discuss your needs with a licensed insurance agent who will become your own Personal Advisor for as long as you’re a client. Schedule a no-cost consultation, or use our How To Use an HSA Guide at your convenience to start saving more of your health care dollars today. Now, you have a friend in the insurance business.

Posted by Wiley Long at 11:48 PM | Comments (0)

May 06, 2010

Health Savings Accounts Help You Get Your Money’s Worth

With the new healthcare reform legislation, not only will more people be protected by medical intervention, but the quality of medical treatment will also improve. The U.S. Health and Human Services Department will have two years to set penalties on hospitals with high readmission rates. That will encourage hospital staff to be sure you’re healthy enough to leave the hospital when you’re released. In other words, you’ll get your money’s worth.

Health Savings Accounts can also help you get your money’s worth by allowing you to earn interest free from taxation. You can deduct more of your health-related expenses from your taxable income, and lower your taxes with a Health Savings Account (HSA).

The healthcare reform legislation will also help you get the most for your healthcare dollars by requiring insurance companies to reveal how much of members’ premiums they spend on medical care, as opposed to executive salaries or other administrative costs. Next year, insurance companies will owe their customers a rebate if the insurers spend less than 80 percent on benefits for people in individual or small-group plans.

With health insurance and Health Savings Accounts becoming better values, it’s time you learned how you can benefit from a HSA insurance plan. You can use our “How To Use an HSA Guide,” or schedule a no-cost consultation with an independent licensed insurance agent. At HSA for America, you can find a wide range of insurance because we’re independent agents. Since we’re not bound to one company, we can look for the best plan from different companies to protect your health and your dreams. Call us at 866 749-2039 to schedule a no-cost consultation with your own Personal Advisor who you can rely on for as long as you’re a client.

Posted by Wiley Long at 01:55 PM | Comments (0)

May 02, 2010

Health Savings Accounts Are More Valuable after Healthcare Reform

With the new healthcare legislation, insurance companies will be extending protection to more people. Insurers will be required to protect children with pre-existing health problems within the first year of the legislation, and must permit parents to keep their children on the parents’ insurance plans until children reach age 26.

With a Health Savings Account (HSA), you can take a tax deduction for withdrawals from your HSA to pay for health-related expenses not just for yourself and your spouse, but also for your children and any family member. That’s true even if that person is not covered by your health insurance. All of these health-related payments can be deducted from your income to reduce your taxes.

The new legislation also prevents insurance companies from revoking coverage because of severe illness, and from limiting your annual or lifetime benefits. That will help you get back the value of all those insurance premiums.

With new health insurance regulation, high-deductible health insurance plans that work with Health Savings Accounts are a better value. See how a HSA can help you at HSA for America. You can use our HSA "How To Guide", or schedule a no-cost consultation. At HSA for America, we offer a broad range of different types of insurance to protect your health and your dreams, but we’re not a big corporation. Call us at 866 749-2039 to be assigned your own Personal Advisor who you can rely on for as long as you’re a client.

Posted by Wiley Long at 01:47 PM | Comments (0)

April 28, 2010

Health Savings Accounts Offer Discounts on Lab Fees and Much More

You may have heard that a Health Savings Account (HSA) offers tax benefits (including tax-free interest and tax deductions for health-related expenses), but did you know that HSA benefits can help you save on lab fees and prescriptions?

HSA for America can help you save up to 80 percent on lab tests, like blood tests and CAT scans. HSA for America clients and Website visitors have access to discounted pricing when they order tests, and go to the closest participating lab to have the tests run. Results are usually available within 48 hours.

To help lower your prescription costs, HSA for America has a Prescription Drug Discount Card that you can download immediately to receive savings of up to 75 percent at more than 54,000 national and regional pharmacies. Participating pharmacies include BI-LO, CVS Pharmacy, Drug Fair, Eckerd Drugs, Fred's Pharmacy, King Soopers, Kmart, Publix, Rite Aid, Walgreens, Winn Dixie, and thousands of independent pharmacies.

To learn more about how Health Savings Accounts can help you take control of your medical expenses and take advantage of money-saving benefits, visit HSA for America online, or call us at 866-749-2039 to schedule a no-cost consultation with your Personal Advisor. Our experts have worked with HSA plans for years, and can answer your questions about how a Health Savings Account can save you money.

Posted by Wiley Long at 01:42 AM | Comments (0)

April 25, 2010

Health Savings Accounts Offer Prescription Savings and Much More

If you’ve heard about the growing popularity of Health Savings Accounts, and want to learn more about they can save you money, HSA for America has online answers, and experienced Personal Advisors available at no cost. Just call HSA for America at 866 749-2039 to set up a convenient time to discuss your questions, and we can help you sort through HSA Plans to see which fit your needs best.

HSA for America also has more unique ways to help you save. Because HSA plans carry high deductibles, you may be paying for more routine doctor visits. HSA for America has negotiated a special arrangement for our members with Consult A Doctor to give members real-time access to licensed physicians by phone. Members can also email their medical concerns, and receive a physician’s response within hours.

With HSA for America, you’ll also benefit from free bill negotiation service similar to the negotiation power that insurance companies and major employers have to negotiate much lower prices than the general public gets. Before paying a medical bill, our members submit claims to our negotiation service. If we can negotiate a reduced bill, you keep 70 percent of the savings! If we are unable to negotiate a price reduction, you pay us nothing. HSA for America website visitors may sign up for bill negotiation at NO COST.

HSA for America is also proud to announce a special program called My HSA Rewards. When you shop with major retailers (including Barnes & Noble, Netflix, Starbucks, Target, and others), you will automatically earn cash rewards of 0.5% to 25% on qualifying purchases. All of your earned rewards accumulate, and can transfer to your HSA when the amount totals $50 or more. At HSA for America, we can help you be smart about how you handle your medical expenses. We’ll help you take advantage of all the money-saving tools (including savings on lab fees and prescription drugs) so you can reduce your annual medical costs, and have more money in your HSA to grow tax-free.

Posted by Wiley Long at 01:28 AM | Comments (0)

April 22, 2010

Health Savings Accounts Are the New IRAs

Health Savings Accounts share certain benefits with IRAs, and offer more health-related savings. Money you contribute to a Health Savings Account (HSA) grows in your account free from federal taxes, and most state taxes. HSA funds also remain free from federal tax when you withdraw them to pay for qualified medical expenses. If you withdraw HSA funds for non-medical expenses, you pay taxes on the amount withdrawn.

If you use HSA funds before you’re 65 for non-medical expenses, there is a ten percent penalty, which is similar to IRA rules. Once you’re 65, you can withdraw your HSA funds penalty-free for any reason, but you still pay income tax on the money withdrawn.

Because your HSA deposits that are not used to pay medical expenses grow without being taxed, Health Savings Accounts offer an advantage over many other forms of savings accounts. HSA investments can be placed in bonds, mutual funds, traditional savings accounts, or stocks.

To learn more about how Health Savings Accounts work, visit out website at http://www.Health--Savings--Accounts.com or call us toll-free at 866 749-2039. You can get assistance from our friendly and knowledgeable Personal Advisors, all of whom are licensed insurance agents. We can help you cut through the clutter, and find the plan that is best for you. We can assist you with the application, and keep you informed while it goes through the approval process. You’ll be able to discuss any questions with your Personal Advisor for as long as you remain a client.

Posted by Wiley Long at 01:13 AM | Comments (0)

April 17, 2010

Health Savings Accounts: Tax Deductions + Tax-free Interest

One way to save money on health insurance premiums is often overlooked. A survey by Guardian Life Insurance found that six years after Health Savings Accounts were introduced, only 59 percent of people surveyed had heard of them. Fifty-two percent were not even aware that contributions to a Health Savings Account or a HSA were tax deductible, and could reduce the amount of annual income subject to taxation.

Likewise, fifty-five percent of those surveyed did not know that withdrawals from Health Savings Accounts to pay for qualified medical expenses were not taxed. Even fewer people (40 percent) realized that, unlike flexible spending accounts, they could always keep a HSA even if they lost their job, changed jobs, or retired.

You can learn more about how Health Savings Accounts earn interest tax-free while still offering tax-deductions at HSA for America You’ll see how much you can invest in Health Savings Accounts, and what expenses can work as tax deductions for you. You’ll find a long-term savings chart there, along with an example of the total net savings for a family of four thanks to their HSA plan.

You can also ask questions at no cost and without any pressure just by calling us at 866-749-2039. Our experts have worked with HSA plans for years, and can help you select the Health Savings Account option that’s right for you.

Posted by Wiley Long at 08:47 PM | Comments (0)

April 13, 2010

Health Savings Accounts Equal Tax Deductions

A Health Savings Account (HSA) can equal more tax deductions because you can deduct a broad spectrum of health-related products and services purchased with funds from your HSA. These purchases can be for birth control pills, over-the-counter medicines, and vitamins that a doctor prescribes.

You can also deduct purchases for hearing and vision improvement, such as contact lenses, exams, and replacement insurance. Eye glasses, or laser eye surgery are also qualified. To aide with hearing, a closed-caption television decoder, hearing aides and their batteries, phone modifications, and special education are also qualified expenses.

Braces, crutches, handicapped car controls, a wheelchair, or home and vehicle modifications to accommodate a wheelchair are all qualified HSA purchases that can be deducted. Here’s a more complete listing of HSA qualified expenses.

If a Health Savings Account is right for you, it’s easy to compare HSA plans and apply online at HSA for America. If you have questions, you can consult with experts who have worked with these plans for years at no cost. When you call us at 866-749-2039, one of our HSA advisors can answer your questions, or schedule a conference time that’s convenient for you.

Don’t let any more tax deductions slip by without taking advantage of what a Health Savings Account can mean for you and your family.

Posted by Wiley Long at 08:40 PM | Comments (0)

April 05, 2010

Health Savings Accounts Make More Expenses Tax Deductible

A Health Savings Account (also called a HSA) allows you to take tax deductions for more expenses to reduce your taxable annual income. In addition to your own health-related expenses, you can take tax deductions for what you spend on health-related expenses from your HSA for your spouse and dependent family members.

If you’re under 65, you can open a HSA just like other forms of savings accounts. Unlike most savings accounts, though, Health Savings Accounts earn tax-free interest. If you don’t need to spend what you contribute to your HSA, you can let it grow until you need it for your retirement. And when you’re over the age of 65, there’s no penalty to withdraw money from your HSA.

You’ll need to combine your HSA with one of the high-deductible health insurance plans that are qualified to work with Health Savings Accounts. Your family members do not have to be covered under your insurance in order for you to take tax-deductions for what you spend on their qualified expenses. If you‘re covered by other health insurance, you can still keep your HSA. You just can’t have medical expenses paid both through your HSA, and other insurance.

To learn more about how you can use the tax advantages of a HSA, check out HSA for America. It’s simple to compare HSA insurance plans and apply online, but you can also consult with experts on Health Savings Accounts at no cost. You can call our expert advisors at 866-749-2039 to discuss which Health Savings Account options work best for your situation.

Posted by Wiley Long at 01:33 AM | Comments (0)

April 01, 2010

What Are the Tax Advantages of Health Savings Accounts?

A Health Savings Account (HSA) allows you to avoid federal income tax by saving up to $3,050 for singles, or $6,150 for families, in tax-deductible contributions to your HSA. There is no minimum deposit (it can be $0), but any deposit you make into your HSA by April 15th is considered an "above the line" tax deduction for the previous year's income taxes. This means that you get a federal income tax deduction for money you put in even if you take the standard deduction, and don’t itemize.

This tax deduction is available to everyone because there are no limitations on the amount or source of income. Plus, a one-time rollover from your Flexible Spending Account, Health Reimbursement Arrangement, or IRA is allowed.

If your employer makes a HSA contribution for you, it is “excluded” from income. That means it’s NOT subject to any income tax or FICA. In all but four states (Alabama, California, New Jersey and Wisconsin), contributions to a HSA are NOT counted as income so you can also take a state income tax deduction for your HSA contributions.

Learn how to choose the right High-Deductible Health Insurance plan with our online Health Savings Account “How To” Guide. It explains exactly how to view your quotes, compare features, and check the physician network so you get the plan that is best for your situation. Then, just click “Apply” to complete the process online in minutes.

Our HSA Info page also provides clear, detailed information on exactly how HSA plans work, how to calculate your tax savings, and how to withdraw money from your HSA tax-free. You may also call us at 866-749-2039, and our expert advisors will answer your questions at no charge.

Posted by Wiley Long at 01:26 AM | Comments (0)

March 29, 2010

Health Savings Accounts and Tax-subsidized Medical Expenses

Even though you receive a tax deduction when you contribute to a Health Savings Account (HSA), that money is still yours to spend tax free for qualified medical expenses. Because an HSA is paired with a High-Deductible Health Insurance plan, qualified medical expenses include any costs you incur from seeing a doctor, prescription drugs, or other expenses toward your deductible.

You can use your Health Savings Account to cover expenses that would not typically be covered by a health insurance policy. Such HSA expenses include alternative treatments, dental expenses, lodging and transportation related to health care, long-term care premiums, maternity expenses, mental and physical therapy, non-prescription medications like aspirin or cough syrup, preventive health programs, and special fees related to guide dogs, wheelchairs, etc.

Alternative treatments can include acupuncture, aromatherapy, Ayurvedic medicine, homeopathy, nutritional consultation, and traditional Chinese medicine. Mental therapy includes the cost of psychiatrists, psychoanalysts, psychologists, and psychotherapists. Physical therapy may include chiropractor services, hydrotherapy, and medical massage. Plus, an HSA can be used to pay these expenses for any spouse or dependent member of your family, even if they are not covered by your health insurance policy.

If you’d like to take advantage of these HSA benefits and learn about their other benefits, you can find out more on our website at www.Health--Savings--Accounts.com, or call us at 866-749-2039. Our expert advisors will answer your questions at no charge.

Posted by Wiley Long at 11:45 PM | Comments (0)

March 26, 2010

Health Savings Accounts Can Lower Your Taxes

Health Savings Accounts can help you pay less income tax by reducing your annual adjusted gross income. According to the federal government and all but four states (Alabama, California, New Jersey and Wisconsin), contributions to a Health Savings Account (HSA) are not counted as income to the recipient.

You can invest the money you save in taxes in your HSA. Your HSA balance will grow quickly, too, because it earns tax-free interest like an IRA. Your employer can also contribute to your HSA.

Health Savings Accounts are paired with high-deductible health insurance plans, which have lower monthly premiums than typical health insurance plans. Lower health insurance premiums can also help you save money each month – money you can invest in your HSA to grow your account balance.

Your HSA will be available to you for life, and it’s completely independent from where you work. If you don’t need the funds from your HSA now, you can let it grow until you need it to cover retirement costs, such as Medicare deductibles and long-term care costs. When you’re over the age of 65, there’s no penalty to withdraw money from your HSA.

At HSA for America, it’s EASY to compare HSA insurance plans, and apply online. Have questions? Call us at 866-749-2039, and one of our HSA advisors can answer your questions and help you select the HSA option that’s best for you. Start today to receive benefits from your Health Savings Account for years to come!

Posted by Wiley Long at 11:35 PM | Comments (0)

March 23, 2010

Health Savings Accounts Can Help You Save for Retirement

Health Savings Accounts have more benefits than flexible spending accounts, and can help you save for retirement. A Health Savings Account (HSA) earns tax-free interest like an individual retirement account (IRA). That helps your balance grow faster than funds in a flexible spending account, which does not earn tax-free interest.

Withdrawals from a HSA to pay for qualified medical expenses are tax-free, and most contributions to a HSA are tax-deductible. According to the federal government and all but four states (Alabama, California, New Jersey and Wisconsin), contributions to a HSA are not counted as income to the recipient. Employers can also contribute to employees’ accounts.

To set up a Health Savings Account, you need to buy a high deductible health insurance policy. In exchange for a high deductible, your monthly premiums cost less than premiums of other insurance plans. That’s because insurance companies do not have to pay for numerous small charges they would cover in other policies.

If you’d like to take advantage of these HSA benefits, and learn about their other benefits, you can learn more at www.Health--Savings--Accounts.com, or call us at 866-749-2039. Our expert advisors will answer your questions at no charge.

Posted by Wiley Long at 10:14 PM | Comments (0)

March 18, 2010

Health Savings Accounts Help Beat Rising Health Insurance Costs

With the cost of health insurance rising much faster than income, many people are not receiving adequate medical care. The number of people who do not have health insurance grows as layoffs continue. A Health Savings Account (or HSA) offers many advantages, such as lower monthly premiums.

If you are in reasonably good health, you can select High Deductible Health Insurance that can be combined with an HSA. Your monthly premiums will be less, and any money you contribute to your HSA will earn interest tax-free so your balance will grow faster than if taxed. Your Health Savings Account contributions are tax-deductible, and withdrawals from your HSA to pay for qualified medical expenses are tax-free.

You have control of your Health Savings Account, but your employer may also contribute to it. As the account owner, you decide how to spend your money, and the types of investments you want to make your money grow. You take your HSA with you if you change jobs, are unemployed, or retire. Any unused balance rolls over year after year to continue earning tax-free interest.

If this sounds like just what you need, you’re not alone. The second largest bank in the U.S. added 115,000 new Health Savings Accounts last year, and those HSA owners deposited $220 million into those Health Savings Accounts. That brought the total number of Health Savings Accounts at a single bank to 500,000 accounts holding a combined balance of $740 million.

It’s easy to learn more about Health Savings Accounts and apply online at http://www.health--savings--accounts.com. But experts with years of experience with HSA accounts will answer your questions at no cost when you call us at 866-749-2039. As with any retirement account, the sooner you act, the sooner you start to save.

Posted by Wiley Long at 12:37 PM | Comments (0)

March 15, 2010

Health Savings Accounts Help Small Businesses

According to The Wall Street Journal, large enterprises spend about $6,000 for each employee every year for health coverage, and almost half of U.S. small businesses offer no health insurance benefits at all.

With ever escalating costs for health insurance, Congress has provided a new viable option for small businesses to help their employees in the form of Health Savings Accounts. How it that different from a typical group health insurance plan?

A Health Savings Account, often referred to as HSA, combines high-deductible health insurance plans with a savings account that's free of taxes for medical coverage purposes. A HSA plan can lower expenses for both small business owners, and their employees when it comes to health insurance. Most small business owners find that a HSA is a better alternative than the typical group coverage plan.

That’s because the high-deductible health insurance plans used with Health Savings Accounts have lower monthly premiums, contributions to a HSA are tax-free (contributions are not included in gross income), and withdrawals from a HSA to pay for qualified medical expenses are also tax-free.

It’s easy to compare HSA plans and apply online on our website. However, we also understand how Health Savings Accounts work, how much you can deposit, and how you can take advantage of tax savings. We’ll explain your options, and help you find the best plan to meet your needs when you call us at 866-749-2039.

Posted by Wiley Long at 12:36 PM | Comments (0)

March 12, 2010

Health Savings Accounts Help You Save Money

In this economy, saving money takes creative new strategies. If you’re reasonably healthy, a Health Savings Account (or HSA), can help you save in multiple ways.

First, you typically pay less in monthly premiums for High Deductible Health Insurance that is qualified to be combined with a Health Savings Account. Second, your contributions to your HSA plan (up to $6,150 for families in 2010) are tax deductible, and you pay no tax on withdrawals for qualified medical expenses.

Paying for qualified medical expenses from your HSA is easy, too. You HSA Administrator will provide you with a checkbook or debit card that is linked to your account. You can also pay for healthcare out of your pocket, and pay yourself back from your HSA. Just keep receipts to prove that the expenditures are legal. If you don’t need funds in your HSA to pay for medical expenses, the money will be there for you when you retire much like an IRA.

You can find out more about Health Savings Accounts and apply online at http://www.health--savings--accounts.com.

Have any HSA related questions? Experts who have worked with Health Savings Accounts for years will answer your questions at no cost at 866-749-2039. You can join the hundreds of thousands of people who put their trust in Health Savings Accounts last year alone instead of waiting for government action.

Posted by Wiley Long at 12:35 PM | Comments (0)

March 09, 2010

A Health Savings Account Has Benefits Like an IRA

Health Savings Accounts offer a better way to manage health care costs with tax advantages that help you save. If you want coverage in case of a catastrophic major accident or illness that will leave you with overwhelming medical bills, a Health Savings Account is made for you.

A Health Savings Account is often abbreviated as "HSA", but it's typically called a health IRA in the financial industry. That's because a HSA works much like an IRA (Individual Retirement Account). When you set up a free HSA, you buy a High Deductible Health Insurance policy. If the deductible is $1,200, you pay the first $1,200 in medical costs before your insurance begins to cover charges.

In exchange for a high deductible, your monthly premiums cost less than premiums of other insurance plans. That’s because the insurance company does not have to pay for the small, frequent charges they cover in other policies.

In addition to lower monthly premiums, you’ll also get tax breaks. You can contribute a certain amount of money each year to your Health Savings Account just in case you have health-related expenses not covered by your insurance. If you need to pay for medical charges before your deductible is met, you’re covered with your HSA. If you don’t have expenses, you keep the money instead of paying it to an insurance company through higher monthly premiums.

In 2010, individuals can contribute $3,050, and families can contribute $6,150 to an HSA. Contributions can be made with pre-tax dollars through your employer, or you can take a tax deduction if you do pay for medical expenses with post-tax dollars. Anything you have left over at yearend rolls over to the next year. Year after year, your HSA balance keeps earning tax-free interest just like an IRA. When you retire, your HSA balance can be withdrawn like an IRA. You win whether you do or don’t have medical expenses.

That’s why the second largest bank in the U.S. added 115,000 new Health Savings Accounts last year, and those HSA owners deposited $220 million into their accounts with that one bank. That brought the total number of Health Savings Accounts at a single bank to 500,000 accounts holding a combined balance of $740 million. It’s easy to learn more about Health Savings Accounts and apply online at www.health--savings--accounts.com, but experts with years of experience with these HSA accounts will answer your questions at no cost when you call us at 866-749-2039. As with any retirement account, the sooner you act, the more you’ll save.

Posted by Wiley Long at 10:44 AM | Comments (0)

March 04, 2010

Health Savings Accounts Help If You Lose a Job or Retire

A Health Savings Account (HSA) can do more for you than help pay for health-care expenses with tax-free dollars. It also helps to bridge gaps in health insurance coverage if you lose your job, or when you retire.

If you're under 65, you can open a free Health Savings Account when you buy a qualified high-deductible health insurance plan. You can keep your HSA even when you're covered with other insurance policies if you don't have medical expenses paid by both insurance and your HSA, called "double dipping."

Employers may offer flexible spending accounts for medical expenses that allow employees to set aside pre-tax dollars for medical expenses not covered by the company's health insurance, including premiums and deductibles. While you own and control your Health Savings Account, a Flexible Spending Account is controlled by your employer. That means you lose all the money in your Flexible Spending Account if you leave that employer.

A Health Savings Account is yours to keep if you lose your job, change jobs, or retire. Your HSA will still be there for you to pay medical expenses whether you have a job or are unemployed. Your HSA can act like a "safety net" while you’re looking for work, or during those common 90-day trials on new jobs before benefits begin. All the while, your HSA balance grows with tax-free interest just like an Individual Retirement Account (IRA). Remember that Flexible Spending Accounts do not earn interest. Find out how a Health Savings Account can save you money at www.health--savings--accounts.com, or call our experts at 866-749-2039. They’ll answer your questions at no charge.

Posted by Wiley Long at 11:19 AM | Comments (0)

March 01, 2010

Health Savings Accounts Are in Greater Demand Than Ever Before

Chase (the nation’s second largest bank) reported significant growth in Health Savings Accounts. Chase added 115,000 Health Savings Accounts, and $220 million in related deposits last year. That amounted to 500,000 Health Savings Account (HSA) owners with combined account balances of $740 million. So many people are saving with a HSA because they understand this offers a better way to pay for current health expenses, and save for future qualified medical costs. HSA contributions are tax-deductible, and earn tax-free interest. You can also make tax-free withdrawals from a HSA to pay for qualified medical expenses. A HSA also helps you save through the associated lower premiums of High Deductible Health Insurance.

The benefits of Health Savings Accounts can be realized when you pay for health expenses, and while you save for future medical charges. Contributions to your Health Savings Account are tax-deductible, and earn tax-free interest. Withdrawals from your HSA to pay for qualified medical expenses are also tax-free.

With a Health Savings Account (HSA), you choose the types of investments you want to make your money grow. All unused funds left in your account at yearend will be carried over to the coming year - with no limit. An employer may contribute to your account, but you take your HSA with you if you change jobs, are unemployed, retire, or decide to change plans. That’s an important advantage with today’s high unemployment. Certain banks, including Chase, allow you to transfer funds from your checking or savings into your HSA through a secure website, and pay medical expenses online from your HSA.

To take advantage of these HSA plans, you need High Deductible Health Insurance that works with a HSA. These high-deductible plans typically have deductibles between $1,200 and $5,950 for individuals, or $2,400 and $11,900 for families. Best of all, they also usually have lower monthly premiums. It’s easy to compare HSA plans and apply online at our website, but experts who have worked with these plans for years are available, too. When you call us at 866-749-2039, one of our HSA advisors can answer your questions, and help you select the best HSA options for your situation.

Posted by Wiley Long at 09:38 AM | Comments (0)

February 24, 2010

Health Savings Accounts Can Lower Insurance Premiums

Health Savings Accounts offer tax deductions for medical expenses, but lower monthly premiums for health insurance may be the greatest advantage Health Savings Accounts offer. Premiums for group health insurance rose 9.6 percent last year, and more than 10 percent for each of the previous six years. Premiums for individual plans went up even more, while insurance premiums associated with Health Savings Accounts only rose a mere 3.4 percent last year. In fact, average premiums for High Deductible Health Insurance associated with a Health Savings Account (HSA) for individuals actually dropped 19.5 percent during the past two years.

Every time you fund your Health Savings Account (HSA), you get an instant tax-deduction, and your HSA earns tax-free interest. Once you have enough in your HSA to cover smaller medical expenses, you can buy High Deductible Health Insurance that has lower monthly premiums than most other types of health insurance. Put the money you save on premiums each month into your HSA, and you get to keep the money instead of an insurance company when you don’t have medical expenses. That’s why it’s called a Health Savings Account.

To take advantage of these Health Savings Account benefits, you need High Deductible Health Insurance that works with an HSA. These high-deductible HSA plans typically have deductibles between $1,200 and $5,950 for individuals, or $2,400 and $11,900 for families. Best of all, High Deductible Health Insurance usually has lower monthly premiums.

It’s easy to compare HSA plans and apply online, but our experts who have worked with these plans for years are also available to help you compare plans. When you call us at 866-749-2039, one of our HSA advisors can answer your questions, and help you select the best HSA options for your situation. The sooner you act, the more you'll save.

Posted by Wiley Long at 08:36 AM | Comments (0)

February 20, 2010

Is a Flexible Spending Account as Good as a Health Savings Account?

While Flexible Spending Accounts and Health Savings Accounts have some similarities, they also have important differences. Health Savings Accounts offer greater control, and more benefits.

While you own and control your Health Savings Account, a Flexible Spending Account is controlled by your employer. That means you lose all the money in your Flexible Spending Account if you leave that employer, but you can keep your investment in your Health Savings Account if you change jobs, become unemployed, or retire.

Money you deposit into your Health Savings Account is tax-deductible, and you decide how to invest it. The interest earned is tax-free while kept in the account, and the interest is not taxed when used to pay for healthcare expenses. Flexible Spending Accounts do not earn interest.

Withdrawals from your Health Savings Account used to pay for qualified medical expenses are also tax-free, and can be used for any healthcare related expenses, including health insurance co-pays and non-prescription medications. If you don’t spend the money you contribute to a Flexible Spending Account each year, you lose it at the end of the year. With Health Savings Accounts, all unused funds and interest are carried over from year to year.

At HSAforAmerica, we understand how HSA plans work, how much you can deposit, and how you can take advantage of these tax savings. We’ll explain your options, and help you find the best HSA plan to meet your needs with Health Savings Accounts.

Posted by Wiley Long at 12:51 AM | Comments (0)

February 16, 2010

Health Savings Accounts Save Money with Low-cost Health Insurance

Health Savings Accounts work with health insurance plans that have lower monthly premiums. Premiums for group health insurance rose 9.6 percent last year, and premiums for individual plans rose even more. Yet, insurance premiums for health insurance associated with Health Savings Accounts rose a mere 3.4 percent last year. Amazingly, average premiums for High Deductible Health Insurance associated with Health Savings Accounts for individuals actually dropped 19.5 percent during the past two years.

How is that possible?

With a High Deductible Health Insurance plan, the insurance company doesn’t have to pay for small, frequent charges they cover in other policies. In exchange for a high deductible, you pay less each month in premiums. If you have medical expenses before your deductible is met, you can pay for them with your HSA. If you have no expenses, you keep all the money in your HSA instead of spending it on higher monthly premiums. That money earns tax-free interest just like an Individual Retirement Account (IRA).

An HSA gives you more control over your expenses. It’s your to keep even if you can’t find work. It will grow faster because it earns tax-free interest even if you’re in a high tax bracket. You can’t lose it if you lose a job, change jobs, or retire. If you don’t need it to pay for medical expenses, it’s there for you when you retire much like an IRA. You can find out more about Health Savings Accounts and apply online at our website.

Have questions? Experts who have worked with these accounts for years will answer your questions at no cost at 866-749-2039. You can join the hundreds of thousands of people who have put their trust in an HSA last year alone.

Posted by Wiley Long at 09:29 AM | Comments (0)

February 01, 2010

How a Health Savings Account Can Help to Protect Your Finances

If you have health insurance, you might be surprised to learn that a starling 16.6% of American adults are still uninsured, despite the high degree of attention that has been given to health insurance issues in the U.S. lately. Many American adults without health insurance are put into a tricky situation when they have a catastrophic injury or illness and are then stuck with an expensive emergency room or ICU bill. According to many, living without health insurance is a high stakes gamble that too many Americans make every day.

However, there is hope for those Americans who either can’t afford traditional health insurance or don’t qualify for health insurance plans that suit their budgets because of existing health conditions. Health Savings Accounts are available to help Americans obtain low-cost health insurance and set aside money in a savings account that can be used to pay for healthcare expenses that are not covered by their health insurance plans.

Health Savings Accounts have grown steadily in popularity since they were first created in 2003. The primary role of Health Savings Accounts is to provide participants with health insurance protection in the event that they have a catastrophic illness or injury. Health Savings Accounts are used in conjunction with high-deductible health insurance plans that have low monthly premiums that are affordable for just about anyone.

In addition to the low-cost HSA insurance plan that is associated with the Health Savings Accounts, participants establish specific Health Savings Accounts, which are savings accounts, in a sense. These savings accounts are similar to an IRA, in that the funds that a participant deposits into the savings account can be invested into high interest-yielding stocks, bonds, and other investments to help grow the savings amount. Moreover, the funds that a person deposits into a Health Savings Account are tax-deductible, which means that those funds will reduce the person’s annual tax burden.

Some individuals who have Health Savings Accounts are able to save thousands of dollars each year as a result of their participation. Here are some of the ways that Health Savings Accounts can help participants to save money:

* Contributions to a Health Savings Account are tax deductable

* Funds withdrawn from Health Savings Accounts for qualified healthcare expenses are tax-free

* Investment earnings from the funds in the Health Savings Accounts are tax-free

* Participants keep the funds from their Health Savings Account even if they move, change jobs, become unemployed, change marital status, or change health insurance policies

* Participants are in control the amount of money saved in the Health Savings Accounts, including deciding when to use those funds for expenses, and how to invest the money

* Funds can be set aside and continue to grow to use for future medical needs

* Both individuals and employers can make contributions to Health Savings Accounts

HSA Administrators (Banks, credit unions, and other financial institutions) can help Health Savings Account participants set up their accounts. However, in order to qualify for participation in a Health Savings Accounts, participants should meet the following criteria:

* They must be enrolled in a qualifying high-deductible HSA health insurance plan

* They can only be covered under one health insurance plan

* They must not be listed as a dependant on a tax form

* Participants cannot have Medicare coverage

Contact us today for more information about how Health Savings Accounts can help to save you and your family a significant amount of money each year while ensuring that you receive the best possible health care coverage for your needs.

Posted by Wiley Long at 01:40 PM | Comments (0)

January 18, 2010

Health Savings Accounts Can be Used to Improve Financial Security

Health Savings Accounts can not only save you money on health insurance expenses now, but they can also serve as a vehicle to help you grow your retirement savings in a strategic way. Health Savings Account participants can use their accounts to help grow their savings tax-free (or tax-deferred). For many people, a Health Savings Account can serve as a second retirement account that will be available to help cover their medical expenses in addition to any other retirement expenses they may have.

Many people do not retire until the age of 65, as 65 is the age that they can qualify for Medicare health care coverage. As a result, many people work longer than they want to simply to get the health insurance benefits provided by their employers. By establishing a Health Savings Account, participants are able to set aside funds that they can use to pay for their medical expenses now or in retirement, helping to ensure their financial independence and security.

But just how much money should Health Savings Account participants have when they retire in order to cover their health care expenses (expected and unexpected)? According to Fidelity Investments, in 2006, the average couple retiring will need $190,000 to be financially comfortable paying for their retirement medical expenses. This figure is based on the average life expectancy for people who retire at age 65, which is 15 years for men and 20 years for women.

Some financial advisors believe that Health Savings Accounts are more important for an individual’s retirement security than IRAs and even 401(k) accounts. Health Savings Accounts allow individuals to withdraw money from their savings to pay for any expense, including medical expenses, but not limited to medical expenses. When withdrawing money to pay for qualifying medical expenses, individuals will not pay taxes on the withdrawal. However, individuals only pay taxes when they withdraw money to pay for non-medical expenses. Therefore, Health Savings Accounts are versatile and tax-friendly savings accounts that provide account-holders with flexibility they can use to their advantages.

It’s also important to note that if you do have an IRA as a retirement savings account, the funds that you withdraw from you Health Savings Account will not affect your annual IRA limit.

The tax advantages of a Health Savings Account are also extremely beneficial to many participants and help to save them a significant amount of money each year, which reduces an individual’s annual tax burden. Individuals over the age of 55 can contribute catch-up money as well. The amount of the catch-up amount changes each year, but that catch-up limit is also tax-deductible. If a couple shares a Health Savings Account, the couple can establish the Health Savings Account in the older person’s name so that they can contribute a larger sum of money each year once the older person turns 55. In other words, I both participants do not have to be over the age of 55 in order to take advantage of the catch-up limit increase.

One of the many advantages of Health Savings Accounts is also that they are self-directed, which means that participants are able to control how much money they contribute to their accounts each year, where that money will be spent, and how that money will be invested while it is in the Health Savings Account. Therefore, Health Savings Accounts help individuals to stay in control of many aspects of their health care management more effectively.

How to Increase Your Health Savings Account Growth

There are three simple strategies that Health Savings Account participants can use to improve the growth within their Health Savings Accounts:

1: Invest the funds from the Health Savings Account into a mutual fund or stock that has a high-interest yield. As with any investment, there is a degree of risk involved, so make sure that you are comfortable with your investments and with the risks.

2: Keep your funds in your account for as long as you can. Of course, you can withdraw your Health Savings Account funds at any time to pay for qualifying medical expenses – and those withdrawals will not be taxed – but the longer you leave your money in a high-interest yielding vehicle, the greater the funds will grow.

3: Contribute as much as you can as early as you can in the year. You have until April 15 to make a Health Savings Account deposit in time for tax season. However, if you fund it early, your money will grow tax-free for a longer period of time than if you funded it later. By contributing to your Health Savings Account on January 1 of each year rather than April 15, you can earn more than $40,000 in interest over 20 years and over $100,000 in interest over 30 years.

Health Savings Accounts Can Provide You With Funds You Can Use to Pay for Medical Expenses During Retirement

Health Savings Account funds can be used to pay for Medicare expenses, including Medicare premiums, deductibles, copays, and coinsurance. Many Medicare beneficiaries are responsible for paying for their own nursing home expenses, unconventional terminal illness treatments, and proactive health screenings. The only exclusion from the qualifying Medicare expenses list is Medigap insurance; you cannot use Health Savings Account funds to pay for Medigap policies.

Health Savings Accounts can also be used to pay for health care expenses that you may have even if you pay for your healthcare through an employee retirement plan. Health Savings Account funds can even be used to pay for long-term care assistance, and has maximum annual limits that change every year.

If you are interested in establishing your own Health Savings Account now, you’re taking the first step towards financial freedom and independence. In order to get started, you’ll need to open a qualifying high-deductible health insurance policy that is compatible with HSA plans. Speak with an experiences Health Savings Account advisor to learn more about which health insurance plans may be best for your specific health care needs or for more information about how Health Savings Account plans can help you establish better financial freedom for yourself and your family.

Posted by Wiley Long at 11:30 AM | Comments (0)

January 12, 2010

Seven Things to Know About a Health Savings Account

Health Savings Accounts are becoming increasingly popular savings accounts used to pay for qualifying medical expenses. Since they first became available in 2004, about 2.5 million Americans have opened a Health Savings Account. However, Health Savings Account plans may not be the best options for everyone. If you are thinking about enrolling in a Health Savings Account, here are seven things you need to know:

1. A Health Savings Account plan can reduce healthcare costs by an average of 40 percent for many participants.

While HSA plans can significantly reduce health care costs for many participants, some people will not achieve any significant net savings. Individuals most likely to save a great deal of money by enrolling in Health Savings Accounts are those individuals who pay their own health insurance policy premiums, which include self-employed individuals who are relatively healthy and have few medical expenses.

2. Health Savings Accounts help to restore participants’ freedom of choice.

An HSA plan gives control back to individual consumers when it comes to their health care choices and options. As a result of the increased control, HSA participants must also be more responsible for their own health care decisions. Being self-reliant and responsible for health care choices is not always the best thing for all consumers, especially those who may be more comfortable with HMO-type “co-pay” plans.

3. Health Savings Accounts reduce income taxes.

Every dollar that participants contribute to their Health Savings Accounts is deducted from taxable income in the same way that contributions into a traditional IRA can be deducted from income tax burdens. Additionally, interest from the Health Savings Account savings and from investments made through a Health Savings Account are tax-deferred, just like a traditional IRA. However, unlike an IRA, withdrawals from a Health Savings Account are tax-FREE when the funds are used to pay qualifying medical expenses.

Also, in many situations, new account holders can fund their Health Savings Accounts with the money they save on health insurance premiums from their prior traditional health insurance plan that have higher premiums than HSA insurance plans.

4. Participants must have a qualifying high deductible health insurance plan in order to enroll in a Health Savings Account.

Health Savings Account participants need to have a high deductible health insurance plan that qualifies for participation in a Health Savings Account – not just any high deductible health insurance account. If you have recently enrolled or are thinking about enrolling in a high deductible health insurance plan, it is important to make sure that your policy qualifies for Health Savings Account participation. You may want to work with a qualified health insurance policy broker who is experienced in identifying properly qualified Health Savings Account plans to be sure you open the right plan.

5. You must be insurable in order to qualify for the Health Savings Account - qualified health insurance policy.

If you do not already have a qualified high deductible insurance policy, you will need to switch your insurance policy plan in order to become eligible for a Health Savings Account. Unless your health insurance plan coverage is offered under small group reform laws through an employer, the high deductible policy will be individually underwritten by an insurance policy company. In some cases, “pre-existing” considerations may not be fully covered.

Alternatively, some health insurance providers may cover certain “pre-existing” conditions in exchange for slightly higher premiums. In some cases, health considerations will make an individual uninsurable (such as individuals with diabetes, Chron’s disease, or a history of heart attacks, etc.). Keep in mind that health insurance underwriting requirements vary by state, which is another reason to use the services of an experienced health insurance plan broker.

Also, keep in mind that you may not want to switch to a Health Savings Account plan when the management of existing medical expenses is more important to you than saving up-front medical insurance premiums. Also, it is advisable that you do not change health plans in the middle of ongoing medical treatments; after a significant health issue has been diagnosed; or if a covered family member is pregnant.

Generally, it is relatively hassle-free to qualify for a qualifying health insurance plan. Most insurance policy companies offering Health Savings Account coverage will issue the policy based on your answers to the health insurance application, which is sometimes accompanied by a follow-up telephone interview. In some cases, medical records may be requested by the health insurance policy provider. Moreover, some health insurance policy providers may require a health exam prior to providing the health insurance.

6. Although Health Savings Account health insurance plan premiums are low, they are not always as low as you might expect.

Health insurance premium rates may be higher than you expect, in some cases. Although qualifying health insurance plans have a “high” deductible, as required by law, the insurance company still must compensate for the financial it is assuming by charging premiums. Many health insurance companies offer health insurance policies with just “one deductible” limit that must be reached – and that all family members contribute toward. With these shard deductible plans, it is not uncommon for premiums for a $5,000 family deductible with 100% coverage after the deductible to be similar to a $2,500 “per person” deductible plan with 80/20 coverage after the deductible has been met.

Having lower health insurance premiums represent just one element of the lower net cost that is achieved with a Health Savings Account plan. In addition to these lower premiums, the low net cost of a Health Savings Account plan is achieved after factoring in the benefits of lower taxes, which are made possible by the tax-deductible contribution to the Health Savings Account. Thus, if finding a health insurance plan with the lowest possible premium is your main concern, you may wish to consider a high deductible, non- Health Savings Account policy, especially if you do not see the benefit to contributing to a tax-deductible savings account.

7. Health Savings Accounts offer your best chance to help control health insurance rate growths.

Even with the Health Savings Account policy, you will still see rate increases because your Health Savings Account-qualified policy is still a health insurance policy at heart. However, you can expect that the actual dollar amount of any future rate increases will be lower than traditional health insurance plans, such as regular PPO and HMO plans. This lower rate increase occurs because insurers base rate increases on percentages - and the same percentage of a lower base health insurance premium correlates to a lower dollar increase. Health Savings Accounts are not a health insurance or health care perfect solution-but it is the most cost-efficient solution for many qualified people.

Posted by Wiley Long at 09:46 AM | Comments (0)

January 10, 2010

How to Set Up a Health Savings Account; A Step-by-Step Guide

Health Savings Accounts provide an excellent way to save money and grow financial assets. Health Savings Accounts provide a vehicle for participants to make tax-deductible contributions into a personal savings account that can be used to pay for qualifying medical expenses.

In addition to the tax deduction participants receive for contributions they make to their Health Savings Accounts, the funds held within a Health Savings Account grow tax-free and can be withdrawn tax-free to pay for qualifying medical expenses. Therefore, participants often invest the funds within their Health Savings Accounts into high interest-yielding investments such as stocks and bonds.

Moreover, monthly premiums on HSA plans are typically much lower than other health insurance plans because Health Savings Account-qualifying plans are high-deductible plans. Lower premiums, coupled with the many tax-advantages, make Health Savings Accounts very attractive savings and financial growth options for many people.

Here’s what participants need to do to open their own Health Savings Accounts:

Step 1

Make sure that you are enrolled in a qualifying high-deductible health insurance plan that is compatible with Health Savings Accounts. Qualifying HSA insurance plans have an annual deductible that is higher than traditional health insurance plans. These plans must also have an annual out-of-pocket maximum. Additionally, Health Savings Account participants must not have been claimed as a dependent on another person's taxes during the previous year.

Step 2

You’ll need to choose an administrator for your Health Savings Account. By law, Health Savings Accounts must be managed by an independent third-party trustee – not by the health insurance company that issues your health insurance plan. Banks, credit unions, and some brokerage firms are generally offer Health Savings Account administration services.

Step 3

Gather together all of the required Health Savings Account paperwork. Health Savings Accounts are tax-favored accounts, so they must have certain information reported to the IRS each year by both the administrator and the account owner. Financial institutions will require some biographical information about the account holder as well as a taxpayer ID number such as a Social Security number.

Step 4

Complete all of the required the Health Savings Account paperwork. Don’t forget to sign it where required. Be sure to retain a copy of all Health Savings Account paperwork for your own records and return the original copies to your Health Savings Account administrator.

Step 5

Finally, you’ll need to deposit funds into your Health Savings Account. Contributions to your Health Savings Account can generally be made by check, bank transfer, and by wiring funds. For accounts held at a bank or brokerage firm where you already have a savings account, funds can usually be transferred between accounts. Be sure to keep records of all deposits, as Health Savings Account contributions are tax deductible in most cases.

For additional information, you can find a complete Health Savings Account How-To-Guide on our website.

Posted by Wiley Long at 09:33 AM | Comments (0)

December 22, 2009

Health Savings Account Balances Grew in 2009 1st Quarter

The average Health Savings Account balance in America has continued to grow each quarter, even as the national economy still faces slow economic conditions, according to the Health Savings Account Market Q1 – 2009 report from Canopy Financial.

Canopy Financial is a national vendor for consumer-directed health plan (CDHP) financial technology and electronic payment systems that are used by banks and managed care companies. During its research, the company found that the average individual Health Savings Account subscriber during the 1st quarter of 2009 was 42 years old and contributed $116 each month – a figure that is up from the average monthly contribution of $111 during the 4th quarter of 2008. Employer contributions also increased during the 1st Quarter in 2009 from $69 to $113 for individual Health Savings Account participants.

Family Health Savings Account participation was also evaluated and found to have increased in Q1; the family Health Savings Account enrollee was 45 years old and contributed an average of $239 each month – a figure that increased from an average contribution of $206 per month in the 4th Quarter of 2008. Employer contributions to family Health Savings Account plans increased to $266 from $133 in the previous quarter. The average ages for family Health Savings Account participants remained the same for each quarter.

“Consumers enrolled in CDH plans demographically are very similar to consumers of traditional health care,” noted Vik Kashyap, CEO of Canopy Financial. “Consumers are clearly using these accounts for saving towards long-term care needs and even retirement.”

Individual Health Savings Account balance averages in the 1st Quarter of 2009 were $960, which was an increase from $928 in the 4th Quarter of 2008 and from $697 for the 1st Quarter first-quarter 2008. Family Health Savings Account balances increased to $1,720 from $1,600 in the previous quarter and from $1,419 in 1st Quarter of 2008.

Kashyap says the trend in increasing balances is important; “The most significant thing we have noticed is that even in a recession economy, both employers and consumers continue to make contributions to and invest in CDH accounts, which supports the contention that CDH products have become a key/integral component of employer-sponsored health care, and that contributions in many ways mimic those made to 401(k)s in which people invest a little bit each month into these accounts in an effort to accumulate long-term wealth/funds for long-term medical needs.”

By comparison, average balances for Health Investment Accounts (HIAs) varied. While the average HIA balances for families increased by 5% to $10,681 in the 1st Quarter of 2009 from $10,178 in the 2008 4th Quarter, the average HIA balances for individual account holders dropped by 2% to $8,002 in the 1st Quarter of 2009 from$8,148 in the 4th Quarter of 2008.

When understanding the data his company collected, Kashyap points to the importance of the average dollar amounts invested in health investment accounts. “If you look at the report, I think these numbers would be surprising to most in both health care and financial services for how high these account balances on average are,” he said.

As savings increased, spending from Health Savings Accounts was down in 2009. The average monthly expenses for the 1st Quarter of 2009 were $81, compared to $83.54 from the previous quarter. The average monthly expenses for family Health Savings Accounts was $103, down from $108.19 the previous quarter. Hospital expenses contributed to the monthly expenses for both individual and family Health Savings Account holders. Other expenses included dental services, vision expenses, and lab/diagnostic tests.

“The most important take-away for employers is the dollar values held in both HSAs and HIAs, and the fact that their employees are using these accounts not only as savings vehicles for long-term medical expenses, but ultimately towards retirement,” said Kashyap. “Additionally, as their employees increasingly use these accounts to manage their health care expenditures,…they are becoming much more informed/empowered consumers of health care services, which will play a key role long term in reducing overall health care costs of an organization and the costs associated with managing employer-sponsored health care.”

Demand for CDHP that provide Health Savings Accounts is Expected to Rise

Kashyap predicts that there will be an increase in demand for healthcare solutions that offer Health Savings Accounts. “We expect to see not only more employers offering CDH products to their employees, but more employers/consumers demanding CDH products as their value in terms of reducing cost of health care, and as repositories for long-term wealth accumulation being increasingly apparent and prevalent,” he said.

Posted by Wiley Long at 10:39 AM | Comments (0)

December 20, 2009

Time to Enroll in a Health Savings Account for 2010

Health Savings Account participants will receive greater tax benefits than ever before in 2010, thanks to an increase in contribution limits. When Health Savings Accounts are coupled with qualifying high-deductible insurance plans, participants receive hundreds or thousands of dollars in savings each year, making Health Savings Accounts attractive options for many people seeking ways to save money and control health care costs.

"Everyone wants an insurance plan that has low or no deductibles and co-pays for office visits and prescriptions. What they don't realize is that they're paying a lot for those privileges," said Jeff Marshall, director of sales for the AVMA Group Health and Life Insurance Trust. Marshall also notes 25% of Trust participants have Health Savings Account-qualified health care plans.

"If they can afford to self-pay for the smaller things, it definitely behooves them to look at HSA-qualified plans, because the premium differential alone can often save thousands of dollars," said Marshall

To illustrate the savings potential of Health Savings Accounts, Marshall cited a recent example; his company worked with a Florida veterinarian who was looking for a cost-effective alternative to the health insurance coverage he had been enrolled in for years through GHLIT. After evaluating his current health insurance plan options, the veterinarian decided to switch to a Health Savings Account and high-deductible insurance plan through the Trust.

With the new plan, the veterinarian’s annual deductible limit and maximum out-of-pocket expenses increased, but the veterinarian's annual premiums were reduced by half. Ultimately, the veterinarian saves approximately $3,000 per year as a result of the switch to the HSA plan – and more healthcare services and products are covered by the Health Savings Account than by his previous healthcare plan. (See IRS Publication 502, www.irs.gov/publications/p502/index.html, for a list of HSA qualified medical expenses.)

"Premium savings can be invested using pre-tax dollars, up to the annual contribution limit, into an HSA and withdrawn tax free to defray the cost of higher deductibles, co-insurance, and qualified out-of-pocket expenses," Marshall said. "Plus, every dollar they put into that account reduces their taxable income, so it's a real savings vehicle."

The 2010 maximum contribution to Health Savings Accounts increases to $3,050 for individual coverage and $6,150 for those with family coverage. By comparison, the 2009 maximum contribution was $3,000 for individual HSA plans and $5,950 for family plans. Also, Health Savings Account participants aged 55 and older can contribute an additional $1,000 in 2010, which is the same as in 2009.

In addition to lower premiums and tax-free contributions, there are other benefits to enrolling in Health Savings Accounts. For example, many Health Savings Account participants can invest their funds into a wide variety of high-interest yielding investments, including mutual funds, stocks, bonds, certificates of deposit, and money markets. Furthermore, invested funds will grow tax-free for as long as they are in the Health Savings Account.

Health Savings Accounts also be valuable for individuals interested in retirement planning. For example, funds from Health Savings Account can be used to pay the premiums on qualified long-term care plans as well as Medicare premiums, deductibles, co-pays, and co-insurance, excluding only Medicare supplemental insurance and Medigap policies. Additionally, there is no penalty to withdraw Health Savings Account funds to pay for non-qualifying expenses (such as a non-healthcare expense) once a Health Savings Account holder reaches the age of 65 or older.

"The beautiful thing about Health Savings Accounts is that you're lowering your taxable income and your money can grow tax free until you need it," Marshall said. "Most important, you have more control because you're creating your own path for spending your health care dollars."

Individuals thinking about opening Health Savings Accounts should always speak with their accountants or tax advisers before opening the Health Savings Accounts in order to determine whether Health Savings Accounts provide the most advantageous savings potential and healthcare coverage option for their needs. Contact us today for more information about how we can help you get the best Health Savings Accounts for your budget and lifestyle or for more information about Health Savings Account programs in general.

Posted by Wiley Long at 10:33 AM | Comments (0)

December 11, 2009

Health Savings Account Potential: How Health Savings Accounts Could Help to Restore Michigan’s Fiscal Health

Business owners, lawmakers, legislators, and more have spent decades trying to find the perfect healthcare solution for Americans and their families. In fact, the Mackinac Center – a free-market public policy research center in Michigan - has recommended hundreds of reform ideas that could save billions of dollars and help to balance the state budget since 1988.

Currently, the state of Michigan continues to try to find the best solutions to balance the 2010 budget. In the face of these challenges, 2011 is already expected to run rampant with budget deficits and political drama, as the following year is an election year. These challenges promise to be greater than what the state has faced in regards to the last seven state budgets combined. However, one thing is certain: state legislators need to reduce the cost of state government as soon as possible.

One of the most promising solutions to reducing the cost of state government is to implement "Health Savings Accounts" and high-deductible insurance plans as the healthcare solution for government employees. Health Savings Accounts (HSA) are savings account into which participants or their employers deposit pre-tax money that will be earmarked to pay for a participant’s qualifying healthcare expenses. These accounts are accompanied by high-deductible insurance policies that are also called, "consumer-directed health plans," which cover many qualifying healthcare related expenses.

Funds from a Health Savings Account are used to cover qualifying healthcare expenses until the full amount of the health insurance plan deductible is met. Once the deductible is met, the health insurance coverage begins. A 2009 federal law requires that Health Savings Accounts deductibles for qualifying high-deductible insurance plans are least $1,150 for individual self-coverage and $2,300 for family coverage. There are also maximum deductible amounts associated with these accounts.

The benefits of Health Savings Accounts are abundant; as money is deposited into Health Savings Accounts, the money is reduced from the participants’ income tax burden. Those deposited funds then earn interest tax-free and can be withdrawn anytime to pay for qualifying healthcare expenses.

In the case of Michigan state employees enrolling in Health Savings Accounts, the savings can be huge for the state; high-deductible health insurance premiums are less expensive than health insurance premiums for more traditional health insurance plans, including PPO and HMO plans.

Participation in Health Savings Accounts is increasing at a profound rate! The AHIP Center for Policy and Research indicates that participation in HSA/CDHPs increased from 1 million in early 2005 to more than 8 million in January 2009. Moreover, in 2008, large-group Health Savings Account coverage increased by 35 percent and small-group Health Savings Account coverage increased by 34 percent.

The savings potential is significant when Health Savings Accounts are adopted. If one assumes that the state pays 100 percent of the insurance premiums and funds just 75 percent of the legally allowable contributions for each state employee, the state would see a first-year savings of $106 million and cumulative savings as high as $5.9 billion if the plans were used from now through 2021.

There would also be significant savings if the almost 209,000 full-time equivalent rolling public school employees transitioned to a state-administered Health Savings Account/CDHP. The upper-bound savings total could be as much as $451 million in the first year and $26 billion cumulatively through 2021. These estimates are based on expected PPO premium increases of 9.3 percent annually.

While it is true that transitioning state and public school employees into consumer-directed health care plans represents a significant shift in public policy, the potential should still be explored. After all, if nothing is done to address the drastically increasing health care costs, there will be an inevitable shift in public policy as well.

In most cases, employees stand to benefit a great deal through patient-centered Health Savings Account plans that they control. Amongst the milieu of advantages of Health Savings Accounts are predictable expenses for participants; the maximum out-of-pocket expense with Health Savings Accounts/CDHPs is firm, but with traditional insurance, co-pay amounts are unlimited.

While significantly changing state employee health care requires a great deal of effort and communication, Health Savings Accounts are truly beneficial for both employees and for the state. Furthermore, even though the process may result in a struggle over whether the Legislature or the Civil Service Commission is legally allowed to change the benefit structure for state employees, the result of such a shift may help to reinvigorate the state’s fiscal health for decades to come.

Posted by Wiley Long at 08:30 AM | Comments (0)

December 09, 2009

Five Ways a Health Savings Account Can Help YOU Save Money

Enrolling in a Health Savings Account is an excellent way to save a significant amount of money for you and your family. Here are 5 ways that opening a Health Savings Account can make a difference:

1. Health Savings Accounts have corresponding high-deductible insurance plans (HDHP). These high-deductible insurance plans have lower monthly premiums than “standard” insurance plans, which saves you money each month. Lower health insurance premiums = higher savings potential!

2. Keep your money working for you; when you reduce your monthly health insurance premiums, you’ll save a significant amount of money each month. By putting that saved money into your Health Savings Account, you’ll have control over how your money is used. Stop giving away extra money to health insurance companies and start keeping it for yourself and your family!

3. Health Savings Accounts reduce your annual adjusted gross income, which means that you’ll reduce your annual income tax burden. Pay less money in taxes by keeping your Health Savings Account contributions to pay for your own expenses!

4. Health Savings Account funds can be used to pay for HSA-qualifying health expenses that are not covered by your HSA insurance plan.

Plus, a) The money you withdraw from your Health Savings Account to pay for qualifying health expenses can be withdrawn tax-free. b) Paying for healthcare expenses from your Health Savings Account is simple: just use your Health Savings Account debit card! c) Health Savings Account cover many, “qualified” expenses that are not covered by you high deductible health insurance plans, including many dental services, over-the-counter medicines, prescription drugs, eye care needs, hearing aids, and so much more! You’ll save significantly on many health-related products and services.

5. Your Health Savings Account will be available to you for life. If you don’t use the funds from your Health Savings Account now, then let it continue to grow until you need it to cover retirement costs, such as Medicare deductibles and long-term care costs. Plus, there’s not penalty to withdraw money if you’re over the age of 65.

Simply put: Investing in a Health Savings Account is investing in your future. Opening a Health Savings Account can help you save money while growing your wealth and creating a strong financial future. Start today to receive benefits from your Health Savings Account for years to come!

Posted by Wiley Long at 02:15 PM | Comments (0)

December 07, 2009

The Alternative of Health Savings Accounts

More people than ever are choosing Health Savings Accounts. This is good news for the healthcare consumer. Everyone benefits when the country is given more choice when it comes to their healthcare. Health Savings Accounts let you work out a financial plan that works best for your specific needs and decide how to manage your own medical needs.

An added benefit of Health Savings Accounts is making the price of medical care more affordable for everyone, and the prospect of lowering the nation's rising healthcare costs.

So how can revamping the current health insurance system affect healthcare from a financial standpoint?

More to the point, how can a different kind of health insurance make it easier for most people to pay for required medical expenses?

In 2003 the Medicare Modernization Act introduced the concept of HSAs to the American public for the first time. A Health Savings Account is meant to encourage people to invest in their own healthcare through personal savings, and reduce health care costs at the same time; a revolutionary idea that has the potential to be the starting point for positive changes in healthcare. Health Savings Accounts have sparked a lot of debate amongst those who believe in the idea and those who are wary of its ability to change the face of healthcare as we know it.

When you get down to the fundamentals, Health Savings Accounts are truly designed to improve healthcare and make it accessible to the vast majority of people. For the individual, Health Savings Accounts make it easier to pay for medical expenses when they arise. Coupled with a high-deductible health insurance policy, a Health Savings Account allows you to save pre-tax money and earn interest tax-free. This allows you to have money set aside to cover a whole host of medical bills, including items that aren't necessarily covered by traditional insurance plans, such as dental expenses or alternative treatments. Individuals and employers can deposit up to $2700 per person and up to $5450 for a family, and any time you need to withdraw any amount to pay for qualified healthcare costs, you can do so tax-free. In addition, premiums for high-deductible insurance policies can be as little as half the amount of traditional PPO policies.

And because a Health Savings Account is tied to an HSA insurance policy, more expensive treatments are covered, usually 100%, after you've met your deductible. When you turn 65, any savings remaining in the account can be withdrawn tax-free to be used for medical expenses you incur in your senior years. In addition, the savings you accumulate in a Health Savings Account work like a retirement fund. The money grows tax-deferred like an IRA, and you can withdraw the money after age 65 to pay for non-medical expenses without penalty, although you will be required to pay taxes. It is important to note, however, that amounts withdrawn prior to age 65 are subject to penalties and taxes.

Giving the individual more consumer power when making healthcare decisions not only helps you and your family save money, but also creates an environment in which healthcare costs in general become more reasonably priced. Essentially, the price of healthcare is so high because free market forces have little sway in the realm of healthcare products and services. Insurance coverage causes a disconnection between the consumer and the item purchased. When you visit the doctor or purchase a prescription from the pharmacist, you don't know the real price tag. All you see is your insurance payment and the price you pay at the cash register, after your insurance company pays the balance.

This lack of price transparency has led to less competition within the marketplace. People have traditionally chosen their doctors, health products, and other medical items based on location, convenience, or other factors not related to price. When people have the choice to compare different health care providers based on quality of service and price, soon overpriced healthcare will become a thing of the past. People will shop around and force providers to price healthcare more competitively.

As more and more people turn to Health Savings Accounts, medical providers will feel the pressure to post their prices and compete for the consumer's business. Armed with the knowledge of what healthcare actually costs, individuals and families will be less willing to overuse the system, which also drives up prices. (When healthcare appears to cost little or nothing, most people are prone to make use of services even though it may be unnecessary).

At the same time, Health Savings Accounts naturally promote the use of preventive care. When people understand the true costs associated with healthcare, they will be willing to pay a little more up front to keep their engine running smoothly rather than pay a lot more at a later date to fix a problem they could have avoided.

Health Savings Accounts have also put affordable healthcare within reach for more people, who were previously paying medical expenses out-of-pocket due to inadequate or non-existent insurance coverage. The low premiums of a high-deductible HSA plan together with the option of putting your money in a savings account that earns interest has already encouraged large numbers of people who previously went without coverage to purchase a health insurance plan.

Only time will tell whether or not Health Savings Accounts can drive down skyrocketing healthcare costs, but the system created by such accounts, which affords the individual more freedom to control his or her own financial and medical destiny, bodes well for the future of healthcare in America.

Posted by Wiley Long at 02:11 PM | Comments (0)

November 25, 2009

Health Savings Account High Deductible Options

If you are looking for an affordable health insurance plan, then you should look for plans which have a high deductible with a Health Savings Account option. The deductible is the amount which you have to pay out of pocket for healthcare before the insurance company starts to pay for your coverage.

The major costs of a health insurance plan come from the monthly or annual premium and the amount of deductible. Higher the premium, lower the deductible.

But a monthly or annual obligation of high annual premium is a heavy toll on your income and it is regular in nature, so the feel and zeal at having gotten yourself an affordable health insurance gets lost somewhere.

The health insurance providers realized it early on and agreed that the basic key to providing a health insurance plan is high deductible at the time of treatment and claim settlement and low periodic premium. This is based on the simple logic that one never knows when one may fall ill, when that catastrophic ailment or event may strike.

Also, the amount of premium collected in a year is not carried forward for the coverage stock of next year…and it may be ages before you even fall sick if you are a healthy being.

So the best approach to getting an affordable health insurance plan is to check for health insurance quotes that charge low premium and high deductible. Then you can get a Health Savings Account to help cover your deductible.

This saving of yours forms the part of non-taxable income and can be used any time towards the payment of deductible amount as and when the need arises. But this amount cannot be redeemed or utilized towards any other purpose. Otherwise you will have to pay tax on it.

So the best approach to getting an affordable health insurance plan is to check for health insurance quotes that charge low premium and high deductible health plans with a Health Savings Account.

Posted by Wiley Long at 11:15 AM | Comments (0)

November 20, 2009

Health Savings Account Things To Consider

A Health Savings Account is becoming a popular tool to save money for medical expenses. Many employers are providing them in conjunction with a high-deductible health insurance plan so that their employees can afford their deductibles. While Health Savings Accounts are becoming more popular, many people still do not know much about them. Here are six things to consider if you are thinking about getting a Health Savings Account.

1. Pre-Tax Contributions to your Health Savings Account

A Health Savings Account is kind of like a 401k for your health. Just like a 401k, you can deduct a portion of your paycheck tax-free and put it into a Health Savings Account. Deducting a small percentage of your paycheck without taking taxes out will not result in much difference in your take-home pay. Therefore, you can accumulate a pretty nice savings for health expenses this way.

2. Health Savings Accounts Allow You To Budget

When it comes to health care, most people do not budget anything for it. Since health care is such a hard thing to budget for, most people do not account for it until it happens. With a health savings account, you can put away enough money to provide the medical expenses you need. Budgeting a small portion of your income to this makes sense and it will help you avoid large medical bills that you cannot pay.

3. Employer Match to you Health Savings Account

Depending on your employer, they might make a contribution to your Health Savings Account for you. This works much the same way as an employer-match program on your 401k. You contribute so much and your employer will match up to a certain percentage to put in your Health Savings Account. This is a great way to build up funds without investing that much of your own money.

4. Early Health Savings Account Distribution Penalties

A Health Savings Account is designed to save for health expenses only. If you take any of the money out for other reasons before you are 65, you will be penalized for it. In fact, you will have to pay taxes on the money and get hit with a 10% early distribution fee. This means you should stay away from this as a form of saving money for anything except medical fees.

5. Health Savings Accounts Give You More Control

When you have money set aside for your health care expenses, you are automatically given more control over the situation. Many people just go wherever they can go that is the cheapest because they have no money reserved for health care. When you put back enough money in your Health Savings Account, you can choose where you want to go based on treatment and service instead of money only. Getting the treatment you deserve should never be about money and a Health Savings Account can make that possible.

6. Anyone Can Get a Health Savings Account

Contrary to what many people might think, you don't have to be at an employer that offers Health Savings Accounts to get one. You can get one from a bank or any other financial institution. You can still contribute tax free and get all the benefits of a Health Savings Account regardless.

Posted by Wiley Long at 11:14 AM | Comments (0)

November 17, 2009

High Deductible Health Plans and Health Savings Accounts

As the cost of health insurance and healthcare continues to grow, individuals and families are actively looking for ways to lower their healthcare costs. This increased cost, as well as the current health care reform efforts, have been beneficial for a couple of reasons. First of all, it has caused people to creatively look at ways to reduce premium cost. Secondly, it has caused us to consider what real purpose health insurance serves and evaluate our past coverage choices. Let's take a look at the components of using a Health Savings Account plan:

High-Deductible Health Plan (HDHP)

The Health Savings Account (HSA) coverage option has two components. The first component is a high-deductible health plan (HDHP). This is a major medical health insurance policy that has deductible options that meet guidelines established by law. Plans that meet the deductible criteria are considered to be "qualified" high-deductible health plans. There is an inflation factor whereby the deductible guidelines adjust on a yearly basis. These (HDHP) plans are considered comprehensive in the sense that all medical expenses large or small, even doctor visits and prescription drugs, are considered covered expenses and count towards the deductible.

It is important to note that there can be no benefits paid until the deductible is met on a qualified HDHP. For example, there cn be no doctor office co-pay or prescription drug co-pay. Having an up-front benefit of this type would violate the guidelines and disqualify the HDHP. It is important to note that preventative care or wellness benefits are allowed to be covered before the deductible on a qualified HDHP. For plans that use Preferred Provider Organizations (PPO), you also get the benefit of discounted pricing for all medical visits and procedures by a participating provider.

One unique and well accepted feature of the HDHP is that there is only one deductible for a family. This means that the deductible can be met by a single family member having a large medical expense or by all family members combining medical expenses. Once the deductible has been met, the entire family begins to have expenses covered. The expenses after the deductible can be covered at 100% or by a coinsurance percentage until a family maximum out-of-pocket limit is met.

Health Savings Account

The other component is a Health Savings Account (HSA). This is simply a qualified account for making deposits that can later be used for medical care. These accounts may be established with a bank, insurance company, credit union or investment company. The accounts must be "qualified" savings accounts and meet certain criteria established by law, therefore, it is important to verify that the account you are considering meets the qualifications. These accounts are interest bearing accounts and the funds can be accessed by debit card, writing checks or requesting a reimbursement of medical expenses paid. There are limits on the amount that can be contributed to an HSA each year:

2009 contribution limits
-single $3000
-family $5950
*$1,000 catch-up for 55 or older

2010 contribution limits
-single $3050
-family $6150
*1,000 catch-up for 55 or older

Here is the best part. Contributions to the HSA are deductible for tax purposes. This means that routine medical expenses, even things that are not covered under the medial plan such as dental, vision and over-the-counter medicines can be paid for with pre-tax dollars rather than after tax dollars.

Posted by Wiley Long at 12:43 PM | Comments (0)

October 28, 2009

Health Savings Accounts Are Benefiting Employees and Employers

Multiple surveys conducted by ACS Solutions have shown that employees and employers who are using a Health Savings Account and a HSA-qualified health insurance plan are saying they are satisfied with their coverage, spend less on healthcare and are more engaged in managing health benefits.

Tax-favored Health Savings Accounts are designed to help individuals pay for current qualified health care expenses and save for future medical and retiree health care expenses.

“With the vigorous debate over health care reform, and more specifically health insurance reform, the survey results indicate that employers and account holders more effectively control costs and are satisfied with their coverage by utilizing Health Savings Accounts,” said Tom Hricik, national director for Dallas, Texas-based ACS Solution, an administrator of HSA plans. “The survey results also indicate that Health Savings Accounts are being used by account holders as an important vehicle to save for future medical expenses.”

Employers found benefits to Health Savings Accounts, as well. Exactly 86% of those offering the option for more than three years indicated that plan costs were the same or less than the previous year. Almost all employers surveyed (96%) said Health Savings Accounts allow the company to continue offering group-sponsored health insurance.

The surveys were completed in the spring by Buck Consultants, an independent arm of ACS.

The surveys found that 84% of account holders said their HSA-qualified health insurance plans are affordable, and 72% said they pay the same or less than with a traditional type of health plan.

After moving to a Health Savings Account, more than half of account holders said they more closely monitor their health care costs, a finding that supports one of the key claims for how Health Savings Accounts ultimately save money.

Exactly 48% said they read their medical bills more closely, 46% have a better understanding of where their money goes, and about 40% more closely evaluate costs before electing medical services, according to the surveys.

A majority of HSA holders (81%) said the ability to personally control health care costs is an important factor that caused them to select an HSA.

Posted by Wiley Long at 10:28 AM | Comments (0)

October 22, 2009

Health Savings Accounts Are Better Than Flexible Spending Accounts

Not long ago, Flexible Spending Account were all the rage. They allowed you to set aside pre-tax dollars from your payroll check and place it into an account which you could use to pay for medical expenses. Unfortunately, these accounts have many drawbacks and they are no longer as appealing as they once were.

Today, Health Savings Accounts have replaced Flexible Spending Accounts as the preferred pre-tax dollar savings vehicle for healthcare spending. There are many more advantages to Health Savings Accounts which are more appealing to individuals and families.

The main benefit of the flexible spending account is that you can put up to $4,000 dollars per year into the account. That’s un-taxable money which lowers your tax liability come April 15. Technically, there is no federal limit on the amount you can place into the account, but it is usually capped at $4,000.

Lawmakers in Washington are fighting over what to do with these accounts. The ability to be able to place pre-tax money into them makes them one of the most popular depositories for money that is used for medical expenses. Any ‘messing’ with this benefit will smell of a tax increase on the middle class.

On the other hand, there is one reason that you should get out of your flexible spending account if you have one: you use your money by the end of the calendar year or lose it.

Enter the Health Savings Account. This account is also pre-tax contributable and you can also contribute to it on a post-tax basis too. You do not give up your money in a calendar year, either. You keep it and it keeps accumulating in your Health Savings Account with interest until you use it.

Under the flexible spending accounts rules and guidelines, you are asked to provide receipts and proof of purchase for every little charge made on the account. It is watched like a hawk. Health Savings Accounts still have the restriction of only being used for medical expenses, but there are no hawks looking over your shoulder. Should you become the target of an IRS audit, however, you will need to provide receipts for all of your purchases for the year in question.

It is time for the flexible spending account to die slowly. And it would on its own as long as those who are still using them can get a better deal elsewhere – which is possible with a Health Savings Account.

The advent of Health Savings Accounts has been a bright spot in the health care arena for several years now, even in spite of the annual limits that one must adhere to when placing money into the account. Those who do have a better chance of being able to pay for unexpected medical events that occur in their lives. And that is peace of mind that is hard to come by right now.

Posted by Wiley Long at 09:13 AM | Comments (0)

October 19, 2009

Health Savings Accounts Continue to Grow in 2009

According to a Canopy Financial's Health Savings Account Market Report for the first quarter of 2009, the average Health Savings Account balance continues to grow from quarter to quarter.

Canopy found that the average individual Health Savings Account holder for the first quarter of 2009 was 42 years old and contributed $116 monthly, up slightly from an average monthly contribution of $111 for the fourth quarter of 2008. The average family Health Savings Account holder for the first quarter of this year was 45 years old and contributed an average of $239 monthly, up from an average monthly contribution of $206 for the previous quarter.

For the same time period, the average monthly employer contribution increased from $69 to $113 for individual Health Savings Account holders. The average monthly employer contribution rose more significantly, to $266 for first-quarter 2009 from $133 in the previous quarter. The average ages remained the same for the groups from quarter to quarter.

“Consumers enrolled in HSA plans demographically are very similar to consumers of traditional health care,” notes Canopy CEO Vik Kashyap. He also points out “the fact that consumers are clearly using these accounts for saving towards long-term care needs and even retirement.”

First-quarter 2009 average individual HSA balances totaled $960, up from $928 in the fourth quarter of 2008 and from $697 for first-quarter 2008, according to Canopy. Average HSA balances for families also rose, increasing to $1,720 in the first quarter of 2009 from $1,600 in the last quarter of 2008 and from $1,419 in first-quarter 2008.

This trend of increasing contributions, says Kashyap, is noteworthy. “The most significant thing we have noticed is that even in a recession economy, both employers and consumers continue to make contributions to and invest in Health Savings Accounts, which supports the contention that HSA products have become a key/integral component of employer-sponsored health care, and that contributions in many ways mimic those made to 401(k)s in which people invest a little bit each month into these accounts in an effort to accumulate long-term wealth/funds for long-term medical needs,” he tells ICDC.

According to Canopy, the average monthly HSA spend for individuals in first-quarter 2009 was $81, down slightly from $83.54 in the previous quarter. Likewise, the average monthly HSA spend for families was $103 most recently, down from $108.19. Spending on hospital services continued to make up a large amount of the spend for both individual and family Health Savings Accounts over both quarters. Other categories of reported spend include dental services, vision and lab/diagnostic tests.

“The most important take-away for employers is the dollar values held in Health Savings Accounts, and the fact that their employees are using these accounts not only as savings vehicles for long-term medical expenses, but ultimately towards retirement,” maintains Kashyap. “Additionally, as their employees increasingly use a Health Savings Account to manage their health care expenditures, they are becoming much more informed/empowered consumers of health care services, which will play a key role long term in reducing overall health care costs of an organization and the costs associated with managing employer-sponsored health care.”

The report is available at: www.canopyfi.com/hsametrics.htm

Posted by Wiley Long at 09:06 AM | Comments (0)

October 07, 2009

Health Savings Account Balances Increasing

According to data collected by Canopy Financial Inc, a provider of health care banking technology solutions, balances in Health Savings Accounts increased slightly in the first quarter compared to fourth quarter levels in 2008.

The average balance in a family Health Savings Account grew by 7% to $1,720 during the first quarter, while the average balance in an individual Health Savings Account rose 3% to $960.

And compared to the year earlier period, Health Savings Account balances also grew. The average family Health Savings Account balance was $1,419, and the average individual Health Savings Account balance was $697 during first quarter of 2008.

Contributions to Health Savings Accounts have also climbed for both employers and employees.

During the fourth quarter, the average monthly employer contribution was $69 and $133, respectively, for individuals and families. In the first quarter, that increased to $113 for individual Health Savings Accounts and $266 for family Health Savings Accounts.

Similarly, employees are also placing more money into their Health Savings Accounts.

Average contributions for an individual HSA were $111 for individuals and $206 for families in the fourth quarter of 2008. That rose slightly to $116 for individuals and $239 for families during the first quarter.

Steady contributions from employers and employees kept Health Savings Account balances growing amid the recession in the first quarter, noted Vik Kashyap, chief executive of Canopy Financial. “A high percentage of the employers that offer these accounts are contributing into the HSA,” he noted. “They fix the contribution on a monthly basis, so that it’s made irrespective of how the economy is doing.” Interestingly, while employees likely felt the squeeze on their dollars during the first quarter, they were fine with chipping into their Health Savings Accounts, he added.

“You’d expect people to not be contributing, but there’s a tax advantage here,” Mr. Kashyap noted

Health Savings Account holders also increased the amount of money that they transferred to investments.

In the first quarter, Health Savings Account holders transferred an average of $1,372 to investments from individual Health Savings Accounts and $2,633 from family accounts, compared with $1,167 for individual accounts and $1,978 from family Health Savings Accounts in the fourth quarter.

Amounts of money transferred into Health Savings Accounts from investments also rose, with an average of $722 transferred in from investments for individual accounts, up from $540 in the fourth quarter.

Meanwhile, on the family side, the amount transferred from investments dropped, falling to $1,157, from $1,556 in the fourth quarter.

Posted by Wiley Long at 09:17 AM | Comments (0)

October 05, 2009

Can a Health Savings Account Help Your Business?

One option that can help small businesses struggling with healthcare is a Health Savings Account. Small businesses are constantly looking for ways maintain overhead while still providing quality employee benefits. Money placed in Health Savings Accounts are not subject to federal income tax when deposited. Health Savings Accounts are designed to allow taxpayers to set aside funds to cover the costs associated with medical care. Individuals can benefit from using a Health Savings Accounts as a way to cover their out-of-pocket medical expenses.

Benefits of Health Savings Accounts

Here are some of the ways that Health Savings Accounts save money for individuals and small business owners who participate:

* The tax break that covers the funds deposited in Health Savings Accounts is passed on to the individual account holder. The more money deposited in the account, the less federal income taxes the account holder will have to pay.

* Health Savings Accounts are coupled with an HSA insurance (also known as high-deductible health insurance) plan that is the responsibility of the individual. This means employers do not have to assume the costs associated with group health insurance plans.

* Health Savings Account funds can be rolled over into the next year. There are no restrictions or penalties for not using all of the funds in a calendar year.

* Health Savings Accounts accrue interest over time and roll over from year to year.

Health Savings Accounts are excellent alternatives for small business owners wishing to help employees stay healthy and manage the costs of healthcare. They feature less risk for the employee and more benefits for the individual. Implementing Health Savings Accounts in a small business is evidence of the employers concern for the welfare of employees, yet it is an affordable and manageable option at the same time.

Health Savings Accounts for Companies Large and Small

While Health Savings Accounts are great for individuals and small businesses, larger businesses are also turning to them as a means of covering employees that are not benefited by health insurance plans. Industry leaders like Walmart and UPS have developed Health Savings Account programs to extend a helping hand to some of their employees.

Overall, Health Savings Accounts are a unique alternative to expensive health insurance programs. They provide small businesses with the level of affordability and flexibility that is desperately needed in these tough economic times.

Posted by Wiley Long at 03:58 PM | Comments (0)

September 21, 2009

Health Savings Accounts - You Can Benefit By Owning One

In today's economy, everyone can use a financial advantage. One way to get a financial advantage for your health insurance is to raise your deductible so you can lower your monthly health insurance premiums. If you raise your deductible to at least $1,150 for single coverage or $2,300 for family coverage, you can take advantage of a Health Savings Account. With a Health Savings Account, you can make a tax-deductible contribution of up to $3,000 (or $5,950 for family coverage) in 2009, which you can use tax-free for medical expenses in any year.

A Health Savings Account (HSA) can be particularly beneficial for early retirees, who can cut their premiums substantially by raising the deductible (you can also contribute an extra $1,000 if you're 55 or older). For instance, a healthy 55-year-old man in Illinois can get a Humana HSA eligible policy with a $5,200 deductible for $207 per month, or $179 with no drug benefit.

You can't contribute to an HSA after you sign up for Medicare, but you can use the money tax-free for medical expenses at any time, and you can use it penalty-free for anything after age 65. You can even use HSA money to cover premiums for Medicare parts A, B and D, and for Medicare Advantage plans (but not to pay medigap premiums). An HSA can also help pay qualified long-term-care premiums.

Learn more about Health Savings Accounts and how they can benefit you at HSA for America.

Posted by Wiley Long at 10:47 AM | Comments (0)

September 18, 2009

Health Savings Accounts Growing Survey Shows

Health Savings Accounts continue to be adopted widely, with an ever-growing number of accounts and assets, according to a recent survey by Celent.

Participants in the latest Health Savings Account benchmarking survey from Celent, conducted between January 2008 and January 2009, reported a 46.1 percent increase in the number of Health Savings Accounts. During the same period, survey participants saw their asset base grow by 62.6 percent.

According to Celent executives, Health Savings Accounts should survive current efforts by Congress and the Obama administration to reform healthcare because they repesent one of the fastest-growing retail banking products.

Between January 2008 and January 2009, the survey reported, average account balances grew by only 13 percent, to $1,561. Officials attributed the low growth rate to a high number of unfunded accounts (accounts with no contributions during the preceding 12 months), which stood at 18 percent. This is due to a relatively high number of accounts coming online in January 2009, as well as a failure by some banks to purge inactive accounts.

Other key findings include:

* Investments fell of 5 percent of total assets, mostly likely due to the recessionary environment, unemployment and falling investment values. For larger Health Savings Account players, the number of accounts with investment balances barely registers; such accounts made up only 1 percent to 2 percent of all accounts.

* Specialist segment players are enjoying increased revenue per account, up to $84. This growth can be largely traced to improved management of DDA margins/spreads.

* In terms of distribution, the top 25 and specialist segments are moving to resemble each other. Top 25 players are gaining more sales through health plan channels, and specialists are building more business in the direct-to-employer channel.

* Debit cards are attached to almost all Health Savings Accounts, but are only used for 66 percent of the funds disbursed. Checks continue to hold a good share (20 percent) of disbursements, while a new disbursement method, integrated payments, accounts for 1 percent of dollar volumes.

"Health Savings Account pricing continues to decline, with average collected monthly fees now hovering just above the $2 mark," said Red Gillen, a senior analyst with Celent's banking group and author of the report. "In fact, some Health Savings Account players are even preparing for the eventuality when Health Savings Accounts go the way of checking accounts – in other words, free."

Learn more about Health Savings Accounts and how to find the best HSA Insurance for your needs at HSA for America.

Posted by Wiley Long at 11:31 AM | Comments (0)

September 13, 2009

Health Savings Account Are A Great Investment

Investing for the future is something the majority of us are taking into consideration, especially with the current financial crisis. We want to save and invest for our future. Perhaps one of the best investments today is a Health Savings Account.

One of the main reasons Health Savings Accounts are considered to be a good investment is that you will have full control of where to invest your money. You can decide to invest your money in stocks, mutual funds, bonds, or any investment channel, with the bank of your choice acting as your Health Savings Account administrator.

Health Savings Accounts are often regarded as a second retirement investment. One of the attractions about this type of account, as an investment, is that the funds that you put into it are permitted to grow minus the taxes that are often associated with other investment schemes. This little trick will help you to earn a better return with on your money.

Another benefit that you can get from investing in your Health Savings Account, is that you can use the funds to pay for your medical expenses. There are health expenses that your health care insurance, like Medicare, will not be able to cover for you, but your Health Savings Account will assume.

This an important facet of Health Savings Accounts, now that the cost for health care is soaring rapidly. This account is your best tool to build up your funds necessary to shoulder the rising cost of health care; once you retire from your full time employment. This is the only account where you can withdraw money practically tax-free to shell out for your medical costs.

The amount that you can earn from your Health Savings Account is dependent on the following factors:

1. Amount of your annual contributions.
2. Length of time that you have contributed.
3. Your investment return.
4. Length of time before you withdraw funds from your account.

You can always get the most out of your Health Savings Account as follows: (1) you can take the risk and invest the funds into high yielding investment vehicles such as the stock market, and the likes; (2) do not make any withdrawals from your Health Savings Account for as long as possible; (3) deposit the maximum amount of money you can make at the start of each year.

In a capsule, to increase your ROI on your Health Savings Account is to fund it annually, preferably at the start of the year, put the money to work wisely and delay any withdrawals.

Learn more about Health Savings Accounts at HSA for America.

Posted by Wiley Long at 10:44 AM | Comments (0)

September 07, 2009

Health Savings Account Benefits

"Health is Wealth" is not a very common phrase. But the unpredictability in our lives has made it imperative to have a Health Savings Account. A Health Savings Account will help ease the financial pressure in our later years in life and in an emergency situation.

Below are benefits of a Health Savings Account and how they can help you now and in the future:

* The usage of money in a Health Savings Account is totally dependent on the person who opens the account. However, in case of the money being used on non-qualified medical expenses, the benefits are lost.

* In case of company sponsored health insurance, there is no facility for a rollover from year to year. If you open a Health Savings Account yourself, you get the benefit of a rollover.

* A Health Savings Account is immune to income tax liabilities. So the amount of money saved will be more and fast.

* Health Savings Accounts are quite easy to open. All you need is a high deductible health insurance plan to open a Health Savings Account with a bank.

* In most instances, the account holder also gets a debit-type card, which can be used for the qualified medical expenses.

* The contribution to your Health Savings Account by your employer are excluded from your taxable income.

Those who support Health Savings Accounts propose that these accounts will bring down health care costs, as well as, enhance the efficiency of the health care system. However, the usage of the amount in a Health Savings Account for non-qualified medical expenses can result into lapse of the benefits. So it is advisable that it is used only for qualified medical expenses.

Some of the expenses which come under HSA qualified medical expenses for Health Savings Account are for the treatment of acupuncture, alcoholism, birth control pills, blind services, crutches, hearing aid and batteries, Domestic Aid (rendered by nurse), drug addiction Recovery, drugs - prescription or over-the-counter, Dyslexia Language Training and Hearing Aids. It is also applicable for hospital care, insulin, laboratory fees, Lifetime Medical Care prepaid; retirement home, artificial limbs, nursing Services and obstetrical expenses.

Similarly, some of the non-qualified HSA medical expenses (these don't qualify for the usage of money from a Health Savings Account) are babysitting, childcare, cosmetic surgery, dancing lessons, funeral expenses, future medical care, hair transplant, liposuction, medicines imported from another country, swimming lessons, teeth whitening and weight-loss program.

Learn more about Health Savings Accounts at HSA for America.

Posted by Wiley Long at 10:54 PM | Comments (0)

September 01, 2009

How a Health Savings Account Will Save You Money

Healthcare costs rise every year for all Americans - employer, employee, self-employed, and their families. The US government is working on this, but their track record on reform is not so good (or fast). Meanwhile, Americans pay more and more for basic health care, at a time when many mortgages are going up and many people are unemployed or underemployed.

One solution that has worked for more and more families each year is the Health Savings Account. 10 reasons to consider a Health Savings Account:

1) Health Savings Account premiums are vastly cheaper than other healthcare plans.

You are immediately saving money. The renewal costs are also much cheaper than an HMO, PPO or other plans.

2) Health Savings Accounts will cover peripheral medical costs.

With many HMOs or PPOs, dental care, eye glasses, and eye surgery are not covered. Health Savings Accounts can be used for this, and also acupuncture, psychiatric treatment,fertility treatment and more. See IRS Publication 502.

3) You control your medical care with a Health Savings Account.

There is no network. No one will force you to choose from a list of doctors or hospitals. With a Health Savings Account, you play an active role in every healthcare decision. Even the best doctor may benefit from having to explain his or her recommendations when you ask the right questions about your healthcare.

4) Health Savings Accounts are tax-deductible.

All the money you deposit into your Health Savings Account is tax-deferred. Even if you spend it all on approved medical expenses, the money is still deductible.

5) Money saved in a Health Savings Account never expires.

Unlike a flexible spending account, the money in your Health Savings Account can grow for years until you need it.

6) Health Savings Accounts can be filled from an IRA.

You can pay for your health care from your retirement account - one time. If you're short on cash, you can take a bit from your retirement and transfer to your Health Savings Account without a penalty.

7) With a self-directed Health Savings Account, your health care dollars can be an investment.

Your Health Savings Account money can join with your self-directed retirement funds and invest in real estate, gold, stock, or a loan.

8) Health Savings Account investment earnings are tax-deferred.

If you make a good investment and earn thousands, that money will stay in your Health Savings Account until you need it, tax-deferred.

9) Health Savings Account money earns interest when you're not using it.

If you can't find a good investment, or between investments, the money in your Health Savings Account earns tax-deferred interest.

10) Contrary to common sense and popular belief, health care costs are not tax deductible for most Americans.

Healthcare costs must be 7.5% of your income to be tax deductible. Most Americans do not qualify for this, even in a bad health year.

Learn more about Health Savings Accounts and how to get the best HSA Plan for your needs at HSA for America.

Posted by Wiley Long at 05:23 PM | Comments (0)

August 27, 2009

Study Shows Health Savings Accounts Growing at Rapid Pace

A new report entitled "HSA Benchmarking Analysis: Market Trends and Economics 2009" which was released by Celent, a Boston-based financial research and consulting firm, shows the number of Health Savings Accounts and assets held in HSA plans continues to grow despite the downturn in the economy.

From January 2008 to January 2009, there was an increase of 46.1% in the number of Health Savings Accounts. During that same period, HSA administrators reported that assets grew by 62.6%. The report also shows during that same time period not a single HSA administrator experienced a decrease in balances.

That phenomenon reflected a shift in the health care marketplace. As the economy deteriorated and employers looked to cut costs, these high-deductible health plans became more attractive to employers and employees. These HSA health plans are cheaper for employers to offer and less costly for employees to purchase.

The study is based on data released to Celent by 14 HSA administrators. The report referred to Health Savings Accounts as the “darling of retail banking” because of their growth rates, which are unmatched by any other retail banking product.

Health Savings Accounts are expected to continue to grow in 2010. You can learn more about Health Savings Accounts and find an HSA Plan that is right for you at HSA for America.

Posted by Wiley Long at 12:53 PM | Comments (0)

August 24, 2009

Using a Health Savings Account While on Medicare

I received this question recently: My wife and I turn 65 this year and will sign up for Medicare. Will we still be able to use the money in our Health Savings Account?

The Answer: You sure can!

Even though you can't contribute to a Health Savings Account after you sign up for Medicare, you can keep the Health Savings Account and use the money tax-free for medical expenses. In fact, you can use the money in your Health Savings Account for anything after age 65, although you will owe taxes on withdrawals for non-medical expenses.

There are plenty of medical fees to which you can apply the money. For example, you can tap the account for Medicare deductibles and co-payments. You could also use Health Savings Account money to cover premiums for Medicare parts A, B and D (prescription-drug coverage), and to pay Medicare Advantage premiums. And you can use Health Savings Account money to help pay qualified long-term-care premiums. However, you can't use Health Savings Account money tax-free to pay Medigap premiums.

Learn more about Health Savings Accounts at HSA for America.

Posted by Wiley Long at 09:15 PM | Comments (0)

August 21, 2009

Health Savings Accounts Provide Tax-Free Health Care Savings Now

Many Americans are feeling the pinch these days from ever-increasing health care costs, and a comprehensive solution to this problem still needs to be found. That being said, a Health Savings Account can ease the burden of high deductibles in the here-and-now. Anyone under the age of 65 who purchases an eligible high-deductible health insurance plan - either through an employer or on their own - can set up a Health Savings Account, which supplements high-deductible health insurance policy coverage through the use of tax-free, user-contributed savings.

For the 2009 tax year, a policy qualifies as high deductible health insurance plan if it meets both of the following conditions:

* The policy’s annual deductible is at least $1,150 for an individual or $2,300 for a family.

* Yearly out-of-pocket health care expenses do not exceed $5,800 (individual) or $11,600 (family).

Eligible policyholders can add funds to their Health Savings Account by contributing up to $3,000 per year in pre-tax income (up to $4,000 per year if you’re 55 or older). Health Savings Account users also earn tax-free interest on their contributions, and fee-free withdrawals can be made at any time for health care expenses. Employers can contribute funds to Health Savings Accounts as well, and unlike a flexible spending account there is no “use by” deadline tied to a Health Savings Account.

Even though there are substantial tax and savings benefits to a Health Savings Account, it also contains drawbacks in the form of limited usage and contribution amounts. Users who withdraw Health Savings Account funds for any purpose other than health care are hit with heavy penalty fees, and the yearly maximum for contribution amounts is relatively small compared to the astronomical cost of a major medical procedure not covered by insurance. Despite these limitations, however, Health Savings Accounts provide eligible policyholders with a long-term, cost-effective way to offset out-of-pocket health care costs.

Get more Health Savings Account information at HSA for America.

Posted by Wiley Long at 01:20 AM | Comments (0)

August 15, 2009

Health Savings Accounts Are A Great Option For The Uninsured

Consumers have begun a quiet revolution, as Congress continues to propose and debate trillion dollar options for health insurance. Data being reported from several sources shows Health Savings Accounts are beginning to make a dent in the uninsured market.

The increase in Health Savings Accounts is growing in both the individual market as well as the group market. The option is especially appealing to small business owners who can contribute something to their employee's Health Savings Accounts, save on premium, and still be paying less than they paid for their traditional PPO group coverage.

Even more surprising is the demographic that is buying Health Savings Accounts. Once thought to be appealing only to the rich, the young and the healthy, several majors insurers have reported an unexpected trend.

40% of those buying HSA-qualified health inusrnace plans and investing in Health Savings Accounts are reporting average income of under $50,000. One company, Assurant Health, reports that 27% of those purchasing HSA insurance plans and opening Health Savings Accounts have a net worth of less than $25,000.

The most encouraging news which is being reported by three different insurance sources is that 33 – 40% of those buying HSA plans with Health Savings Accounts were formerly uninsured.

American Health Insurance Plan (AHIP), a national association which represents 1,300 member companies who provide health insurance to more than 200 million Americans, reported that over 8 million Americans now have Health Savings Accounts, an increase of more than 31% since January 2008.

Posted by Wiley Long at 11:05 AM | Comments (0)

August 12, 2009

Health Savings Accounts at Work

Below is a personal story of Health Savings Accounts at work. It illustrates the tax benefits, choice benefits, and a cost benefits associated with Health Savings Accounts. With healthcare reform taking center stage these days, I wanted to share with you another option that should be consider in the healthcare debate: Health Savings Accounts.

Sound Mind Investing went to Health Savings Accounts for our employees in 2006. So with three years under our belts, we can vouch for how they affect spending decisions. Here's how they recently affected mine.

Let me first say that my wife Kim and I have been trying to pay our health care expenses out-of-pocket so that we can use our HSA as another type of retirement vehicle. And since we're more or less keeping our hands off of it, we might as well invest it, right? So every month, the company makes a deposit into our HSA which is held by The Sound Mind Investing Funds and used to purchase shares of SMIFX.

Now this is a great way to plan for retirement, but it's not cheap because remember, we're paying our health care costs out-of-pocket, NOT out of our HSA. So last year, when we had another baby, we had to have the cash to pay for the doctors and hospital visits if we didn't want to use some of our HSA investments in SMIFX.

But there's some good news. Once we meet our deductible, everything over that deductible is paid for by our insurer. So when December rolled around and we had finally met our deductible, I promptly scheduled visits to a chiropractor. I also scheduled a visit to a new allergist as it had been a while since I had been tested for allergies. It's a painful enough procedure without the cost. So at least getting it done for "free" helped soothe the burn a little.

Furthermore, our health plan covers prescriptions after the deductible is met. And wouldn't you know, the allergist prescribed three new medicines. We're on mail-order prescriptions where they send three month's worth at a time. This amounted to $600 worth of medicine that I didn't have to pay for. But I needed to get these prescriptions in before the end of 2008 because come 2009, we're back to paying everything ourselves. This is an HSA at work.

Fast forward to about four weeks ago, I started having heart palpitations. I'm a reasonably healthy guy and was a little concerned. I seem to read a story every year about some super fit athlete who dies unexpectedly from an undiagnosed heart ailment. But here's the thing - if I were going to be tested, it was going to cost me. It came down to peace of mind vs. what will likely be $1,000 worth of EKG's, stress tests, and Holter monitors. I decided it would be prudent to have the testing done regardless. As it turned out, my tests came back with good results. So yes, I'm paying a lot of money for what amounted to assurance. But that's okay. It was my decision. This is an HSA at work.

Fast forward to this morning. I've been battling a cold for a while, so when I was getting my allergy shots yesterday, I made an appointment for this afternoon with my allergist. But when I woke up, I felt a lot better. Cough was more or less gone and my voice was no longer hoarse. So I had a decision: Pay for a doctor visit when I'm potentially on the mends or forgo it and hope for the best? I canceled it first thing. This is an HSA at work.

Health Savings Accounts are the real deal. There's a tax benefit, a choice benefit, and a cost benefit. They give the consumers the freedom to spend or save or invest based on what's best for his or her life situation. Giving the consumer the ability to decide for themselves how best to manage their health care costs - and pocket the savings - is an HSA at work.

This story was originally posted by Matthew Pryor on the Sound Mind Investing Healthcare Blog at http://www.soundmindinvesting.com/weblog/health-care/

Learn more about what a Health Savings Account can do for you at HSA for America.

Posted by Wiley Long at 09:53 AM | Comments (0)

July 07, 2009

Health Savings Account Contribution Limits Set to Rise

The Internal Revenue Service has said the maximum Health Savings Account contribution is set to set to increase in 2010. Also set to increase is the minimum deductible imposed by health insurance plans linked to Health Savings Accounts and the maximum out-of-pocket expenses that employees can be required to pay.

The maximum contribution that can be made to an HSA in 2010 for employees with single coverage will be $3,050, up from $3,000 in 2009. The maximum HSA contribution for those with family coverage will rise to $6,150, up from $5,950.

Additionally, the maximum out-of-pocket expense, including deductibles, that employees can be required to pay next year will rise to $5,950 for single coverage, up from $5,800 this year, and $11,900 for family coverage, up from $11,600.

The minimum deductible of the high-deductible health insurance plan to which Health Savings Accounts must be linked will increase next year to $1,200 for single coverage and $2,400 for family coverage. The current minimum deductibles are $1,150 for single coverage and $2,300 for family coverage.

Learn more about what a Health Savings Account can do for you at HSA for America.

Posted by Wiley Long at 08:58 AM | Comments (0)

June 19, 2009

Over 8 Million Now Enrolled In Health Savings Accounts

A new census release by America's Health Insurance Plans (AHIP) has found that over 8 million Americans are covered by Health Savings Account eligible insurance plans which is 31 percent increase since last year. Since 2004, when Health Savings Accounts were created, AHIP has conducted a periodic census of its members participating in the Health Savings Account market.

Another report by AHIP found HSA account holders have a broad range of incomes across the country. The report, Estimated Income Characteristics of HSA Account holders in 2008, used a geo-coding technique to estimate the income characteristics of HSA account holders.

"HSA plans provide coverage to a number of consumers of all ages and incomes across the country, and they represent an important choice for employers and individuals when looking at the portfolio of coverage options available," said Karen Ignagni, President and CEO of AHIP.

Key findings from the census include:

- There was an increase of approximately 1.9 million Americans enrolled in an HSA plan since January 2008. Previous AHIP census reports found that 6.1 million were enrolled in January 2008, 4.5 million were enrolled in January 2007, 3.2 million were enrolled in January 2006, and 1.0 million were enrolled in March 2005.

- 30 percent of individuals covered by an HSA plan were in the small group market, 47 percent of individuals covered by an HSA plan were in the large-group market, and the remaining 23 percent were in the individual market.

- A majority of HSA enrollees are covered by Preferred Provider Organization (PPO) products (83 percent) and Health Maintenance Organization (HMO) products (10 percent). In the individual market, almost 92 percent of enrollees in HSA plans were in PPO products, while approximately 85 percent of enrollees in large-group and 76 percent of enrollees in small-group HSA plans were in PPO plans.

- States with the highest levels of HSA/HDHP enrollment were California (854,000), Florida (524,000), Illinois (497,000), Texas (476,000), Ohio (464,000), and Minnesota (388,000).

Key findings from the income characteristics analysis include:

- Households with a wide range of incomes hold HSA accounts, with almost half (49 percent) of account holders living in neighborhoods with median incomes under $50,000 (incomes based on 2000 Census data).

- Average total deposits (including personal deposits, employer contributions, and interest) for all HSA accounts were $1,634 and average total withdrawals (including fees) were $1,063.

Learn more about Health Savings Accounts at HSA for America

Posted by Wiley Long at 01:43 PM | Comments (0)

June 16, 2009

Americans Want to Keep Health Savings Accounts as a Savings Option

OptumHealth Inc. has release a survey that shows Health Savings Account owners are extremely satisfied with their Health Savings Accounts and they believe their Health Savings Accounts should remain a savings option for Americans. More than 80 percent of respondents cite their ability to save for future health care expenses as the primary reason for opening and depositing money into their Health Savings Accounts. The survey also found that 70 percent of Health Savings Account participants make $75,000 a year or less in income.

"Health Savings Accounts have very strong support across a broad range of income levels and are helping people be better health care consumers," cited Chad Wilkins, CEO of OptumHealth.

OptumHealth’s survey found 82 percent of Health Savings Account (HSA) owners are satisfied with their accounts; 78 percent believe the continued availability of Health Savings Accounts should be part of any health care reform that may occur; and 74 percent agreed they would recommend an HSA to a friend or family member. Three out of 10 respondents said that they wouldn’t have health insurance if it were not for their Health Savings Accounts.

The study also showed that HSA owners are engaged with their financial and physical well-being. For example, 64 percent of the respondents said they inquired about generic options for medication and 47 percent indicated they asked their care providers about charges.

HSA owners also agree that people need to become more engaged in their health care. The survey found that 83 percent of respondents agreed people should research health care options and try to get the best price — just like they do for other major consumer purchases; 72 percent of respondents said that individuals should be responsible for helping to manage their own health care costs.

Employers are increasingly turning to consumer directed health plans (CDHPs) and Health Savings Accounts to provide health coverage to their employees and dependents. According to a Watson Wyatt Worldwide and National Business Group on Health survey, 51 percent of companies now have a CDHP in place, a 9 percent increase from last year. Inside Consumer-Directed Healthcare reported that the number of Health Savings Accounts grew about 40 percent year-over-year as of January 2009 and average savings balances grew 45 percent.

“With increased employer demand, more HSA use by consumers and the positive responses from our survey, it is clear that these accounts are valued as a tool to help people meet their health care needs,” Wilkins said.

The survey was conducted online by an independent research firm between Feb. 27, 2009, and March 20, 2009, with a random national sample of 500 HSA owners.

The survey measured satisfaction level, motivations for having an HSA and effects the accounts had on engaging people in managing a portion of their health care savings and spending. Participants had an HSA for at least one year, were covered by a high-deductible health plan and had an active HSA at the time of the survey. Margin of error for the survey was 4 percentage points or better with 95 percent confidence.

Health Savings Accounts are tax-free health spending and savings accounts available to individuals and families who have qualified high-deductible health insurance policies as determined by IRS regulation. OptumHealth Bank, Member FDIC, is one of the largest administrators of Health Savings Accounts, with about 500,000 accounts and nearly $800 million in HSA deposits and investments.*

Posted by Wiley Long at 11:01 AM | Comments (0)

June 07, 2009

Health Savings Accounts Are The Wave Of The Future

The need for reduced health care cost brought about the formation of Health Saving Accounts in 2004. Since then, their use has grown exponentially by American consumers. Most people will agree that health insurance is too expensive especially if you have a family to cover. Deciding which policy makes the most sense can be confusing with all the co-pays, premiums, deductibles, and features. This is where Health Saving Accounts can make it possible to get great coverage with a reduced premium and have a reserve expense account for when a major medical expense does occur.

Why Use A Health Savings Account?

Most consumers choose health plans with low to medium deductibles and co-pays for doctor visits and prescription drugs to defray the cash outlay for health related expenses. Deductibles are the amount you the consumer pay before your insurance kicks in to cover the difference. While these traditional plans can ease the pinch on the pocketbook at the initial appointment or at the pharmacy, you actually pay for these features in the form of a higher premiums.

The concept behind Health Savings Accounts is that you choose a plan with a high deductible because plans with higher deductibles have much lower monthly premiums. The savings in premium for the high deductible plan is then placed into a HSA account owned by you. The contributions to the HSA are 100% tax deductible from your income up to the legal limits and the money accumulates tax deferred sort of like an IRA for health care. As long as the money is used for any qualified health care cost then it is also tax free. The best part is the contributions are yours to keep and they continue to accumulate interest. If you change jobs or become self employed the HSA account goes with you, and unlike Flexible Spending Accounts that have the “use it or lose it provision” these accounts do not forfeit your contributions.

Is A Health Savings Account Right For Me?

Health Saving Accounts were originally created as a tax deductible medical insurance program with the self employed consumers in mind, but were quickly recognized as a viable solution to better manage health care cost for all Americans. Some advocates believe that Health Saving Accounts are geared primarily toward wealthy self employed families in good health who need a low cost plan for any major medical expenses. Clearly it makes more sense for somewhat healthy individuals to benefit more from the cash accumulation than someone who actively is tapping into their insurance because of health issues. The consumer market says these plans are growing in favor within only a few years over 3 million have signed up for HSA plans and that number is expected to be over 30 million by 2010. Determining if an HSA is right for you will require you to consider your current health insurance cost and how you feel about covering the smaller healthcare expenses in exchange for a lower premium. The savings in premium can be substantial and once you have fund accumulation you will have enough to cover doctor visits co-pays prescription and deductibles. The benefits of the HSA are twofold; Lower overall insurance premiums and a self managed tax deductible medical expense account. One of the greatest uses in our current economy with the suffering employment market would be the ability to use a HSA account to fund a short term medical plan for a consumer or family income earner who has lost their employer sponsored health insurance plan.

How Do I Enroll in an Health Savings Account Program?

Most major health insurers such as Assurant, Blue Cross Blue Shield, Humana, United Health Group Golden Rule and Aetna provide Health Savings Accounts right alongside their traditional medical insurance programs. Our HSA for America website has carrier links that spreadsheet the different plans side by side for you to compare. We also provide you a personalized comparison to show how you might save by making the switch from traditional plan to an HSA plan. Many of the carriers have already established bank accounts with debit cards allowing you to sign up for the programs all at the same time.

Health Savings Accounts are clearly a viable option and will likely continue to offer more features and options as more consumers learn about them and employers begin to introduce them. The long term benefit is better managed health care and lower overall cost to consumers.

Posted by Wiley Long at 10:36 AM | Comments (0)

June 04, 2009

What Health Savings Accounts Can Do For You

Health Savings Accounts were introduced in 2004 and allow individuals to pay for medical services upfront through funds they deposit tax-free into their personal Health Savings Account. A required insurance policy then kicks in for catastrophic expenses. Any unused funds build up from year-to-year and collect interest in the process.

Put simply, no other investment account has the tax advantages that Health Savings Accounts do. Throughout the life of a Health Savings Account its owners can withdraw funds for qualified medical expenses tax-free. Because of this, taxpayers should consider fully funding their Health Savings Accounts first, before any other type of retirement accounts.

With health care costs continuing to outpace wage increases and companies trimming retiree health benefits, financing health care has to be central to retirement planning.

The beauty of Health Savings Accounts is that they can be used to pay Medicare premiums, out-of-pocket expenses, long-term care insurance premiums, and many long-term care expenses, say researchers. Even better, Health Savings Accounts can do all of this tax-free.

However, if you don't end up incurring these types of expenses, you can still use your HSA funds for other purposes and pay only regular income tax on your withdrawals after age 65.

Learn more about Health Savings Accounts and their benefits at HSA for America.

Posted by Wiley Long at 11:42 AM | Comments (0)

May 26, 2009

Health Savings Accounts Come to Puerto Rico

Health Savings Accounts have now been established in Puerto Rico. Puerto Rico will now allow contributions to the accounts to be exempt from personal income tax, and will apply to the taxable years that commence on and after January 1, 2009. Under Health Savings Accounts, the insured will choose the provider and/or health service that they want to receive payment and will pay for those services with the funds that had accumulated in their Health Savings Account, covering up to the total annual deductible.

The employee and the employer both may make contributions to the Health Savings Accounts. Once the insured has covered the high annual deductible, either charging the HSA qualified expenses eligible for medical attention to the funds in the Health Savings Account or with another source of funds, coverage from the traditional medical plan will begin.

The Health Savings Accounts will allow annual contributions that are not considered income received by the taxpayer, that are deductible when taxed, and after the first year are converted into a savings vehicle with tax benefits. Upon reaching the age of 65 years, the owner of the Health Savings Account may withdraw the accumulated funds and use them for any purpose (it does not require a medical expense) without having to pay penalties, but will pay tax on the withdrawn amount. Amounts deposited in a Health Savings Account beyond the limits for each year are subject to a 6% penalty.

Posted by Wiley Long at 09:50 AM | Comments (0)

May 21, 2009

Study Shows Health Savings Account Contributions Increasing and More Employers Offering HSA Plans

In their annual survey of employer health benefits, the Kaiser Family Foundation and the Health Research & Educational Trust found that more employers are offering Health Savings Account plans and that employer contributions to Health Savings Accounts doubled since 2007.

The study showed that 13% of firms offering health benefits now offer a Health Savings Account Plan with an Health Reimbursement Arrangement in 2008. While the report notes that the increase does not represent a significant difference from the 10% reported in 2007, they do point out that there has been a statistically significant increase in the offer rate since the 7% reported in 2006.

As for the types of employers who have adopted Health Savings Accounts, the study found that firms with 1,000 or more workers are more likely to offer a Health Savings Account than smaller firms. Twenty-two percent of firms with 1,000 or more workers offer a Health Savings Account compared to 13% of firms with 3 to 199 workers or 15% of firms with 200-999 workers.

The study also found that workers enrolled in HSA-qualified plans on average receive an annual employer contribution to their HSA of $838 for single coverage and $1,522 for family coverage. These amounts are about double the amounts reported in 2007 ($428 for single coverage and $714 for family coverage), but this increase may be due in part to a change in legislation enacted by Congress in December 2006 that increased the maximum allowable annual HSA contribution. Although the increased amounts were allowed in 2007, due to the timing of the legislation, employers may not have had time to introduce higher contributions in 2007. When those firms that do not contribute to the HSA are excluded from the calculation, the average employer contribution for covered workers is $1,139 for single coverage and $2,067 for family coverage.

Here are some other key findings related to HSA funding:

* Small employers have significantly increased contributions: From 2007 to 2008, the amount contributed to Health Savings Accounts for workers in small firms increased from $415 to $1,041 for single coverage and from $677 to $1,862 for family coverage. There was no statistically significant increase in HSA contributions for workers in large firms for either single or family coverage.

* Not all employers are making contributions to employees’ accounts: In looking at employer contributions to Health Savings Accounts, it is important to note that not all employers make contributions towards Health Savings Accounts established by their employees. Twenty-eight percent of employers offering single or family coverage through HSA-qualified plans do not make contributions towards the Health Savings Accounts that their workers establish (covering 26% of covered workers enrolled in HSA-qualified plans for single or family coverage).

* But, the number not contributing is quickly decreasing: For single coverage, the percentage of firms that do not make a contribution to Health Savings Accounts established by their employees decreased from 66% in 2007 to 28% in 2008. The report notes, however, that the 2008 percentage is similar to the percentage that was reported in 2006 (37%).

This year, the survey included questions for those employers offering Health Savings Accounts on their opinions of the most successful outcome, biggest challenge, employee satisfaction, and primary reason for offering a Health Savings Account. Not surprisingly, forty-two percent of firms report that in their opinion, lower costs as the most successful outcome from offering a Health Savings Account.

Eighteen percent of firms reported helping employees engage in their health care as the primary reason for offering a Health Savings Account, with small firms (3-199 workers) being less likely (17%) than large firms (200 or more workers) (33%) to report this as their primary reason for doing so.

Health Plan Innovation Take: This report is more evidence that consumer-driven health care in the form of high deductible health plans associated with a tax-favored Health Savings Account has achieved significant acceptance among both large and small employers as a means of controlling the rise in health care costs.

Learn more about Health Savings Accounts at HSA for America.

Posted by Wiley Long at 11:10 AM | Comments (0)

May 18, 2009

More Than Eight Million Now Enrolled in Health Savings Accounts

A new census released by America's Health Insurance Plans (AHIP) finds that Eight million Americans are now covered by Health Savings Accounts, an increase of more than 31 percent since last year. Health Savings Accounts were authorized starting in January 2004. Since then, AHIP has conducted a periodic census of its members participating in Health Savings Accounts.

Another report released found Health Savings Account (HSA) account holders have a broad range of incomes levels across the country. The report, "Estimated Income Characteristics of HSA Account holders in 2008", used a geo-coding technique to estimate the income characteristics of HSA account holders.

"HSA plans provide coverage to a number of consumers of all ages and incomes across the country, and they represent an important choice for employers and individuals when looking at the portfolio of coverage options available," said Karen Ignagni, President and CEO of AHIP.

Key findings from the census include:

* There was an increase of approximately 1.9 million Americans enrolled in an HSA plan since January 2008. Previous AHIP census reports found that 6.1 million were enrolled in January 2008, 4.5 million were enrolled in January 2007, 3.2 million were enrolled in January 2006, and 1.0 million were enrolled in March 2005.

* 30 percent of individuals covered by an HSA plan were in the small group market, 47 percent of individuals covered by an HSA plan were in the large-group market, and the remaining 23 percent were in the individual market.

* A majority of HSA enrollees are covered by Preferred Provider Organization (PPO) products (83 percent) and Health Maintenance Organization (HMO) products (10 percent). In the individual market, almost 92 percent of enrollees in HSA plans were in PPO products, while approximately 85 percent of enrollees in large-group and 76 percent of enrollees in small-group HSA plans were in PPO plans.

* States with the highest levels of Health Savings Account enrollment were California (854,000), Florida (524,000), Illinois (497,000), Texas (476,000), Ohio (464,000), and Minnesota (388,000).

Key findings from the income characteristics analysis include:

* Households with a wide range of incomes hold HSA accounts, with almost half (49 percent) of accountholders living in neighborhoods with median incomes under $50,000 (incomes based on 2000 Census data).

* Average total deposits (including personal deposits, employer contributions, and interest) for all HSA accounts were $1,634 and average total withdrawals (including fees) were $1,063.

For more information about the 2009 census and the income report, please visit www.AHIPResearch.org. For more information about Health Savings Accounts and how to find the best HSA plan for your personal situations, please visit HSA for America.

Posted by Wiley Long at 11:04 AM | Comments (0)

May 13, 2009

Health Savings Accounts Are a Great Way to Save Money on Health Care and Health Insurance

You need to look at your health insurance coverage the same way cost-cutting entrepreneurs do, whether you buy your health care coverage independently or through your employer. Buying coverage in the future won't stop at finding the best price. What you pay for your health insurance coverage will increasingly involve how well you personally manage your health.

According to a report last year by benefits consultant Watson Wyatt, nearly half of the 453 largest U.S. employers currently offer a Health Savings Account that can be used to pay a portion of medical expenses not covered under the companies health insurance plan.

Also, don’t be surprised if your employer or insurer is going to get tougher about you losing weight, quitting smoking or taking part in a monitored exercise plan.

Here are some ideas to help you take the first step in monitoring these costs:

Change your negative healthcare behavior:

Lowering the number on your bathroom scale will not only have immediate health benefits, it will also make your health insurance options and potential out-of-pocket costs more affordable over time. A Stanford University and Rand Corporation study reported that lifetime medical costs related to diabetes, heart disease, high cholesterol, hypertension and stroke among the obese are $10,000 higher than among the non-obese. It added that lifetime medical costs could be reduced by $2,200 to $5,300 following a 10 percent reduction in body weight.

Know what you’re buying:

Whether you buy your Health Savings Account insurance plan through an agent or your employer, insist that they explain exactly what you’re getting for your premium, and where deductibles do and don’t apply. That way, you’ll have a baseline when you buy your own coverage. If you’re purchasing your own HSA insurance policy, compare the premium savings from a higher deductible plan with your usage pattern of health services. What you save can often cover your high deductible.

Always research and discuss the potential cost of a diagnosis:

If your physician diagnoses a condition that requires tests, prescription drugs, a hospital stay or ongoing therapy, ask polite but detailed questions about what you’ll be charged, from the doctor’s bills to ongoing ancillary costs associated with treatment. Ask the doctor or his office manager if discounts can be negotiated through cash payments or other means. You also need to be careful that you’re not being charged a rate for uninsured patients when you are simply going to paying for all or part of the bill to get to your deductible. Last, consider asking doctors for generic options and samples of prescription drugs to extend your savings.

Make sure your exact spending is reducing your deductible:

Keep a binder or a filing system to monitor how this year’s out-of-pocket spending is reducing your Health Savings Account deductible. Your insurer’s total may not always be accurate or up-to-date. Also, make sure you understand which procedures are offered through your HSA plan that will be paid even though you haven’t paid up your deductible.

Check local pricing resources:

In non-emergency situations, you should always compare prices on treatments. Check with local medical boards and state health officials to see if they have online databases on costs for various medical procedures. Also, if there is a support group for your condition, talk to members about what they paid locally for care.

Be smart about emergency and non-emergency health visits:

Emergency-room visits tend to cost $300 to $1,000 compared with $150 at an urgent-care center and $35 to $45 at a convenience-care clinic in a drug store or some other location. First, make sure the alternatives to hospital emergency room care are acceptable for your illness. Write yourself a note at some point to check out these options in your community so you understand what they offer, what their hours of business are, and under what conditions you’d choose them. In particular, make sure the facility and the provider are in your health plan's network so whatever you pay out-of-pocket counts toward your deductible. Also rely on your insurer's 24-hour advice hotline for guidance on where to go for care. Either tape that call or keep a written record of it in case you have a claim denied.

Talk to a financial advisor about planning for long-term care:

If you or a loved one are diagnosed with a chronic illness, that’s a financial issue that requires a plan. As tough as it may be to focus on money issues at a stressful time, make an appointment with a tax professional or a Certified Financial Planner professional to discuss affordability options that will safeguard your assets, including Health Savings Accounts that can backstop out-of-pocket costs on high-deductible policies.

Learn more about Health Savings Accounts at HSA for America

Posted by Wiley Long at 10:53 AM | Comments (0)

May 08, 2009

Health Savings Accounts Frequently Asked Questions

One of the best way to save money on your healthcare costs is to use a Health Savings Account to supplement your current health insurance plan. Your Health Savings Account can also have your money working for you by earning interest, along with saving money on your health care costs. And, you can save your Health Savings Account money tax-free.

If you have a high-deductible health insurance plan and have not yet open a Health Savings Account, you need to learn more about the advantages of Health Savings Accounts. Check out these Top 10 Health Savings Account Frequently Asked Questions to get a jump-start on understanding Health Savings Accounts:

1. How do I start a Health Savings Account (HSA)?

First, you have to have a qualifying health insurance plan. A qualifying health insurance plan is one that carries a high deductible. Each year what is considered a high-deductible health insurance plan changes, but generally it would be a deductible that is not considered in the normal range for a health insurance plan. If you think you have a high-deductible health insurance plan then you can contact your employer, health insurance company, or a number of private insured banks and credit unions locally or online to find out about setting up a HSA. Sometimes employers help contribute to Health Savings Accounts so make sure to see if yours does.

2. What if I switch jobs, do I lose my money?

No. The Health Savings Account is yours. Whatever money you contribute to your HSA you keep, just as you would in a savings account. Even if you don't use all your HSA money in one given year, the money will just roll-over to the next year for use.

3. Do I pay taxes on the money before it is put into my Health Savings Account?

No, the money goes into your HSA account tax-free if your employer will set-up pay check deductions for you. If not, then when you prepare your federal income taxes you will be able to take a deduction for the money you contributed to your HSA that year. When you withdraw your Health Savings Account money to pay for any qualifying expenses, it is withdrawn tax-free.

4. Can I have some examples of HSA qualifying expenses?

Here are some examples of HSA qualifying expenses: prescription medicines and eye glasses, office visit co-pays, chiropractors, dentists, orthodontists, over-the-counter meds such as aspirin and antacids, birth-control (over-the-counter or prescription), and laser eye surgery to name a few. There are many more things that you can use your money for so when you get a HSA plan, you will need to ask for a list of covered expenses.

5. What happens if I lose my health insurance?

Once you have money in your HSA, you can continue to use it even if you do not have a high-deductible health insurance plan anymore, but you cannot keep contributing money to your health savings account.

6. Can I use my HSA money to pay for my health insurance premiums?

You can use your HSA money to pay for your health insurance premiums while you are collecting federal or state unemployment benefits. You can also use your HSA money to pay for COBRA premiums.

7. What if I need medical care in another country... can I use my HSA money there?

Yes, your HSA money can be used for the same medical expenses anywhere and in another country.

8. How much can I contribute to my HSA account?

That changes yearly but as of 2009 a single person could contribute up to $3,000 per year and a family could contribute up to $5,900 per year.

9. Can my HSA money be invested?

Yes. Your health savings account money can be invested similar to a 401K.

10. When I die, do I lose my HSA money?

No. You can name a beneficiary to receive your health savings account money.

Learn more about Health Savings Accounts at HSA for America.

Posted by Wiley Long at 10:36 AM | Comments (0)

May 05, 2009

What Becomes of Your Health Savings Account if You Get Laid Off

The good news for people with Health Savings Accounts is they don't need to panic about their healthcare if they get laid off. The money in your Health Savings Account remains yours even after you lose or leave your job, unlike funds in a flexible spending account. So you don't need to rush to the dentist or eye doctor to drain your Health Savings Account before your job is terminated.

You can keep the money in your current Health Savings Account, or you can roll it over to another HSA administrator without having to pay taxes on the move -- a lot like an IRA rollover. The money can then continue to grow in the Health Savings Account and can be used tax-free for future medical expenses in any year... even if you no longer have a high deductible health insurance policy.

But you must have a high deductible health insurance policy to make new contributions, whether you continue your former employer's plan through COBRA or you purchase your own high deductible policy after you leave your job. A high deductible policy is a good option if you've been laid off because it can help keep your premiums low. If you get another job without a high deductible policy, you won't be eligible to make new contributions to your HSA.

You can make HSA contributions at any time during the year, and you have until April 15, 2010, to make your 2009 HSA contributions (and remove any excess contributions). The money you put into an HSA is tax-deductible and grows tax-free for future medical expenses.

HSA money usually can't be used to pay for health insurance premiums, but there's an exception for people who lose their jobs: You can use the HSA money for health insurance premiums (whether for COBRA coverage or any other health insurance) if you're receiving unemployment compensation. That can be a way to pay your premiums with tax-deductible money.

Learn more about Health Savings Accounts at HSA for America.

Posted by Wiley Long at 08:58 AM | Comments (0)

April 23, 2009

Don't Look Now, Health Savings Accounts Are Gaining Momentum

Many employers are using cash incentives to entice employees toward consumer-driven health plans, such as Health Savings Accounts and Health Reimbursement Arrangements. Employees may pay as much as 50 percent less for premiums than those enrolled in more traditional point-of-service or preferred provider plans.

Health Savings Account plans typically entail a tax-exempt account for paying qualified health expenses, with a high deductible component for coverage in case of a major medical problem. In most cases, both the employer and the employee may contribute to the account, and unused money can be carried over to the next year.

By giving employees a more direct stake in their use of health care, employers benefit, too, with an average 1 to 2 percent smaller cost increases year to year, said Mr. Nussbaum, speaker at yesterday's Pittsburgh Business Group on Health conference on emerging trends in the health benefits arena.

"The best performers are consistently driving their costs lower," he said.

Although companies' health-care cost increases have slowed, from 14.7 percent in 2002 to 6 percent in 2008, they are still twice the inflation rate and an ever-present concern for businesses.

In a 2008 survey of almost 500 companies, Mr. Nussbaum said, nearly 10 percent fewer employers say they're confident they'll be able to offer health benefits for the next 10 years than the previous year, "the first time that's happened in 14 years. And that's a substantial drop."

One major driver in rising health-care costs is prescription drugs. Jack Bruner, CVS/Caremark executive vice president for strategic development and marketing, told the gathering of business executives that one problem is simple patient compliance. Nearly one-third of original prescriptions for chronic conditions never get filled, he said, and 70 percent stop refilling scripts the first year, he said.

The reasons may vary from concerns about the ongoing cost to not understanding how long they're supposed to take the medication.

Mr. Bruner said CVS can help patients through on-site counseling and automated renewals. Taking a medication as prescribed, for as long as prescribed, may prevent more serious -- and more expensive -- health problems later.

While cautioning that "there's no one silver bullet that does everything," Mr. Bruner offered several suggestions that together might save up to 20 percent in pharmaceutical costs. They include accelerating the move to generic drugs, careful monitoring of expensive specialty drugs and early identification of health risks.

One commonly cited rule of thumb is that every percent increase in generic drug use translates into a similar-sized reduction in pharmacy costs.

Posted by Wiley Long at 10:49 AM | Comments (0)

April 21, 2009

Satisfying Your Family's Health Needs With A Health Savings Account

In today's health insurance market, making sure that your family is able to stay healthy partly depends on having a good health insurance program. A Health Savings Account can do just that. With a Health Savings Account, you will have reduced insurance rates because of a higher deductible, a tax deferred savings program, broader coverage, and you stay in control of your Health Savings Account dollars. Here are some of the details of the benefits you will find with Health Savings Accounts:

Reduced Rates

By getting a high deductible HSA health insurance plan, you are able to greatly reduce your monthly premiums. This is an especially good way to go if you are younger and are currently in pretty good health. The deductible amounts are pre-determined by the government, and you are required to have deductible amounts between $1,150 and $5,800 for singles, and between $2,300 and $11,600 for families in 2009.

Savings Are Tax Exempt

One of the great benefits of a Health Savings Account is that you enjoy tax-free income (and interest) on the money you have in your Health Savings Account. You can put into the plan money that comes off the top of your taxes. There are limits, though, and for singles it is up to $3,000, and for families it is $5,950 in 2009. A little extra benefit is that you are able to take off of your taxes any money that is deposited into the account all the way up to April 15th. So, if you are coming up to tax time, and find you need to reduce your taxes some more, you can put it into your Health Savings Account, and find the tax break you need.

Better Coverage

Health Savings Accounts have an extra real nice feature - they cover more. Some things that you may not have been covered for under another type of policy, you may find that you are covered for with your HSA plan. This could actually allow you to get a better coverage for less. Things like dental coverage, therapy, even non-prescription medicines and some alternative treatments may also be covered, and even some mental illness treatments, too.

You Keep Control

Under an HSA, you are the one in control of the money. It is yours to use. You can take money out of the account when you want, but only the money that is used only for medical purposes is tax-exempt. Generally, you will be given a card, like a credit card, that gives you access to the account. Whenever you use money from the account, the insurance company automatically gets a receipt, and it is subtracted from your account, and your deductible - and it remains tax exempt.

Like any other insurance policy, once you have paid the deductible amounts, the rest is up to the insurer to pay. By having the high deductible you reduce the premiums considerably. The savings account can also provide a good hedge for your medical insurance program for the future, too, because any money not used toward the deductible remains your money to use next year, if you need it. On the other hand, the money in your HSA might also be used to provide some money for retirement - assuming you maintain your good health.

Learn more about Health Savings Accounts at HSA for America.

Posted by Wiley Long at 10:05 AM | Comments (0)

April 17, 2009

Health Savings Accounts Are Thriving During Economic Downturn

According to data from San Francisco-based Canopy Financial Inc. individual Health Savings Account balances have increased 33%, and family Health Savings Account balances have increased about 12% between the first quarter and fourth quarters of 2008.

The study also found that employees contributed more money to their Health Savings Accounts more than their employers did. In the fourth quarter, employees contributed an average monthly payment of $206 to their family Health Savings Account, while employers contributed $133. Individual Health Savings Accounts fared similarly; Employees contributed $111 on average, while employers contributed $69.

“What we've seen throughout 2008 is that consumers who select Health Savings Accounts to manage their health care spending are not simply using these accounts to pay for their immediate health care needs,” Vik Kashyap, chief executive of Canopy Financial, said in a statement. “They are also funding their Health Savings Accounts above and beyond their employer contributions and using them as long-term savings and investment vehicles.”

For more information on Health Savings Accounts, visit HSA for America.

Posted by Wiley Long at 10:03 AM | Comments (0)

April 13, 2009

Laid-Off Workers Turning to Health Savings Accounts

Affordable healthcare plans are becoming increasingly important as millions of Americans lose their jobs. Health Savings Accounts have become popular tools to help employees pay for the cost of their healthcare, even when they have to use COBRA plans.

An estimated 2.6 million Americans lost their jobs in 2008 and thousands more are expected to lose their jobs in 2009. With many Americans accustomed to getting their healthcare coverage through their jobs, millions now turn to alternative coverage options so they can continue to have affordable healthcare. One of the most affordable and practical health care coverage options is a Health Savings Account (HSA).

An HSA is a tax-deductible savings account that lets individuals set aside money to cover the cost of their healthcare. Like with an IRA, individuals can invest the funds from their Health Savings Accounts into high interest rate mutual funds, stocks, money markets, and more. The growth on those investments is tax-free and the money can be used to pay for qualifying medical expenses, including dental expenses, mental therapy, physical therapy, alternative treatments (such as acupuncture), transportation and lodging related to medical expenses, and even non-prescription medications.

We're finding an increase in interest for our HSA plans. As Americans are losing their jobs, they are recognizing that they still need to find a way to afford healthcare for themselves and their families. An HSA is a great addition to a high-deductible insurance plan, like a COBRA plan, because it gives individuals a tax deduction when they set aside money for their healthcare. The money grows tax-free in the savings account. Then, if they need the money for something else down the road that is not related to their healthcare, they can still have access to that money.

Moreover, according to a recent survey by Information Strategies, Inc., 50% of individuals on COBRA that also have an HSA policy are using their HSA funds to pay for their high COBRA premiums each month. Only 51 percent of survey respondents said they have actively investigated Health Savings Accounts as an alternative healthcare benefit. We are hoping that more laid-off workers take a look at HSA plans as a way to cut their health insurance costs. Health Savings Accounts not only benefit individuals, but they can also be used to cover healthcare costs for an entire family.

Posted by Wiley Long at 10:49 AM | Comments (0)

April 09, 2009

Companies Moving From Health Insurance To Health Savings Accounts

One of the largest issues facing the nation right now is the rising costs of health insurance. Many people can not afford to buy health insurance, because the premiums have been driven up to unimaginable heights over the last decade or so. Many companies are trying to help shoulder the burden of the large premiums by paying a certain percentage of the total cost every month for the employee. Many of these companies have tried to work around this problem in many ways. Health Savings Accounts are turning out to be one of the better solutions to this problem.

Larger companies have tried to dodge the growing health insurance premiums by changing the requirements for employees to receive benefits. Many companies are making it harder for people to receive these benefits. Some companies are requiring the employee to work more hours per week than they used to have to work to receive benefits. Other companies are requiring that an employee work for the company for a longer period of time, before they are eligible for benefits.

Both of these approaches will save the company on health insurance costs, because they will not have to cover as many employees. However this is not the best approach for employees, because it makes it that much harder for them to obtain health insurance. Many other companies are trying to lower health insurance costs a different way.

Some companies are offering inexpensive health insurance, and then supplemented it Health Savings Accounts. The health insurance has very low premiums, but the deductible, and payouts for the health insurance were not very good. However the company would set their own deductibles, and co-pays, and then they would take money out of their Health Savings Account to reimburse the employee the difference. This is a very good system, because companies are not paying as much money out each month on premiums. They would only have to spend money from the Health Savings Account when the employee actually needed it. The goal is to cut out the health insurance plan completely when the Health Savings Account had grown large enough. At that time, the company would then save a considerable amount of money in premiums every month.

Posted by Wiley Long at 11:04 AM | Comments (0)

March 29, 2009

Why Health Savings Accounts Are Catching On

Tracey Jihad has five kids and a chronic illness, reason enough to worry about rising health care costs. So she was apprehensive when her employer announced that it was starting the transition to a new kind of high-deductible health insurance with Health Savings Accounts.

Four years later, Jihad is sold on the way the new coverage lets her control health-care decisions, and hold down costs for herself, her coworkers and her employer. "Especially with the economy, this shows that we can be proactive about reducing health care costs," said Jihad.

Tracey Jihad is a medical records data coordinator for LifeSource, a St. Paul-based nonprofit that coordinates organ donations in the Upper Midwest. What sold her on the new Health Savings Account coverage was the careful way that LifeSource helped employees through the transition. The organization didn't just shift medical costs to them, it showed how they could all save money. It didn't just dump medical decisions in their laps, it taught them how to make smart choices.

The rapid growth of high-deductible health plans has thrown a spotlight on the way employers make what can be a tricky transition. HSA plans require people to pay a larger share of medical costs out of pocket, but let them set aside pretax money in their Health Savings Accounts to cover some of the costs.

Advocates hope HSA plans will help rein in health care costs by encouraging consumers to use medical services more prudently. But many experts worry that consumers will scrimp on needed care or valuable preventive services, saving money now but driving up health costs in the long run.

Learn more about Health Savings Accounts at HSA for America.

Posted by Wiley Long at 04:03 PM | Comments (0)

March 26, 2009

Report Finds Participation in Health Savings Account Plans Encouraging

According to a new report by the Manhattan Institute, Health Savings Accounts tied to HSA-qualified health insurance plans with high deductibles have gained participants at a higher rate than individual retirement accounts (IRAs) did in their early years. Moreover, data studied by the report's author suggest that health coverage under plans tied to Health Savings Accounts "has the potential to expand at least as sharply over time as IRAs and defined-contribution retirement plans did."

The report said that HSA-qualified high-deductible health insurance plans are now used by more than 6 million U.S. residents.

HSA Account holders and employers are allowed to contribute untaxed funds to their Health Savings Accounts under the Medicare Modernization Act of 2003 as long as the insured individual is not covered by other health insurance or eligible to be claimed as a dependent on someone else’s tax return. Distributions from the account used to pay for “HSA qualified medical expenses,” including over-the-counter drugs, are tax-free.

These accounts are designed to be more attractive as a savings mechanism than medical spending accounts or health care reimbursement accounts set up under previous laws. Contributions to Health Savings Accounts not expended by the end of the year can be rolled over indefinitely, and they can be used to pay for any qualified medical expenses incurred after the account was established. In addition, they have the potential to provide more tax savings than IRAs or 401(k)s, for which either contributions are made with pre-tax dollars (in traditional accounts) or withdrawals are made tax-free (from Roth accounts) — but not both.

The Manhattan Institute study’s author, Senior Fellow Benjamin Zycher, compared the rate of adoption for Health Savings Accounts in their first four years with early participation in IRAs and other defined-contribution retirement plans. While acknowledging that the data available on early participation in IRAs as a percentage of all pension plans are difficult to interpret and don’t match the data on participation in Health Savings Accounts as a percentage of all health insurance, Zycher found that the percentage of people covered by private insurance who were enrolled in HSA-qualified plans in their early years closely corresponds to the percentage of total retirement assets found in IRAs in their beginning years. “The data on the whole suggest that HSA-qualified health coverage has the potential to expand at least as sharply over time as IRAs and defined-contribution retirement plans did, assuming conducive legal and regulatory developments,” he wrote.

The report noted that relatively few consumers are “extremely” or “very” familiar with Health Savings Accounts, suggesting there is “room for improvement” in adoption of these plans. On the positive side, the study found that premiums for HSA Insurance are 10 percent to 40 percent lower than those for other types of plans, and that a wide range of preventative services are available to policyholders on a “first-dollar” basis, without having to meet the plans’ high deductibles. Moreover, it said, “less than half the funds in HSA accounts in 2007 were expended on health care, demonstrating these accounts’ viability as savings vehicles.”

Zycher noted that Congress’s purpose in authorizing tax-free accumulation and withdrawal of funds in Health Savings Accounts to pay for medical care was to encourage more people to become “consumers” of health care services so they would be more cost-conscious and help bring the overall costs of medical care down over time.

To accomplish that goal, participation in High Deductible Health Plans (HDHPs) must grow at a meaningful rate, and he suggested several policy changes that would likely improve the plans and make them more appealing to consumers. For example, he suggested making employers’ contributions to Health Savings Accounts exempt from payroll taxes and allowing individuals to deduct the premiums for their HDHPs from their taxable income. In addition, he recommended lowering the deductibles for hospital and chronic care, since these are not generally discretionary expenditures and subjecting them to the high deductibles is unlikely to discourage excessive consumption of these services.

Also important, according to Zycher, is making the plans easier for people to understand. “This country’s experience with retirement plans suggests that greater legal and regulatory simplicity combined with looser eligibility standards and more generous limits on the contributions” could make the plans more popular, he wrote.

Learn more about Health Savings Accounts at HSA for America.

Posted by Wiley Long at 10:54 AM | Comments (0)

March 09, 2009

Data Shows Gaining Popularity of Health Savings Accounts

The Center for Medical Progress at the Manhattan Institute has released a new report that finds Health Savings Accounts and HSA-qualified health insurance coverage have the potential to reduce health care costs and have expanded in popularity over time. In "HSA Health-Insurance Plans After Four Years: What Have We Learned?" Manhattan Institute senior fellow Benjamin Zycher lays out recommendations to simplify regulation of Health Savings Accounts and to strengthen financial incentives to participate in Health Savings Accounts.

The goal of Health Savings Accounts is to provide consumers with more control over their healthcare spending and give individuals increased incentives to economize on their consumption of health-care resources. Although the data are still early, Zycher argues that Congress should continue to support and improve HSA- eligible insurance plans as a valuable healthcare reform tool.

The findings of this report indicate that Health Savings Accounts have potential to cut costs while maintaining quality care:

- Premiums for HSA insurance plans are significantly lower than those for other types of plans, by about 10 percent to 40 percent

- Participation in HSA/high-deductible health coverage, as a proportion of all health coverage, has grown slightly faster than the proportion of total retirement assets that IRA assets alone represented in the early years of IRA eligibility

- 6.1 million people have chosen to be covered by HSA and other high-deductible plans as of 2008

- Deductibles for HSA plans recently have risen much more slowly than the deductibles for the other types of health coverage plans

- A wide range of preventive-care services count toward plan deductibles (or are covered on a "first-dollar" basis) under most HSA-qualified policies

Policy Recommendations:

Tax policy:

- Payroll taxes now imposed on amounts employees direct to their Health Savings Accounts should be lifted

- Insurance premiums for HSA-qualified insurance purchased in the non-group market should be made deductible from income taxes

- Funds in an HSA account should be allowed to cover all "HSA qualified medical expenses," as the tax code defines them, so long as they have been incurred after HSA-qualified coverage begins

- Sums paid by patients to their primary-care physicians for the right to receive medical services on an as needed basis should be deemed qualified medical expenses

Insurance policy:

- Policyholders should be permitted to pay insurance premiums with funds deposited in Health Savings Accounts

- The maximum contribution that an HSA participant is allowed to place in his HSA account should be raised to match the limit on out-of-pocket expenditures, so that he does not have to pay out more than he has put in

- Spouses aged 55 and over should be allowed to make extra contributions to a single health savings account up to the maximum allowable for a couple, instead of being required to establish a second account

- High deductibles for hospital and chronic care should be lowered, since they are unlikely to discourage excessive consumption of health-care services, because of the non-discretionary nature of treatment for acute or chronic conditions

Legislative:

- Congress should allow participants, after turning 65, to continue to contribute to their Health Savings Accounts, even if they have become Medicare beneficiaries

- Simplification of HSA-qualified insurance would enable clear comparisons with other types of plans, help familiarize consumers with its features (with the assistance of insurers and employers)

Health care costs are continually rising and policymakers are looking to reform our health care system. The early data on Health Savings Accounts suggests that use of these health insurance policies may achieve lower costs and greater savings for health care consumers. Reforms of the tax policy and insurance regulations should be put in place so consumers can more easily understand how Health Savings Accounts function, allowing them to have greater control over their healthcare choices.

Visit HSA for America for more information on Health Savings Accounts and HSA insurance instant quotes.

Posted by Wiley Long at 09:17 AM | Comments (0)

March 05, 2009

Free Guide to Health Savings Accounts Explains Benefits

Health Savings Accounts are the most powerful weapon for individuals and small to medium-sized employers to slice healthcare costs without reducing coverage... and they don't need to be confusing.

The Consumer's Guide to Health Savings Accounts report clears up HSA mysteries with step-by-step instructions on how an HSA can be used creatively and effectively. The guide provides a case study with before-and-after costs, a comparison of benefits and costs, how to find the best plans, how to decide on an HSA Administrator, and pitfalls to avoid.

An HSA consists of the Health Savings Account itself, which lets employees and/or employers set aside tax-free savings to pay out-of-pocket medical expenses, and an associated qualified high-deductible healthcare plan.

Most US employers could be reaping big advantages from an HSA, but only about 6 percent do. Individuals are also starting to see the huge benefits of these plans, but many are still confused. Our report will help clarify any questions you still may have.

"The Consumer's Guide to Health Savings Accounts" is available free for download at HSA for America.

Posted by Wiley Long at 10:38 AM | Comments (0)

March 01, 2009

Learn How Health Savings Accounts Work

Jenny Thomas checked into her local hospital to deliver her first child. Unanticipated complications necessitated an emergency surgery. Fortunately both she and the baby were fine. But if it hadn’t been for her family’s Health Savings Account (HSA), she could have ended up owing the hospital tens of thousands of dollars.

An HSA is smart savings plan that you use for unanticipated medical expenses. Usually, money that is saved in the plan comes out of your paycheck before payroll taxes are computed, so you maximize your savings rate.

Furthermore, any income that the HSA plan itself generates (such as from interest or investment appreciation) is also tax free, so it grows fast. Some employers even contribute extra matching cash to the plan to encourage you to save.

In most parts of the country, to be eligible for an HSA you also need to hold a High-Deductible Health Plan (HDHP). An HDHP is a plan where the deductible – that is the amount that you pay out of pocket, before the insurance "kicks in" is somewhat higher that what you might have seen before: usually in the neighborhood of $2,000 to $3,000. The big idea behind the HSA/HDHP combo is that the premiums on the high-deductible plan are so much lower that even though you pay the first couple of thousand "out-of-pocket" – actually out of your HSA – you save money in the long run over a traditional plan.

Hundreds of banks, credit unions and insurance companies offer Health Savings Accounts, and it’s easy to sign up. Once you’re enrolled, you can use the money in the account for almost any approved medical, dental, vision or disability health care or expense.

Health Savings Accounts differ from one another mostly in the ways they grow. Some Health Savings Accounts grow like traditional savings accounts, with interest compounding daily. Other Health Savings Accounts let you be more aggressive and pick money market funds, mutual funds or other investment vehicles so that you can maximize the growth of the account. It’s up to you, and you should make sure you understand the investment choices available to you before you select your HSA institution.

After you have opened an HSA, managing the account is pretty easy. You set up automatic deductions from your paycheck, usually totaling an annual amount less than your HDHP deductible. You then invest your accumulating HSA funds in interest-bearing accounts, stocks, bonds and/or mutual funds, depending on the choices available to you at your HSA institution. Returns on these investments are tax-free, so they compound fast! If, in some year, you don’t use the cash, it automatically gets carried over to the next year. So in this way Health Savings Accounts are different from "Flexible Spending Accounts" which typically follow a "use it or lose it" approach.

Learn more about Health Savings Accounts at HSA for America.

Posted by Wiley Long at 11:03 AM | Comments (0)

February 23, 2009

Consumers Turn to Low Cost Health Savings Accounts to Save Money

Millions of consumers are switching to high-deductible health insurance plans that work with Health Savings Accounts as a way to reduce the cost of their health insurance. In addition to reducing health insurance premiums, Health Savings Accounts can also help to lower taxes and provide a means for individuals to grow their savings even more.

As the economy becomes increasingly unstable, consumers are looking for ways to save money wherever possible - especially on the high cost of health care and health insurance plans. A large number of consumers are switching to high-deductible Health Savings Account (HSA) plans from low-deductible, higher rate health insurance plans.

When individuals and families enroll in high-deductible HSA-qualified plans, their health insurance premiums can be reduced by as much as 40 percent off of the cost of conventional co-pay health insurance plans. The switch to an HSA plan may save members thousands of dollars each year off of their healthcare costs. Plus, HSA plans also help to reduce the amount of taxes people have to pay each year.

We're finding that has been is a huge surge over the past three to four months in the amount of inquiries and enrollees into our HSA programs. Our clients are looking for ways to continue to receive high quality healthcare while also saving as much of their money as possible. The HSA option is viable for just about every one of our clients and can help to ensure that they are able to save money and still get a high level of health care.

Also, when people enroll in an HSA plan, they can roll their premium savings into tax-deferred investments that work similarly to IRAs. HSA plan members can set aside money in small increments that can be used for current or future healthcare costs. Just like any investment, they can continue to contribute to their Health Savings Accounts for life so that they will have available funds when they need them, even if they don't need them now. Contributions to the HSA are tax-deductible, and the money growth is never taxed if it is used for an HSA qualified medical-related expense.

At HSA for America, we offers a variety of HSA plans for individuals, families, and small businesses. For more information about plans from HSA for America, visit: http://www.health--savings--accounts.com

Posted by Wiley Long at 10:25 AM | Comments (0)

February 20, 2009

Early Data Suggests Health Savings Accounts Are Gaining Popularity And May Cut Healthcare Costs

A new report finds that Health Savings Accounts have the potential to reduce health care costs and have expanded in popularity over time. In the report titled "HSA Health-Insurance Plans After Four Years: What Have We Learned?" released by the Center for Medical Progress at the Manhattan Institute, senior fellow Benjamin Zycher lays out recommendations to simplify regulation of Health Savings Accounts and to strengthen financial incentives to participate in Health Savings Accounts.

The goal of Health Savings Accounts is to provide consumers with more control over their healthcare spending and give individuals increased incentives to economize on their consumption of health-care resources. Although the data is still early, Zycher argues that Congress should continue to support and improve HSA-qualified health insurance plans as a valuable healthcare reform tool.

The findings of the report indicate that Health Savings Accounts have potential to cut costs while maintaining quality care:

- Premiums for HSA qualified policies are significantly lower than those for other types of plans, by about 10 percent to 40 percent

- Participation in HSA/high-deductible health coverage, as a proportion of all health coverage, has grown slightly faster than the proportion of total retirement assets that IRA assets alone represented in the early years of IRA eligibility

- 6.1 million people have chosen to be covered by HSA and other high-deductible plans as of 2008

- Deductibles for HSA-qualified plans recently have risen much more slowly than the deductibles for the other types of health coverage plans

- A wide range of preventive-care services count toward plan deductibles (or are covered on a "first-dollar" basis) under most HSA-qualified policies

Policy Recommendations:

Tax policy:

- Payroll taxes now imposed on amounts employees direct to their Health Savings Accounts should be lifted

- Insurance premiums for HSA-qualified health insurance purchased in the non-group market should be made deductible from income taxes

- Funds in an HSA account should be allowed to cover all "qualified medical expenses," as the tax code defines them, so long as they have been incurred after HSA-qualified coverage begins

- Sums paid by patients to their primary-care physicians for the right to receive medical services on an as needed basis should be deemed qualified medical expenses

Insurance policy:

- Policyholders should be permitted to pay insurance premiums with funds deposited in Health Savings Accounts

- The maximum contribution that an HSA participant is allowed to place in his HSA account should be raised to match the limit on out-of-pocket expenditures, so that he does not have to pay out more than he has put in

- Spouses aged 55 and over should be allowed to make extra contributions to a single health savings account up to the maximum allowable for a couple, instead of being required to establish a second account

- High deductibles for hospital and chronic care should be lowered, since they are unlikely to discourage excessive consumption of health-care services, because of the non-discretionary nature of treatment for acute or chronic conditions

Legislative:

- Congress should allow participants, after turning 65, to continue to contribute to their Health Savings Accounts, even if they have become Medicare beneficiaries

- Simplification of HSA-qualified insurance would enable clear comparisons with other types of plans, help familiarize consumers with its features (with the assistance of insurers and employers)

Health care costs are continually rising and policymakers are looking to reform our health care system. The early data on Health Savings Accounts suggests that use of these health insurance policies may achieve lower costs and greater savings for health care consumers. Reforms of the tax policy and insurance regulations should be put in place so consumers can more easily understand how Health Savings Accounts function, allowing them to have greater control over their healthcare choices.

The Manhattan Institute, a 501 (c)(3), is a think tank whose mission is to develop and disseminate new ideas that foster greater economic choice and individual responsibility.

Posted by Wiley Long at 09:45 AM | Comments (0)

February 11, 2009

A Basic Overview of Health Savings Accounts

Health Savings Accounts are becoming more of a need these days
than a luxury. You must be enrolled in a high deductible health insurance plan in order to qualify for a Health Savings Account (HSA). Since Health Savings Accounts have been around, millions of people have qualified and gotten one. The trend should only continue to raise as more and more employers and companies offer this benefit as a bonus to their medical plans. Some companies aren't quite there yet but many have jumped on the bandwagon. There are some basic rules that can help an individual or corporation decide to enter the HSA market:

To establish an HSA, there are some rules and regulations. It is like establishing an individual retirement account (IRA) in most cases. In fact the documents are very similar and the procedure as well. An HSA trustee (or HSA Administrator) can add terms to their agreement regarding the effecting policy and procedure of their HSA. These terms can include any of the following but that may not be all that is required. Included in your agreement could be definitions, fees and expenses, amendments, disqualifying provisions, investment options, distributions, transfers and rollovers, reports and records, termination and/or resignation, and liability protection. There might be more of less of these conditions depending on the insurer.

HSA eligibility requires you to have an Internal Revenue Code to even desire to be eligible. You must be enrolled in a high-deductible medical care plan. So, people who don’t pay a deductible or it is very low, do not qualify for this benefit. Some exemptions do apply of course but you would need to contact the right person to find out. You must not be able to be claimed as a dependent for anyone else or on Medicare. To qualify your deductible needs to be for an individual a minimum or $1150, and your out of pocket expenses can’t exceed $5,800 for that year. For a family, the deductible needs to be a minimum of $2300 and the out of pocket portion can’t exceed $11,600 per year. There is a cost of living deduction as well and your agent to better save you money will adjust things. Many organizations require that you prove you are eligible prior to a contract. It is the individual asking for the HSA that must figure out that they qualify or might qualify.

The yearly contribution can’t exceed the deductible amount or combination with out of pocket expenses. As long as the individual has the high-deductible health plan they are qualifying. If you lose this plan, you will not be eligible for that month or period of time. If you are married and have separate high-deductible health plan, it is the lowest deductible amount that the family as a whole can meet. There are no combining deductibles to get a higher benefit. If you qualify, you can establish a regular contribution, a rollover contribution, or a transfer contribution plan. For the money to be deductible for a specific tax year, one must file by the deadline to receive the benefits. If an eligible individual’s employer contributes to his or her HSA, the employer, not the HSA owner, is entitled to a deduction.

An HSA administrator or trustee reports the contributions on IRS Form 5498-SA, HSA, Archer MSA, or Medicare Choice MSA Information. Copies of the report are due to each participant and the IRS by May 31 of each year. The owner is responsible for reporting the contribution amount on the proper forms to be submitted and file them with the income taxes that year. The distributions are to be made by the owner, if different than the participant. These will tax-free if used to pay for, or reimburse qualifying medical expenses that occurred after putting the plan into effect. These expenses include and could exceed the diagnosis, cure, treatment, or prevention of disease, prescription and certain nonprescription drugs, and transportation and certain lodging costs primarily for and essential to qualified medical care and certain qualified long-term care services. It is an HSA owner’s responsibility to determine the taxability of an HSA distribution and whether it is legitimate. The guidance of a tax or legal professional may be necessary to determine whether an expense is a qualified medical expense to avoid penalties.

To learn more about Health Savings Accounts, visit: http://www.health--savings--accounts.com

Posted by Wiley Long at 11:36 AM | Comments (0)

February 02, 2009

Health Savings Account 2009 Information

Guest writer Bill Randell explains his experience with Health Savings Accounts and what you need to know about them heading into 2009:

This year we switched to a high-deductible health plan that enabled us to open a Health Savings Account (HSA). For 2008, the IRS has the following requirement for HSA-eligible high-deductible health plans:

Single/Self-Only HSA Coverage -
* Minimum Annual Deductible: $1,100 ($1,150 for 2009)
* Maximum Out-of-Pocket Expenses: $5,600 ($5,800 for 2009)

Family HSA Coverage -
* Minimum Annual Deductible: $2,200 ($2,300 for 2009)
* Maximum Out-of-Pocket Expenses: $11,200 ($11,600 for 2009)

On May 1 of last year we had narrowed our choices down to two HSA plans. The first option was to keep the same plan at a cost of $928.49 per month for our family plan with a $25 office visit, $100 emergency, $75 for MRI/CAT/PET scans, $1,000 hospitalization, $250 day surgery and 15/30/50 for prescriptions. The other option was to switch to a $3,000 family deductible plan, before any co-payments for office visits and prescriptions would apply, while hospitalizations and day surgeries would be covered 100 percent after we paid the $3,000 family deductible. We chose the later HSA insurance plan with a monthly premium of $854.78 per month.

Although we saved $73.71 per month in premiums and had no planned medical procedures, it was not the reason we went with this plan. We picked a $3,000 family deductible plan to open an HSA, which then allows us to contribute up to $5,800 tax deductible and tax-deferred (individuals can contribute up to $2,900). In the event we do incur any medical expenses through the deductible, we can withdraw money from the Health Savings Account without any tax consequences.

On the other hand if we do not incur any unreimbursed medical expenses, we do not lose the money in our HSA. Money that remains in the HSA is allowed to accumulate tax-deferred and can be withdrawn at any time, but would be taxable just like an IRA, including a 10 percent penalty before age 59.5. In addition, an HSA-eligible participant has until April 15, 2009 to make their contribution.

After eight months, we have:

1. Saved $589.68 in premiums
2. Incurred no claims towards the deductible
3. Contributed $5,800 tax deductible into our HSA

Health Savings Accounts are not for everyone, but it's an option that should not be overlooked. The HSA can be a great way to supplement other retirement plans that may be maxed out, or retirement plans that limit your contributions by those of the rank-and-file.

Lastly keep in mind that most health carriers will allow a company to offer multiple plans. One plan could be a conventional plan, not HSA-eligible. The other could be a high-deductible plan that is HSA eligible.

If you're at all interested at saving money on your health insurance, I recommend you learn more about Health Savings Accounts at HSA for America.

Posted by Wiley Long at 08:05 AM | Comments (0)

January 29, 2009

Older Individuals are Finding Health Savings Accounts Useful

Health Savings Accounts are an amazing tool that a lot of people have been talking about. They is meant to help you save money on insurance and make your life simpler, maybe even help you be healthier.

But do Health Savings Accounts work just as well for older Americans? The answer depends on your age.

Let’s start with someone older than 65. Once you turn 65, you are eligible for Medicare, and that means you can no longer contribute to a Health Savings Account (HSA). If you had an HSA before you turned 65, a very interesting thing happens.

The HSA, which was basically an account that could only be used for medical expenses, suddenly becomes an Individual Retirement Account (IRA). It instantly changes status when you turn 65.

This is a very intriguing concept for all of us who are younger than 65. You already know that there is no “use it or lose it” condition for an HSA. You keep accumulating that money forever, you do not lose it at the end of each year.

So, if you’re not sick very often, you may accumulate a lot of money in your HSA. Then, once you turn 65, you can start pulling money out of it each year as income. Your withdrawals are taxable, but won’t it be nice to have another stream of income when you retire. Think of it as your “Healthy Life Reward Account.” The healthier you are in your life, the more money you’ll have left in your HSA. It could be tens of thousands of dollars!

If you are over 55 but younger than 65, you get even more benefits from Health Savings Accounts. You are eligible for something called “catch up contributions.” This means that you can put more money into your HSA than those of us under 55.

The catch-up contribution is $1,000 in 2009 and forward. If I were you, I’d take good advantage of this catch-up contribution. Tax-deferrals are always nice to have when tax time comes around.

You can read our Consumer's Guide to Health Savings Accounts for extensive information on the best ways to use your HSA.

Posted by Wiley Long at 11:11 AM | Comments (0)

January 26, 2009

Health Savings Accounts Are Creating Better Healthcare and Safer Investing

The security of Health Savings Accounts is more attractive than ever, but there’s a unique bonus inherent in the structure of Health Savings Accounts – the ability to invest your Health Savings Account funds in a safe haven, and build a bigger healthcare nest-egg for the future.

That is a main reason we believe agencies will be far more successful recommending Health Savings Accounts to their clients than they were last year, as long as they understand the appeal and advantages of the investment side of the equation.

Health Savings Accounts came about as part of the Medicare Reform Act of 2003, and they offer consumers a tax-free option for healthcare. With Health Savings Accounts, consumers typically employ a high-deductible health insurance policy to protect against major medical expenses, while establishing a savings account to use for small, day to day medical expenses. What makes it affordable is that the high deductible policy is significantly less expensive than traditional HMOs, and the money they deposit into their Health Savings Account (HSA) is PRE-TAX dollars.

The law allows people to take money out of their paycheck and deposit it directly into their HSA before they pay taxes on it. So, not only do they save on their insurance premiums, but they are also able to save on their taxes. Moreover, HSA money can be used to pay for ANY medical expense, from over-the-counter headache medications, knee braces or orthopedic shoes. Anything remotely medical can be paid for out of that account, all funded with pre-tax dollars. Finally, at the end of the year, any money left over in the HSA account can be rolled over – tax-deferred – to use the next year. Flex spending accounts don’t allow that – if you don’t use it during the calendar year, you lose it.

HSA plans were created in response to the rising cost of health care with the intent to give the consumer back the control of their health care costs and in many cases reduce premiums by up to 50 percent.

These unique plans provide consumers greater control, more choices, tax advantages and are generally more affordable than their HMO and PPO second cousins. Plus, the interest in investing their HSA funds is growing.

According to a survey done by Cigna last year, more than 65 percent of HSA customers said they would be interested in putting their excess HSA funds into mutual funds and other types of investment vehicles that are traditionally safe havens for their money. When you consider that HSA funds come from pre-tax contributions, it’s like double-dipping. Not only do they save on their taxes, but they are also able to grow that amount through the investment options now available for them.

Based on the current economic conditions on Wall Street, nothing in the marketplace can match the benefits of Health Savings Accounts. People are afraid to put their money in stocks anymore and they are looking for vehicles with tax shelters with attractive tax benefits. With Health Savings Accounts, customers can solve both problems: where to safely put your money and how to provide incredible health coverage for your family. Health Savings Accounts are a good alternative to kill two birds with one stone, provide affordable health care and tax benefits in an uncertain and shaky economy.

Posted by Wiley Long at 12:08 PM | Comments (0)

January 23, 2009

California Sees Health Savings Account Growth

The deepening recession is doing something for Health Savings Accounts (HSAs)and other high-deductible health plans in California that a decade of hype could not: It’s making employers sign up.

Kaiser Permanente, for instance, expects to reach 1 million members in its deductible plan offerings by mid-year, according to Dr. Artie Southam, Kaiser’s executive vice president of health plan operations. That would represent 12 percent of total enrollment for an organization that for decades had been wedded to the traditional HMO model.

In Northern California, the Health Savings Account growth spurt will likely translate into between 400,000 and half a million high deductible health plan enrollees, Southam told the San Francisco Business Times, or roughly 40 percent of Kaiser’s national deductible plan total.

Between 15 percent and 20 percent of Kaiser’s deductible plan enrollees are enrolled in HSA-qualified, high-deductible plans, he said.

Posted by Wiley Long at 12:38 PM | Comments (1)

January 15, 2009

New Online Tool Helps Health Savings Account Owners Price Shop

While most Americans can't control the economy, they can do a much better job of educating themselves about what they should pay for healthcare. Healthcarebluebook.com is the first national effort to provide free pricing data to Health Savings Account owners. It is designed to give people the information they need to pay fair prices for their healthcare.

Price variations for healthcare services, even within the same market and provider network, may be thousands of dollars. So knowing what the fair price is can help Health Savings Account owners better manage the cost of their healthcare.

Healthcarebluebook.com is easy to use. Type in the kind of healthcare service you need plus a zip code and the Healthcare Blue Book pulls up the fair price based on fees paid by Preferred Provider Organizations (PPO) to doctors for services in that market. Health Savings Account owners can then use the suggested Healthcare Blue Book price to discuss prices for services and treatments with their doctors and other healthcare providers.

Healthcarebluebook.com also offers a customized application to employers that supports implementation of Consumer Directed Health Plans (CDHP), High Deductible Health Plans (HDHP), and Health Savings Accounts (HSA) among other consumer benefits designs. Applications are built depending upon the types of healthcare services employees use, and what in and out of network PPO and other healthcare providers charge for these services.

Healthcare costs are expected to continue climbing throughout 2009. The National Survey of Employer-Sponsored Health Plans conducted by Mercer, reported that in 2008, PPO deductibles doubled at many companies from $500 to $1,000.

Americans do price/value comparisons for their homes, cars, vacations and the majority of goods and services they buy. "Why not healthcare?" asks Dr. Jeff Rice, Healthcarebluebook.com founder. The former CEO of CareSteps, Rice has a long history in the healthcare industry of developing innovative products for consumers.

"Patients should not assume that a high price means good quality," says Rice. "It is up to patients to ask about the cost of services and to learn about the quality of their providers. Doctors and hospitals that charge a fair price, often provide the best value. Healthcarebluebook.com can help consumers figure out what they should pay."

Health Savings Account owners need better education about the healthcare services they purchase and 2009 is a good year for them to start. Using Healthcarebluebook.com can help people learn how to obtain fair prices for their healthcare.

Posted by Wiley Long at 10:47 AM | Comments (0)

December 23, 2008

Increasing Number of California Employers Offering Health Savings Accounts

The dominance of managed care in the California market led many benefits experts to doubt if Health Savings Accounts would gain much traction there.

But a recent survey by the California HealthCare Foundation has found that 38% of employers in California now offer Health Savings Account plans to their employees, up from 18% in 2007.

However, only 10% of employers offering High Deductible Health Plans to their employees also offer a Health Savings Account (HSA), while less than 1% offer a Health Reimbursement Arrangement (HRA), according to the latest edition of the California Employer Health Benefits Survey, a joint project of the Oakland, Calif.-based California Healthcare Foundation and the National Opinion Research Center.

And even through the percentage of employers offering High Deductible Health Plans in California surged, the number of employees enrolling in the plans remained unchanged from 2007 at 4%. By contrast, enrollment nationally in HSA plans doubled from last year to this year to 8%.

More than three-quarters of California workers were given a health maintenance organization option in 2008, according to the survey, compared with just 41% of workers nationally. As such, California workers have been consistently more likely to enroll in HMOs than covered workers nationally, who are more likely to enroll in preferred provider organization plans, the survey noted.

In California, 52% of covered workers were enrolled in HMOs in 2008, while 33% were enrolled in PPOs, 11% in point-of-service plans and 4% in HSAs. By comparison, 20% of U.S. workers are enrolled in HMOs, while 58% are enrolled in PPOs, 12% in POS plans and 8% in HSAs.

Among other findings of the survey:

* Employer-based health care premiums rose by an average of 8.3% in 2008, the same as 2007.

* More than half of California employers offered coverage for same-sex domestic partners, more than double the national average. Due to a change in survey wording, the 2008 results could not be compared to prior years.

* Thirty percent of covered workers in California were enrolled in a partly or completely self-insured plan in 2008, compared with 55% nationally. The gap between the state and national figures is associated with California’s high HMO enrollment since HMOs are less likely than other plans to be self-insured, the survey noted.

This year's survey, which was conducted by interview from April to July, included 796 randomly selected participants drawn from the Dun & Bradstreet list of private employers with three or more workers.

For complete results of the survey, visit: www.chcf.org

Posted by Wiley Long at 10:50 AM | Comments (0)

December 14, 2008

Doctors Still Need To Learn About Health Savings Accounts

A new survey has found that few doctors are adequately prepared to help patients navigate newer, so-called "consumer-directed" health plans.

The plans, which are meant to shift more responsibility for health care decisions to the individual patient, often come with high deductibles and include a Health Savings Account.

But 43 percent of doctors said they have heard little, if anything, about Health Savings Accounts, and less than half (48 percent) feel ready to discuss medical budgeting with their patients.

"I think as Health Savings Accounts roll out, it's really important to educate doctors about them and about some of the differences between HSA plans and more traditional models of insurance," said study co-author Dr. Craig Pollack, a Robert Wood Johnson Foundation clinical scholar at the University of Pennsylvania in Philadelphia.

The study highlights doctors' nebulous role in counseling patients on financial matters.

"I don't think it's at all clear in insurers' minds what role they want doctors to play, and I don't think physicians themselves are clear on what they're comfortable with," said Dr. Hoangmai H. Pham, a senior health researcher at the Center for Studying Health System Change in Washington, D.C..

Nor do patients know what role they want their doctors to play, she added. "It's frankly very uncomfortable for both patients and physicians to talk about money in any clinical context."

Peter V. Lee, executive director for national health policy at the Pacific Business Group on Health and co-chair of the Consumer-Purchaser Disclosure Project, said the study raises issues that go well beyond consumer-directed health plans.

"Patients under virtually every plan are seeing huge financial implications of their choices," he said, "and historically doctors have felt they didn't need to talk money."

An estimated 5.5 million Americans are enrolled in HSA plans, according to the 2008 Employer Benefits Survey, an annual report released last month by the Kaiser Family Foundation and the Health Research & Educational Trust.

Health Savings Account Plans have grown in recent years as employers have sought ways to shift more responsibility for medical decision-making to employees and their families. The theory is that enrollees will forgo unnecessary services and shop for needed care based on price and quality.

But Health Savings Accounts are not like the managed care arrangements that have dominated the insurance landscape in recent years.

With the exception of some preventive-care services, coverage typically begins after the member satisfies a high deductible -- upwards of $1,500 -- on average, for an individual, according to the Kaiser survey. The high-deductible health insurance plan is paired with either a Health Savings Account or a Health Reimbursement Arrangement, and funds in these accounts can be used to pay for routine medical expenses.

To assess physicians' readiness to engage patients on cost and quality issues in these plans, Pollack and colleagues conducted a random, national survey of 1,500 primary-care physicians and received 528 responses.

About one-third of the doctors surveyed had little knowledge about how money is contributed (35 percent) and spent (31 percent) from the plans' medical savings accounts.

Being exposed to HSA insurance did not always mean that doctors were in the know.

"We were surprised that about a quarter of physicians who currently knew that they cared for patients in consumer-directed health plans said they really didn't have a lot of knowledge about the cost-sharing involved in these plans," Pollack said.

While most felt ready to discuss the cost of office visits, medications and laboratory tests, half or fewer were prepared to advise patients about the cost of radiologic studies, specialist consultations and hospitalizations.

People enrolled in Health Savings Accounts are encouraged to take advantage of online tools to compare costs and evaluate quality when making medical decisions. But, according to the survey, physicians are deeply skeptical about the information provided by government and insurance Web sites.

With more knowledge and education, Health Savings Accounts will continue to help individuals, families, and even doctors deal with our current health insurance situation.

Posted by Wiley Long at 04:46 PM | Comments (0)

December 05, 2008

BBB Advice on Health Savings Accounts

Rising healthcare costs are forcing small business owners to decide whether or not they can afford to provide health coverage for their employees. Some employers are choosing to contribute to Health Savings Accounts (HSA) for employees as an alternative to paying for health insurance, and Better Business Bureau is providing guidance for small business owners on whether Health Savings Accounts could be a viable option for their company.

According to a recently released Kaiser Family Foundation study, in 2008 employer-sponsored health insurance for a family cost an average of $12,680 - a five percent increase from 2007 - with one-fourth of that cost paid by employers...

While the cost of healthcare is high now, there’s more bad news for business owners in the future. Unfortunately, it appears that employer healthcare costs are only going to increase, according to a Hewitt Associates study that estimates costs are expected to rise 6.4 percent in 2009.

“Employers have found that providing health insurance is an effective way to attract and retain a quality workforce, however, the rising cost of healthcare is making it harder for businesses to provide that incentive,” said Steve Cox, BBB spokesperson. “Health savings accounts are an alternative for cash-strapped businesses to trim healthcare costs while still providing healthcare incentives for employees.”

According to a 2008 report from the United States Government Accountability Office, the number of individuals covered by HSA-eligible plans increased significantly between September 2004 and January 2007—from about 438,000 to approximately 4.5 million.

Following are some guidelines and background information from BBB on Health Savings Accounts:

The Basics
Health Savings Accounts were established as part of the Medicare Prescription Drug Improvement and Modernization Act of 2003. Health Savings Accounts are designed as an account into which both employers and employees can make tax-free contributions. The accumulated money is the property of the employee and is used to pay for medical expenses.

Eligibility
In order for employees to maintain a Health Savings Account they must also be part of a high-deductible healthcare plan and cannot be covered by other health insurance (dental, vision or disability is permissible, however).

Tax Incentives
Employee contributions to an HSA are above-the-line tax deductions. As well, earnings such as interest and dividends are tax-exempt. Withdrawals from the accounts are tax-free as long as the money is used for medical expenses.

Contributions
The maximum contribution for an HSA is $2,900 for single coverage and $5,800 for families. Business owners can contribute to their employees’ HSA at any point and in any amount, however they must make comparable contributions to all participating employees. Contributions do not have to be the same for part-time versus full-time employees.

Administrative Costs
Another benefit for small business owners is that there are minimal administrative costs associated with Health Savings Accounts since the accounts are self-administered by the employee.

Posted by Wiley Long at 08:18 AM | Comments (0)

November 26, 2008

Health Savings Accounts Approach $4 Billion Mark

Since the products became available in 2004, consumers have opened 2.9 million Health Savings Accounts (HSA) and have collectively banked more than $3.9 billion, according to Inside Consumer-Direct Care's (ICDC) semiannual report on Health Savings Accounts. The average account balance, however, remained virtually unchanged at $1,348 - up just $7 since January. A year ago, financial firms said they collectively held more than $2.33 billion in 1.76 million accounts. By Jan. 1, 2008, assets had grown to $3.2 billion in 2.2 million accounts. The report is based on data from more than 40 financial firms that regularly provide ICDC with account figures.

Also included in the estimate are data gathered from another 40 firms for AIS's' 2007 HSA Directory and Resource Guide. A similar report on credit unions will be included in an upcoming issue of ICDC.

Several financial firms reported dramatic growth in volume and assets over the past year. First Horizon Msaver, Inc., based in Overland Park, Kan., says it has opened 95,000 Health Savings Accounts and holds $90 million in assets. That's up from 50,000 accounts and $76 million in assets as of Jan. 1, and from 35,000 accounts and $50 million in assets a year ago.

Msaver spokesperson Marty Trussell says health plans are increasing their use of continuing-education sessions and other training opportunities for agents and brokers to promote the adoption of HSA-qualified plans.

OptumHealth, a subsidiary of UnitedHealth Group, is the largest HSA firm in terms of assets with $633 million in nearly 400,000 accounts. ACS/Mellon HSA Solution is the largest in terms of account volume with 530,000 and $436 million in assets. Wisconsin-based HSA Bank was the second largest firm in terms of assets with $580 million in 220,000 accounts.

ACS/Mellon spokesperson Tom Hrick expects to see more consolidation among HSA administrators. While many banks are going after the growing HSA business, profit margins for the accounts "are too thin to support firms that don't already have a base of accounts."

The rocky economy, combined with increasing health coverage costs, will add to the appeal of HSA-qualified plans, says Sterling HSA CEO Cora Tellez. Bill West, president of First HSA, Inc., agrees and says he expects steady growth in the year ahead. "Four-dollar-a-gallon gas and higher insurance premiums are making many people look at HSA-qualified plans, he says. However, many are still afraid to make the leap unless there is a financial incentive or and they have no other choice," he asserts. West adds that more midsized employers are shifting to full-replacement HSA plans. John Sweeney, spokesperson for Draper, Utah-based HealthEquity, Inc. predicts account volume will "at least double" over the next year.

Larry Deegan, vice president of business development at Illinois-based American Chartered Bank, says he would be "disappointed if we did not have 35,000 to 40,000 accounts by the end of 2009." The bank, he adds, does not have any health plan partnerships. As of Sept. 1, the bank had 23,000 accounts and held nearly $40 million in assets.

Deegan says one of the most popular plan designs he's seeing these days includes an annual deductible of $2,500 for single coverage and $5,000 for family and provides 100% in-network coverage once the deductible is met. Premiums for those plans are between 25% and 40% lower than are premiums for more traditional PPOs. "That allows employers to provide funding for the accounts," he says.

Employers, especially those in the small-group market, need to do a better job of explaining the financial benefits of Health Savings Accounts to their employees. Even in instances where an HSA-based plan is the best deal, employees tend to remain with the more expensive PPO plan, Deegan complains.

Posted by Wiley Long at 10:26 AM | Comments (0)

November 14, 2008

Health Savings Accounts Create Choice

At the National Consumer Driven Healthcare Conference I went to, one of the speakers was Samuel Gibbs, Senior Vice President of ehealth insurance. He spoke about online health insurance shopping. They’ve found that one of the main criteria consumers want to know is "is my doctor in the network?" Another sign that consumer's want choice with their Health Savings Account, particularly when it comes to who their doctor is.

They also want fast. He said that when they got some carriers to offer instant approval, sales increased 30%. They are highly focused on making the sale without talking to the consumer, and in fact get 80% of their business without any direct communication. (While HSA for America does of course offer online applications, we also have Personal Advisors that will give direction on which plan will be the best value, and also walk the customer through the application process.)

Posted by Wiley Long at 10:42 AM | Comments (0)

November 11, 2008

Health savings accounts can help you save now and later

The concept behind Health Savings Accounts is pretty simple: You put money into a tax-favored account to pay for medical expenses now and in the future.

For most people, the hard part is understanding the high-deductible health plans they must choose to qualify for a Health Savings Account. These plans require participants to pay more of the cost of care before insurance picks up its share.

Preventive care and diagnostic tests, however, often are covered in full.

"We don't want them to scrimp on those," said Mike Debo, a sales executive with Anthem Blue Cross and Blue Shield in St. Louis. "We don't want them to be tempted not to have those tests done."

High-deductible health plans are becoming more common as employers search for ways to cut health care costs. The thinking is that consumers will be more selective about the use of health care if they're paying a bigger share of the costs, said Katie Davis, senior marketing specialist at Enterprise Bank & Trust Co.

"We have to get people to understand that the costs of health care are expensive," said Randy Ressel, vice president of sales for Anthem Blue Cross. "Co-pays mask the cost of care."

High-deductible plans cost less than conventional insurance, so many employers agree to put money into health savings accounts that can be used to offset the deductible. Employees also can contribute to the accounts. The money can be used for a broad range of medical expenses, from meeting deductibles to paying for medicines and medical equipment.

Next year, a plan must have at least a $1,150 deductible for an individual and $2,300 for a family to qualify as a high-deducti­ble plan. (That's up from $1,100 for an individual and $2,200 for a family this year.) The maximum out-of-pocket cost for such plans next year will be $5,800 for an individual and $11,600 for a family.

Instead of co-pays of $10 to $40 for doctor visits, consumers pay for services until they reach the deductible and then pay a percentage of the cost up to the out-of-pocket maximum. Rates for doctor visits and other services are negotiated by an insurance company, but consumers are encouraged to shop around for the best deal.

Next year individuals can put up to $3,000 a year in a Health Savings Account, and families can add up to $5,950. If you're 55 or older, you can put in another $1,000.

The accounts have triple tax benefits. The money comes out of your paycheck before taxes, and it grows tax-free in the account. When you use the money to pay for medical expenses, there's no tax on that, either.

Jay Savan, a principal with Towers Perrin in Clayton, said the plans can be a good deal regardless of your health or age if you understand them and plan for expenses accordingly.

Buying insurance is all about balancing fixed and variable risks, he said. The fixed risk is the premium. The variable risk is the amount you'll spend in a year on health care for deductibles, co-payments and other costs.

High deductible plans cost less, reducing the fixed risk. Consumers can prepare for the variable risk with the health savings account. If actual costs are less than the amount you saved, you have money left for future care.

Savan said he recently priced a traditional preferred provider plan with a $500 deductible and $2,500 out-of-pocket maximum against a high-deductible plan with a $2,500 deductible.

The traditional plan cost $1,600 more in premium, in addition to the $2,500 deductible. In addition, the buyer of a traditional plan would have pharmacy and physician co-payments, which don't count against the out-of-pocket limits.

With the high-deductible plan, the $1,600 savings could go into a health savings account. The account's tax benefit of $448 (for someone in the 28 percent tax bracket) translates into $2,048 in purchasing power, Savan said.

Consumers need to estimate their total health care costs for a year under both types of plans. They need to make sure they're comparing the same kinds of care and health care providers as well. For some, the health savings account makes sense. For others, a traditional plan may work better.

Unlike flexible spending accounts, health savings accounts aren't a use-it-or-lose-it proposition. You don't have to use the money the same year you put it into the account.

The money can be invested in a variety of vehicles, from interest-bearing accounts to mutual funds. Health Savings Accounts also are portable, which means you can take the money with you if you change jobs or retire.

In retirement, money from a health savings account can be used to pay premiums for Medicare Part A or B or for long-term care insurance. You can take money out for purposes other than health care, but then you pay tax on the withdrawal.

Mark Baker, a health savings account specialist with Golden Rule Insurance Co., said the plans are especially appealing to self-employed individuals because they can reduce premiums significantly and sock the savings away in an HSA.

"We're also seeing a lot of families who are working for employers who can't afford to buy them coverage," Baker said. Some employers offer to give employees a fixed amount to buy coverage.

"They want an affordable plan that will cover them for something truly serious," Baker said. "They can put money away and save it and use it for normal health care for their families."

Posted by Wiley Long at 10:56 AM | Comments (0)

November 03, 2008

Consumers Demanding Health Savings Accounts

Consumers are demanding a much greater role in decisions involving their health care, says Grace-Marie Turner, president of the Galen Institute.

For the past six years, the U.S. health care sector has been moving toward more market-based solutions with Health Savings Accounts, introducing patient choice and competition into a system that has largely been dominated by top-down, centralized management, says Turner. For example:

* Consumers have new incentives to become partners in managing their health costs through financing options such as Health Savings Accounts (HSAs) and Health Reimbursement Arrangements (HRAs).

* Individuals and companies are saving money on health costs as a result.

* Choice and competition have been introduced in public programs such as Medicare and Medicaid, showing people can choose among competing health plans that have new incentives to offer better benefits at a lower cost.

The bottom line, says Turner, is that a market-based solution to the health care crisis is a win/win/win:

* It is a win for the uninsured because millions more Americans would have the chance to buy health insurance.

* It is a win for the states because they would have more flexibility to direct federal resources to meet the needs of citizens to get affordable health insurance.

* It is a win for employees because they would have the opportunity to buy health insurance they can own and can take it with them from job to job, giving them more control over decisions involving their health insurance and health care.

Posted by Wiley Long at 12:08 PM | Comments (0)

October 29, 2008

Lower Your Health Insurance Costs with a Health Savings Account

With inflation exceeding 5%, are you searching for ways to cut expenses and save for retirement? While often overlooked, a Health Savings Account can significantly lower your health insurance costs and provide a tax-free way to save money for retirement.

For you health insurance needs, you should consider the combination of a High Deductible Health Plan with a Health Savings Account. These health insurance plans are often undersold by insurance agents due to the lower commissions they receive. However, when compared to a traditional health insurance plan, the combination will virtually always reduce your health care costs.

Health Savings Accounts are often characterized as only being advantageous for the healthy and the wealthy. This assertion is wrong! As long as you contribute the maximum annual amount to your HSA, you High Deductible Health Insurance plan will virtually always save you money on your health care costs, regardless of your health care expenses.

Health Savings Accounts provide three financial advantages over traditional health insurance policies:

1) If a traditional health care plan, with a $1,500 family deductible, costs $400 per month, an HDHP, with a $4,000 family deductible, will typically cost around 25% less or $300 per month. In this example, the HDHP provides a $1200 per year savings on insurance premiums.

2) When you contribute the family maximum to your HSA, a $5,800 tax deduction is applied to both federal and most state income taxes. If family taxable income exceeds $65,100, all incremental income is taxed at 25% for federal income taxes and 4.63% for Colorado state income taxes. The $5,800 maximum HSA deduction provides a combined federal and state income tax savings of $1,718.50.

3) Medical expenses paid from your HSA are made with tax-free dollars. With a traditional health plan, all expenses are paid in after tax dollars. Thus, paying the traditional plan’s $1,500 family deductible will require before tax earnings of $2,132.

Let’s assume that your health care costs exceed $4,000 in 2008. On an after tax basis, the traditional health insurance plan’s deductible will save you $1,868 over the $4,000 HSA deductible. However, HDHP premiums are $1,200 less and the HSA deposit saves you $1,718.50 in federal and state income taxes. Combining both the premium and income tax savings, the HDHP/HSA plan costs $1050.50 less than a traditional health insurance plan, at the maximum HDHP deductible amount of $4,000. HDHP plans also have no co-pays and often pay 100% of all medical expenses after the deductible is met.

If your family is healthy and you only require $1,000 in medical expenses for the year, the annual after tax savings with the HDHP is $3,340. This represents the sum of the HDHP insurance premium savings, the HSA income tax savings and $421 saved by paying the $1,000 in medical expenses with HSA funds that are never taxed.

An HSA is the only savings device that combines the income tax savings of an IRA with the tax free withdrawal of a Roth IRA. Like an IRA, funds deposited into an HSA are completely deductible from your income taxes, even if you don’t itemize. Like a Roth IRA, HSA funds can be withdrawn tax free at any time, to pay for medical expenses.

If your finances will allow, use current income to pay medical expenses and save your HSA funds until retirement. The Employee Benefit Research Institute estimates that a 65 year old will require $164,000 in medical expenses if they live 20 years after retirement. With HSA funds growing tax free, you could potentially have “free” medical care throughout your retirement years.

As long as you fully fund your HSA account and are in at least the 25% federal income tax bracket, you will virtually always come out ahead with the HDHP/HSA. When it comes time to renew your health insurance coverage, consider the HDHP/HSA approach. It will save you money and it can provide an excellent savings vehicle for your retirement years.

Learn more about what a Health Savings Account can do for you at HSA for America

Posted by Wiley Long at 09:50 AM | Comments (0)

October 23, 2008

Health Savings Accounts at the NCDH Summit

I’m in Washington D.C., at the National Consumer Driven Healthcare Summit where Health Savings Accounts are being discussed as a way to save consumers money. There are so many ways consumers can save money if they simply take a more proactive role in managing their own health care. Robert Neese, of HealthScripts, reported that under utilization of generic prescription drugs costs consumers over $42 billion a year. Greater use of mail order prescriptions will also save money, and leads to better therapy adherence to boot!

Learn more about Health Savings Accounts and how you can save money on your health care at http://www.health--savings--accounts.com

Posted by Wiley Long at 03:40 PM | Comments (0)

October 20, 2008

Using Your Health Savings Account to Become CEO of Your Own Healthcare

At the National Consumer Driven Healthcare Summit, Elizabeth Bewley gave a fascinating talk titled "Consumers Need to Become CEOs of Their Own Health and Health Care." Health Savings Accounts can help you do just that.

During her talk, Ms. Bewley explained how our modern health care system is set up to benefit interests other than you. For instance, she spoke of a condition called ICU Psychosis, that affects many patients after spending time in intensive care. This problem manifests as a form of delirium or psychotic episodes, and is caused by the typical conditions in ICU - bright lights, noise, sleep deprivation, confusion about night and day, etc.

The first step in being your own healthcare CEO is to take care of your health. Simply staying out of the hospital could save your life. The Institute of Medicine reports that medical errors cause about 100,000 deaths annually, making this the third leading cause of death. Hospital-contracted infections kill another 100,000 a year. Adverse drug events kill an additional 125,000. Thus, approximately 17% of total deaths in the U.S. may be attributable to medical care.

Up to one half of prescribed drugs do not work for patients as intended, and physicians rarely explain possible adverse side effects or how long the patient should take the drug. Bottom line, the system is not individual-centric, but rather built for the needs of the providers. To take more control, consumers need to ask more questions; create a personal health record; and realize that they, not the doctor, are in charge of their own health.

If you don't have already have a Health Savings Account, I urge you to sign up for an HSA-qualified health insurance plan an open an HSA today. You can then become CEO of your own health care with the help of your Health Savings Account.

Posted by Wiley Long at 03:30 PM | Comments (0)

October 14, 2008

CDC Report on Health Savings Account Plans

The Centers for Disease Control reports that 20.3 percent of all people under age 65 now have a high-deductible health plan (HDHP)--more than the number covered by public programs (19.4 percent). The HDHP is defined as having a deductible of at least $1,100 for an individual or $2,200 for a family. You can view the report here: http://www.cdc.gov/nchs/data/nhis/earlyrelease/insur200809.htm

What this means is that people are becoming more and more aware of Health Savings Accounts.

In fact, many experts are predicting a surge in Health Savings Account enrollments among federal employees in the next year, which will further accerate the consumer-driven healthcare movement.

Next week I will be attending the National Consumer Driven Healthcare Summit in Washington DC, and I’m sure I’ll have plenty to report. What is clear is that there has been no better time, ever, to switch to an HSA-qualified health insurance plan. Consumer’s don’t have extra money to blow on an expensive copay plan, and they could use all the tax breaks they can get.

Learn more about Health Savings Accounts at http://www.health--savings--accounts.com

Posted by Wiley Long at 10:26 AM | Comments (0)

October 06, 2008

Health Savings Account Enrollments Continue To Rise

With insurance coverage and account custodian openings increasing, three new Health Savings Account trends are beginning to surfaced in the latest round of research conducted by Information Strategies, Inc. (ISI).

At the same time, account custodian numbers continue to grow with an average 18% increase on a quarter-to-quarter basis for the period ending June 30.

While the total number HSA accounts are growing, expected to double in 2008, there is a definite seasonality to purchases.

Third quarter expansion will be less than in the first two quarters of 2008 but greater efforts focused on adding sign-ups is expected in the final three months with a significant increase in total insurance and account custodian usage predicted for January 2009.

Among the other findings of the latest 2,000+ interviews with HSA purchasers are:

Individuals continue to be significant purchasers of HSA insurance.

Larger companies are joining with smaller entities in offering Health Savings Accounts to their employees.

Contributions to Health Savings Accounts are rising but the impact of layoffs is depleting some reserve funds.

One trend surfaced in this latest flight of interviews was that younger employees are embracing Health Savings Accounts as a retirement/emergency funding program. To date, ISI has interviewed more than 34,000 HSA users over the past four years.

Of the 312 respondents who had lost their jobs in the first half of 2008, 56% said they had used HSA account monies to pay some or all of their COBRA charges.

Fully 11% of individuals interviewed said they had been given funds in lieu of a company sponsored healthcare benefits program.

ISI also has identified significant changes in agent/broker attitudes towards these consumer directed offerings. The percentage of agents reporting that they include Health Savings Accounts in their first proposals to company management has risen past the 30% mark.

One interesting new statistic that is encouraging for insurance providers is the fact that that the number of respondents who said Health Savings Accounts were their first choice rose above 50%. This is the first time this preference has been reported by a majority of respondents.

A significant majority of respondents (61%) also said that they were not cutting down on their contributions due to the spike in fuel costs. Many (27%) did say they might delay depositing the monies for a quarter to see how the impact of high costs is affecting their total financial position.

Posted by Wiley Long at 10:14 AM | Comments (0)

September 23, 2008

High Deductible Health Plan Consumers Report Satisfaction

A recent survey release by HSA Bank has shown that high deductible health plan respondents are more likely to be engaged consumers who ask about costs prior to making an appointment, seek information about generic prescription alternatives and select lower cost treatment alternatives. The results were compiled from HSA Bank's Consumer Benchmark Survey, which provides current data regarding consumer characteristics and expectations, as well as consumer healthcare purchasing behaviors.

More than 730 respondents answered the 30-question survey. Nearly two-thirds of the respondents had a high deductible health plan. Of those respondents, 87.8 percent also reported having a Health Savings Account.

Additional highlights from the survey include:

-- When rating their overall health, no statistically significant difference exists between the respondents with a high deductible health plan and those in a traditional health plan.

-- Respondents with a high deductible health plan were no more or less likely to decide against or delay treatment due to cost when a treatment was recommended in the past 12 months.

-- Nearly 73 percent of the respondents with a high deductible health plan chose that plan over a traditional health plan option.

"The data collected in the survey suggests that people in high deductible health plans seek healthcare at the same rate as those in traditional plans, but with the added benefit of making careful consumer choices," said Kirk Hoewisch, president of HSA Bank.

You may download HSA Bank's Consumer Benchmark Survey Report at the following web address: http://www.hsabank.com/WorkArea/showcontent.aspx?contentID=2048

Posted by Wiley Long at 10:45 AM | Comments (0)

September 01, 2008

The Push to Make Health Savings Accounts Even Better

John C. Goodman, president of the National Center for Policy Analysis, also known as "the father of Health Savings Accounts" for having helped to create the HSA, has been meeting with government and business leaders this year to support the adoption of what he calls "Universal Health Savings Accounts."

This type of consumer-driven health plan would replace all other such plans, such as Health Savings Accounts, Flexible Spending Accounts (FSA) and Health Reimbursement Arrangements (HRA), he said.

The motivation is the same -- to give the consumer more control and replace all such consumer driven health plans with just a single account: the Universal Health Savings Account.

A number of problems have surfaced with the current forms of consumer-driven plans, says Goodman:

* The law for who can have a Health Savings Account is too restrictive; and with FSAs, there is no rollover from year to year; lastly, with HRAs, there is no portability of benefits if a person changes jobs.

* Federal laws that govern Health Savings Accounts allow individuals to squirrel away up to $2,850 and $5,650 for families, tax-free, each year.

* Those funds can be rolled over from year to year as well as carried from job to job.

* The current form of Health Savings Accounts is flawed because they must be paired with insurance plans with high deductibles of at least $1,100 or more for individuals or $2,200 for families.

"Ideally, people should be able to combine a Health Savings Account with any plan, regardless of any deductible or co-payments," Goodman said.

Goodman did not provide specific numbers about the number of people who might opt for the new form of HSA, but said that with the change, "I would imagine virtually everyone who saves at all would tend to opt for a Universal Health Savings Account," he said. "The reason: You can do everything with an HSA that you can do with an IRA or 401(k) plan, and buy tax-free health care."

Learn more about Health Savings Accounts at: http://www.health--savings--accounts.com

Posted by Wiley Long at 03:35 PM | Comments (0)

August 10, 2008

Health Savings Account Contribution Question

I have a Health Savings Account that was opened when my employer switched to a high-deductible policy. My pre-tax deductions were deposited in the Health Savings Account from my paycheck. I have moved to another employer that does not offer a high-deductible policy. Can I still contribute to the Health Savings Account? If so, are the contributions tax-deductible? Can I still pay health-related costs from the Health Savings Account?

You can only make Health Savings Account contributions for the months that you were covered under an HSA-qualified high-deductible health insurance plan. But...

if you didn't make the maximum contributions that were allowed when you were eligible, then you may still be able to contribute the remainder of the money.

For example, if you had HSA-qualified health insurance plan from January 1 to April 31, 2008, then you were eligible to make four months' worth of contributions. The maximum contribution limit for 2008 is $2,900 for people who are not yet age 55 with individual coverage. So you could contribute $966.67 (4/12 of $2,900). If you only had $200 taken out of your paycheck every month for the Health Savings Account ($800 total), then you can still contribute $166.67 to your Health Savings Account for 2008.

Because your contributions are no longer subtracted from your pay before taxes, you'll need to deduct those extra contributions when you file your 2008 income tax return (the last day for making 2008 contributions will be April 15, 2009).

Good news on the second half of your question: You can always use money from an existing Health Savings Account tax-free to pay out-of-pocket medical expenses in any year, even if you can't make new contributions, as long as the expenses were incurred after you opened the Health Savings Account.

You can learn more about Health Savings Accounts at: http://www.health--savings--accounts.com

Posted by Wiley Long at 03:22 PM | Comments (0)

July 23, 2008

Things to Know About Health Savings Accounts

Health savings accounts have become very popular. Since their introduction in 2004, approximately 2.5 million Americans have enrolled in Health Savings Account (HSA) qualified health plans. But, alas, HSA plans are not for everyone.

Here are some pointers to help you consider whether a Health Savings Account will benefit you and your family:

An HSA plan can cut healthcare costs by an average of 40% for many people.

Nevertheless, some people will not realize any net savings. Those most likely to realize significant savings are people who pay all of their own health insurance premiums, such as the self-employed, who are relatively healthy with few medical expenses.

A health savings plan restores freedom of choice.

An HSA plan puts individual consumers back in control of their own health care. This also means that each individual must be more responsible for his or her own health care decisions. This approach of self-reliance is not always popular with or appropriate for everyone, especially those who have become comfortable with HMO-type "co-pay" plans.

Health Savings Accounts reduce income taxes.

Every dollar contributed into your HSA account is deducted from your taxable income in the same manner as contributions into a traditional IRA account, regardless of whether you spend it or just save it. Interest and investment earnings in a HSA accumulate tax-deferred, just like a traditional IRA.

Unlike an IRA, withdrawals are tax-FREE when used to pay qualifying medical expenses. In many situations, new account holders are able to almost fully fund their HSA with money saved on premiums from a prior, higher priced plan. By stashing all or most of those savings into an HSA, the account holder realizes instant, additional savings in the form of reduced taxes.

You must have a properly qualified high deductible health insurance policy in place first before you can open a Health Savings Account.

One of the biggest misconceptions about HSA plans is that any insurance policy with a high deductible will qualify the policyholder to establish an HSA account. IRS regulations, however, are quite specific. Not just any policy with a so-called "high deductible" will suffice. It is important to be certain that you are insured under a properly qualified policy. Your best bet is to work with a qualified and duly licensed health insurance broker who is experienced in marketing properly qualified HSA plans.

You must be insurable in order to qualify for the HSA-qualified health insurance policy.

Because most people do not have a properly qualified high deductible insurance policy, they will need to switch insurance plans in order to become HSA-eligible. Unless coverage is being offered under small group reform laws (generally groups with 2-49 employees), the new high deductible plan will be individually underwritten by an insurance company.

This means that some "pre-existing" conditions may not be fully covered. Alternatively, some companies may opt to cover certain "pre-existing" conditions in exchange for slightly higher premiums. Unfortunately, some health conditions simply render an individual uninsurable (examples: diabetes, chron's disease, heart attack, etc.). Underwriting requirements vary by state, which is another reason to rely on an experienced health plan broker.

Although HSA insurance premiums are low, they are not always as low as you might expect.

This happens for one main reason. Simply stated, the underlying insurance policy is just that—a health insurance policy. Although it has a "high" deductible, as required by law, the insurance company still must compensate for the risk it is assuming over the deductible amount, which it does by charging premiums.

Many companies offer policies with “one deductible” that all family members contribute toward. With those plans, it is not uncommon for premiums for a 5000 family deductible with 100% coverage after the deductible to be comparable to a 2500 "per person" deductible plan with 80/20 coverage after the deductible.

Lower premiums represent just one element of the lower net cost achieved with an HSA plan. The low net cost of an HSA plan is achieved after factoring in the benefits of lower taxes, made possible by the tax-deductible contribution to the HSA account. Thus, if obtaining the lowest possible gross premium is your main concern, you may wish to consider a high deductible, non-HSA policy, especially if you do not see the benefit to contributing to a tax-deductible savings account.

In the end, the HSA plan usually ends up being the low cost health insurance alternative after factoring in the net advantage gained from instant tax savings and long term tax-favorable growth.

An HSA offers your best chance to keep a lid on health insurance rate increases.

Make no mistake-you will have rate increases with your HSA insurance policy. Because an HSA qualified policy is still a health insurance policy at heart, there is no logical reason to presuppose that an HSA policy would be immune to rate increases required by an insurer to keep paying claims and stay in business.

But what you can expect is that the actual dollar amount of any future rate increases will be substantially lower compared to traditional health insurance plans (regular PPO and HMO plans). This is true because insurers base increases on percentages, and the same percentage of a lower base premium results in a lower dollar increase. It's not a perfect solution-but it is the most cost-efficient solution for many qualified people.

Learn more about Health Savings Accounts at: http://www.health--savings--accounts.com

Posted by Wiley Long at 05:24 PM | Comments (0)

July 04, 2008

Celebrating Independence Day and Health Savings Accounts

People who carry a Health Savings Account insurance plan tend to value their freedom and independence. Similarly to our founding fathers, people with Health Savings Accounts find they can do better by taking personal responsibility for their fate, rather than depend on the government (or King) to take care of their every need. On this 4th of July, allow me to share with you a little history of Independence Day.

By the middle of the 1700s, the thirteen colonies that made up part of the British Empire in the New World found it difficult to be ruled by a king 3,000 miles away (King George III). They were sick and tired of the taxes imposed upon them. The colonists objected paying taxes to England while they had no say in the decisions of the British Parliament.

They voiced their grievances with England. But rather than negotiating, King George sent extra soldiers to the colonies to help control any rebellion that might take place. The following timeline explains the important events that lead to the signing of the Declaration of Independence and America’s split from England’s rule.

September 1774: The 13 colonies sent delegates to Philadelphia, Pennsylvania, to form the First Continental Congress. At this time, although they were frustrated with England, the colonies were not ready to break away from the mother land.

April 1775: British troops advanced on Concord, Massachusetts, motivating Paul Revere to ride across the land to warn about the approaching English soldiers, announcing: “The British are coming, the British are coming.” The battle of Concord became known as the “shot heard round the world” and marked the unofficial beginning of the American Revolution.

May 1776: After trying to work out their differences with England for almost a year without any success, the colonies again sent delegates to the Second Continental Congress.

June 1776: Realizing their efforts were hopeless, Congress decided to become free from British rule. So they formed a committee to create a document declaring independence from the crown – the Declaration of Independence. Thomas Jefferson headed this committee, which also included John Adams, Benjamin Franklin, Philip Livingston, and Roger Sherman.

June 28, 1776: Jefferson presented the first draft of the Declaration of Independence to Congress.

July 4, 1776: After various changes to Jefferson’s original draft, Congress voted in the afternoon on that day. And, of the 13 colonies, 9 voted in favor of the Declaration; 2 (Pennsylvania and South Carolina) voted No; Delaware was undecided; and New York abstained. John Hancock, President of the Continental Congress, was the first to sign the Declaration of Independence.

July 6, 1776: The Pennsylvania Evening Post printed the Declaration of Independence.

July 8, 1776: In Philadelphia’s Independence Square, the first public reading of the declaration took place. The colonists rejoiced when they heard it. The bell in Independence Hall (then known as the “Province Bell”) would later be renamed the “Liberty Bell” after its inscription: “Proclaim Liberty Throughout All the Land Unto All the Inhabitants Thereof.”

August 1776: While the signing of the Declaration of Independence started on July 4th, it was completed in August. Even so, the Fourth of July was accepted as the official anniversary of United States independence from England. A new nation was born.

July 4, 1777: The first Independence Day celebration took place in Philadelphia. People rang bells and lighted candles and firecrackers. Now, although the colonists started celebrating their independence from Britain in 1777, the War of Independence lasted until 1783. And while Congress made Independence Day an official holiday that year, it wasn’t until 1941 that the Fourth of July was declared a federal holiday.

As Thomas Jefferson alledgedly said, "The price of liberty is eternal vigilence". Today there are still forces trying to reduce our freedoms. One that hits home on this blog is the push for socialized medicine. As is evidenced in several countries (Canada, Britain), this type of system limits choices, increases waiting lists, and prevents people from controlling their own healthcare. That’s why so many Canadians come to the U.S. for treatment each year.

At HSA for America, we’re commited to saving you money, and protecting your individual health freedom. Happy Independence Day.

Posted by Wiley Long at 03:13 PM | Comments (0)

July 01, 2008

Statistics Report On Health Savings Account Usage

Canopy Financial has announced the release of their inaugural Health Savings Account (HSA) Market Report for Q1 2008. The report aggregates and tracks statistics related to actual HSA usage via a series of key market indicators and will be published quarterly.

As evidenced in the report, Q1 2008 realized significant quarter-over-quarter growth in average funds held in both HSA deposit and investment accounts - as high as 25% for deposit accounts - indicating that Health Savings Accounts are being used as savings account vehicles with larger average balances than the average retail checking account.

"Canopy's HSA Market Report aggregates real consumer account data nationally to describe key features of HSA usage," said Vik Kashyap, CEO of Canopy Financial. "The report is significant in that it shows that Americans are using Health Savings Accounts not only for health expenditures, but as long-term savings and investment vehicles."

Average investment account inflows were more than double average outflows for the quarter. HSA account holders age 50+ had more than double the amount invested at the end of Q1 on average compared with account holders age 25-40.

Additionally, the HSA Market Report for Q1 2008 shows an increased spend of 10% on average in family plan accounts, with a slightly increased spend on average in individual plan accounts. The report breaks out actual spend characteristics by category, including bill payments, reimbursements, debit card transactions, checks, and ATM withdrawals. It also provides key data on Customer Service Representative (CSR) touches for the quarter.

Their report can be downloaded at http://www.canopyfi.com/hsa_stat_report.pdf

Posted by Wiley Long at 09:23 AM | Comments (0)

June 23, 2008

Retailers Helping to Track Health Savings Account Expenses

CVS pharmacy, Target, and other retailers are starting to make it easier to track eligible expenses for Health Savings Accounts.

"The use of Health Savings Accounts has grown dramatically over the past two years - a 35 percent increase since last year," said Rob Price, senior vice president of marketing for CVS/pharmacy. "But many consumers don't realize that managing their funds throughout the year can be simple and, more importantly, can result in significant cost-savings, particularly for those with chronic conditions."

CVS pharmacy, Target, and other retailer registers now provide shoppers with register receipts that highlight prescription medicines, over-the-counter remedies and other HSA-qualified purchases so they can be easily identified and tracked with a special symbol indicating which items are HSA eligible.

As more and more retailers start to track HSA-qualified expenses on customers receipts, keeping track of HSA expenses will become easier and easier for Health Savings Account owners.

Visit http://www.health--savings--accounts.com to learn more about the money saving advantages of Health Savings Accounts.

Posted by Wiley Long at 02:10 PM | Comments (0)

June 10, 2008

4.5 million enrolled in Health Savings Accounts

A new census released by America’s Health Insurance Plans (AHIP) discovered that 4.5 million Americans - a 43 percent increase from last year - are covered by lower-premium, high-deductible health insurance plans offered in conjunction with Health Savings Accounts (HSAs).

The census found that 27 percent of those purchasing HSA plans in the individual market were previously uninsured and almost half of those enrolled in such plans were older than age 40.

In addition, the census reveals that HSA plans provide value-added services. Most companies offer HSA plans that cover preventive care before the deductible is met, provide disease management programs for chronic conditions, and include a wide array of Web-based tools to help consumers make more informed decisions.

This is the first AHIP census to compile information about the savings accounts in conjunction with HSA plans. Eighty-eight percent of Health Savings Accounts in place in 2006 had average annual balances of $2,500 or less, while 4 percent had average annual balances more than $5,000. As of January 2007, 65 percent of accounts had been in place for less than one year.

The full census is available at: www.ahipresearch.org

Posted by Wiley Long at 10:27 AM | Comments (0)

June 02, 2008

What Can A Health Savings Account Do For Your Family

Giving your family health insurance a checkup is a smart way to save money. That’s the news from analysts who say that in many cases, switching from a traditional family health insurance plan to a high deductible plan with a Health Savings Account will significantly cut your annual health insurance costs.

Indeed, for many families with yearly medical expenses of about $1,500, the total savings often exceed $6,000 a year, which includes tax reductions of $1,500 or more, as well as health insurance premium savings. Lets take a closer look at Health Savings Accounts:

Simply put, Health Savings Accounts are alternatives to traditional health insurance that offer tax advantages and greater control over a person’s medical expenses. With a Health Savings Account (HSA), you can pay for current health expenses (and save for future qualified medical) all on a tax-free basis. Our Web site www.HSAforAmerica.com provides detailed information on the accounts.

Our website also features an HSA calculator that lets users determine the potential future value of their HSA based on their expected contributions and expenses.

Using a Health Savings Account

You can choose to use HSA funds to pay for qualified medical expenses (for example, office visits, lab work and prescription drugs) before you have met your annual deductible. These covered expenses will still count toward your annual deductible. But HSA funds can also be used for qualified services not covered by a health plan, such as dental care, weight loss programs and eyeglasses. These expenses, however, do not count toward your annual deductible.

Opening Your Health Savings Account

To open an HSA, you must be covered by a High Deductible Health Plan (HDHP). Once you’re enrolled, you own and have complete control over the money in your HSA, meaning you decide how and where to invest it to grow your account. Find a good bank to set up your Health Savings Account on our HSA Administrator page.

Health Savings Accounts will help families save thousands of dollars on their health insurance costs.

Posted by Wiley Long at 09:16 PM | Comments (2)

May 28, 2008

Census Shows 4.5 million enrolled in Health Savings Accounts

A new census released by America's Health Insurance Plans (AHIP) discovered that 4.5 million Americans - a 43 percent increase from last year - are covered by lower-premium, high-deductible health insurance plans offered in conjunction with Health Savings Accounts.

The census found that 27 percent of those purchasing Health Savings Account plans in the individual market were previously uninsured and almost half of those enrolled in such plans were older than age 40.

In addition, the census reveals that HSA plans provide value-added services. Most companies offer HSA plans that cover preventive care before the deductible is met, provide disease management programs for chronic conditions, and include a wide array of Web-based tools to help consumers make more informed decisions.

This is the first AHIP census to compile information about Health Savings Accounts in conjunction with HSA plans. Eighty-eight percent of accounts in place in 2006 had average annual balances of $2,500 or less, while 4 percent had average annual balances more than $5,000. As of January 2007, 65 percent of accounts had been in place for less than one year.

Learn more about Health Savings Accounts at: http://www.health--savings--accounts.com

Posted by Wiley Long at 09:28 AM | Comments (0)

May 20, 2008

Health Savings Accounts Attacked by Backroom Earmark

Congressman Pete Stark (D-CA) is next in line to be the Chairman of the House Ways and Means Committee. He's probably also public enemy number one to Health Savings Accounts. He has tucking an earmark into a tax bill which would cripple and undermine Health Savings Accounts.

First, some background: HSA funds can generally only be used for qualified medical expenses. Taking money out for non-medical reasons generally results in taxes owed on the withdrawal, plus a 10% penalty. Taxpayers assert that the withdrawal was for medical expenses (or not) on their tax return, under penalty of perjury.

Like any other deduction, liars and cheats are caught using the IRS's audit process as it has been done for many years.

But that's not good enough for Stark. He wants to have HSA holders get independent verification that the withdrawals were qualified. Not coincidentally, there is only one company (Evolution Benefits) that has the technology to do this, and it's the one lobbying for this provision.

This provision is a win for both Evolution Benefits (who gets to corner the market on third-party substantiation, for which they have a patent), and Pete Stark (since he knows this will scare off banks, businesses, and consumers from offering Health Savings Accounts). And since it will drive up costs on Health Savings Accounts, this is a mortal threat to taxpayers who use Health Savings Accounts.

Posted by Wiley Long at 10:13 AM | Comments (0)

May 16, 2008

Use of Health Savings Accounts Continue to Grow

In a market where health insurance costs continue to rise for employers, more companies are turning to high-deductible health plans – and the accompanying Health Savings Accounts – to help defray costs.

An estimated 7 million people are covered by 2.2 million Health Savings Accounts as of the beginning of 2008, according to a survey by industry publishing company Atlantic Information Services Inc. Those HSA accounts hold $3.2 billion, up 60 percent from $2 billion at the beginning of 2007.

Several banks that offer Health Savings Accounts say the accounts’ popularity is growing – especially among small businesses that want to reduce their costs while still offering insurance benefits to employees.

The advantages

Kansas City-based UMB Bank, which has four branches in Springfield, passed the $100 million mark for Health Savings Accounts systemwide in January, marking a 52 percent increase in account balances compared to the previous 12 months.

Dennis Triplett, president of UMB Financial Corp. Healthcare Services, said health insurance premium costs have been outpacing inflation – average premium percentage increases have hit double digits each of the last five years, while inflation has averaged only 2.8 percent – making companies eager to reduce insurance expenses.

“One thing (employers) can look at is increasing co-pays and deductibles, and having employees pay greater shares of the premium,” said Triplett, who is based in Kansas City but was scheduled to visit Springfield April 11. “They’ve done some of that, but now they’re looking at other things that can be done, and one is consumer-directed health care with a higher deductible.”

Higher deductibles mean higher risk for employees, but Missouri State University finance professor Stanley Adamson said that increased risk means lower premiums, making the trade-off attractive to employers and some employees.

He added that Health Savings Accounts allow individuals to have total control over their money – how it’s invested and what it’s used for – and can accumulate funds over time.

“If those monies aren’t used entirely in a year, you can continue to accumulate the money and draw interest on it, saving it for when and if you need it,” Adamson said of HSAs. “With a traditional flexible spending account, when you put money aside, if you don’t use it (before year’s end), you lose it.”

On the downside

Despite such advantages, Adamson said employee perception is among the drawbacks to Health Savings Accounts.

“If you’re dealing with an employee that is relatively low-income, these increases in front-end deductibles are going to be viewed as a reduction in benefits,” he said. “It’s not going to be well-received by any employee probably, but certainly not those with lower incomes.”

He noted that reductions in taxable income aren’t a big incentive for low-income employees, as 40 percent of all Americans don’t make enough money to pay income taxes at all.

Adamson also said that some companies offer the high-deductible health plans and accompanying Health Savings Accounts in addition to a traditional insurance plan – but this, too, has its risks.

“The higher-income people, or the younger and healthier people, would opt for the high-deductible plan, leaving the older and higher-risk people in the other plan, which would cause premiums to increase,” he said.

UMB’s Triplett said the biggest challenge associated with Health Savings Accounts is educating consumers to think differently about health care.

“The biggest challenge is how to communicate the concept, because it is a change in the basic way people look at health care,” he said. “How do you get the employee to understand that they are now engaged in the process, that these are their dollars and they have control over how they can be spent?”

Growing demand

Challenges aside, demand for Health Savings Accounts is only expected to grow. The U.S. Treasury Department estimates that, assuming the laws regulating Health Savings Accounts are unchanged, up to 30 million people will be covered by Health Savings Accounts by 2010.

“I can think of no disadvantages to the accounts,” said Doug Marrs, chief operating officer for Great Southern Bank. “If you qualify for it and can possibly scrape together the funds for an HSA – and I don’t care where it is or who it’s with – it’s a huge advantage.”

Marrs said Great Southern began offering Health Savings Accounts shortly after they were created in 2004. He declined to say how many accounts the bank had, though he said it was “several hundred.”

Even banks that don’t offer the accounts see the benefits. While Commerce Bank doesn’t offer Health Savings Accounts, Vice President Karen Favor said they are being considered for the institution’s portfolio.

The bank is particularly interested in Health Savings Accounts targeted at small businesses rather than individuals.

“I think there’s a lot of educational issues that go along with the (individual) offering,” Favor said. “Customers drive by a branch, see that we offer Health Savings Accounts and might think they can have one, when in truth they’re going to have a certain type of health care plan and there’s a lot of tax implications and ramifications. That’s I think why the employer channel is more attractive to Commerce, because we’ll know we’re targeting the right audience.”

Posted by Wiley Long at 08:27 AM | Comments (2)

May 08, 2008

A Health Savings Account Can Meet Your Family's Health Needs

Making sure that your family is able to stay healthy partly depends on having a good health insurance program for them. One of the more recent new additions to the health insurance industry is called the Health Savings Account (HSA). This new program enables you to have reduced insurance rates because of a higher deductible, and a tax deferred savings program with it. Here are some of the features of this program:

Reduced Rates

By getting a health insurance program with a high deductible, you are able to greatly reduce your monthly premiums. This is an especially good way to go, if you are younger and currently have pretty good health. The deductible amounts are pre-determined by the government, and you are required to have deductible amounts between $1,050 and $5,250 for singles, and it needs to be between $2,100 and $10,500 for families.

Savings Are Tax Exempt

One of the great benefits of this type of plan is that, like an IRA, you enjoy tax-free income, and interest on the amounts you have in the program. You can put into the plan money that comes off the top of your taxes. There are limits, though, and for singles it is up to $2,700, and for families it is $5,450. A little extra benefit is that you are able to take off of your taxes any money that is deposited into the account all the way up to April 15th. So, if you are coming up to tax time, and find you need to reduce your taxes some more, you can put it into your HSA, and find the tax break you need.

Better Coverage

Health Savings Accounts have an extra real nice feature - they cover more. Some things that you may not have been covered for under another type of policy, you may find that you are covered for with an HSA. This could actually allow you to get a better coverage for less. Things like dental coverage, therapy, even non-prescription medicines and some alternative treatments may also be covered, and even some mental illness treatments, too.

You Keep Control

Under an HSA, you are the one in control of the money. It is yours to use. You can take money out of the account when you want, but only the money that is used only for medical purposes is tax-exempt. Generally, you will be given a card, like a credit card, that gives you access to the account. Whenever you use money from the account, the insurance company automatically gets a receipt, and it is subtracted from your account, and your deductible - and it remains tax exempt.

Like any other insurance policy, once you have paid the deductible amounts, the rest is up to the insurer to pay. By having the high deductible you reduce the premiums considerably. The savings account can also provide a good hedge for your medical insurance program for the future, too, because any money not used toward the deductible remains your money – to use next year, if you need it. On the other hand, the money in your HSA might also be used to provide some money for retirement - assuming you maintain your good health.

Posted by Wiley Long at 10:08 AM | Comments (0)

May 05, 2008

Employer Interest in Health Savings Accounts Is Growing in Colorado

Fifteen percent of Colorado employers offered Health Savings Accounts (HSAs) in 2007, and 23 percent considered offering one, according to a survey conducted by the Mountain States Employers Council (MSEC).

"It's a good thing!" said Linda Gorman, director of health care policy at the Colorado-based Independence Institute. "The more choice you give people, the better off they are. You have more choice with the HSA because you can spend it on anything the IRS deems a legitimate health expense."

Patty Goodwin, overseer of the MSEC study published in February, said she knew of no similar national survey. However, she said she thought Colorado was probably on par with the rest of the nation in HSA offerings.

Lack of Familiarity

One of the biggest challenges HSA advocates face is simply convincing people to explore a less-familiar way of managing health coverage, said Goodwin.

Though many employers offer both Health Savings Accounts and traditional health insurance, she explained employers and employees have a general lack of understanding about them. This causes employees to cling to their traditional plan even if they could benefit from a health savings account.

"HSA adoption rates have usually been dependent on how well the employer educates people to the plan," said Gorman, though even well-informed employees struggle with deciding whether an HSA works best for them.

The tradeoff, Gorman explained, is that the lower cost of an HSA comes with a higher deductible. Consequently, "people are taking baby steps into Health Savings Accounts."

Greater Choice

Because the money paying for medical care comes out of a bank account instead of an insurance company's checkbook, people must decide for themselves whether an illness merits a trip to the doctor or whether they'd be better off waiting it out, Goodwin noted. As an alternative, some HSA owners explore preventive medicine and focus on wellness instead of treating sickness as it happens.

Proponents of Health Savings Accounts maintain HSAs offer a good option overall for consumers who want more control of their medical coverage.

"Here's another way that maybe we can help curb health care costs while giving consumers more choice," said Goodwin.

Posted by Wiley Long at 11:23 AM | Comments (0)

April 29, 2008

Managing Costs With Your Health Savings Account

As health care consumers and employers look to Health Savings Accounts and high deductible plans to reduce their health insurance premiums, the insured are at higher risk for their medical expenses. In exchange for lower premiums, health care consumers spend hundreds or even thousands of dollars on deductibles before their insurance companies pay a nickel. The new trend has health care consumers scrambling.

Denver medical providers offer advice:

1.) Choose the appropriate place of service for healthcare needs, and avoid the emergency room if at all possible. Even with insurance company discounts, an ER visit will cost you more than $500.00.

2.) Call your primary care physician for an appointment before seeking treatment elsewhere. Treatment in your physician's office is almost always the least expensive alternative for accessing healthcare for minor injuries and illnesses.

3.) Consider an urgent care center or clinic for non-life and limb threatening injuries and illnesses, when your physician office is closed or unable to accommodate an appointment. Your average visit will likely cost about $150.

4.) Ask for self-pay or payment in full discounts at the time of service.

Denver's AfterOurs Urgent Care Centers offer patients who pay for their visits at the time of service substantial discounts. "Two out of ten insurance claims are denied for some reason, leaving patients in the middle. Collecting payment at the time of service reduces our administrative costs, so we are able to offer considerable discounts to our patients. Most (patients) have high deductible plans anyway. Payment information is forwarded to the patient's insurance company, so their payment amount is recognized by the insurance company and applied to their deductible. The difference is whether we collect the patient's portion up front or later", said Chris Rehm, Executive Director of AfterOurs Urgent Care.

So what happens when a patient pays more at the time of service than their insurance company allows for? Under current insurance laws, medical providers who collect more from the patient at the time of service than the insurance company is contracted to pay, must refund any overpayment directly to the patient. "Overpayments rarely happen on the front end, because we have good knowledge of our insurance contracts and new technology allows us access to patient deductible balances," stated David White, Co-Owner of Denver based Pinnacle Medical Billing. "Some payors contractually restrict the practice of collecting deductibles up front, and we can't require anyone to take advantage of the opportunity, but most insurance companies are happy that they and there patients save time and money by paying at the time of service."

Learn more about Health Savings Accounts

Posted by Wiley Long at 07:30 AM | Comments (0)

April 24, 2008

Survey Shows Satisfaction in Health Savings Account Plans Increasing

The Commonwealth Fund teamed up with the Employee Benefits Research Institute (EBRI) to publish the results of an annual, Internet-based survey on the experiences of enrollees in health plans with different levels of cost-sharing.

The previous three surveys all showed enrollees were not as satisfied with Health Savings Account (HSA) plans as those in comprehensive plans. However, satisfaction has improved in the most recent survey:

- Satisfaction rates were similar for the quality of care received (71 percent in HSA plans compared to 74 percent in comprehensive plans).

- Satisfaction with physician network was also very similar across both plans (76 percent HSA; 74 percent comprehensive plan).

- Overall, enrollees in comprehensive plans reported being more satisfied (92 percent claimed to be "extremely" or "very" or "somewhat" satisfied vs. 85 percent in HSA plans).

What supposedly most annoyed Health Savings Account enrollees was higher out-of-pocket spending:

- Twice as many were dissatisfied with out-of-pocket spending (43 percent) compared to those enrolled in comprehensive plans (21 percent).

- Yet, nearly two-thirds of HSA enrollees (63 percent) reported having a choice of health plan, compared to only 54 percent of those in comprehensive plans.

When asked why people chose their plans:

- Some 51 percent of HSA enrollees reported lower cost of premiums; 46 percent because they could save money and rollover later use; 28 percent of HSA enrollees liked the ability to control their own health care dollars.

- Of those in comprehensive plans; 41 percent chose the plan for its low cost-sharing, while 29 percent chose it for low premiums; controlling their own funds and savings for the future was negligible to them.

Learn more about Health Savings Accounts at: http://www.health--savings--accounts.com

Posted by Wiley Long at 12:02 PM | Comments (0)

April 18, 2008

Do You Qualify For a Health Savings Account

I am 60 and retired with sources of income from investments and pensions, but no earned income. Would I qualify for a Health Savings Account if I took out a high-deductible policy?

You sure can, and it's a great idea. Unlike with IRAs, you don't need to have earned income to qualify for a Health Savings Account. Instead, you just need to open a high-deductible health insurance policy. For 2008, the deductible must be at least $1,100 for individual coverage or $2,200 for family coverage.

Then you can make tax-deductible contributions to a Health Savings Account. In 2008, most people can contribute up to $2,900 to an HSA if you have individual coverage, or up to $5,800 for family coverage. People who are age 55 and older also can make a $900 catch-up contribution in 2008. You can't contribute to an HSA after you sign up for Medicare at age 65.

You don't need income from a job to take advantage of the tax deduction. "They can deduct their contributions from any type of taxable income, such as earnings from investments, even if it is not earned income," says Roy Ramthun, president of HSA Consulting Services in Washington, D.C.

The money accumulates tax-deferred in the account, and you can use it tax free for medical expenses in any year. After age 65, you can use the Health Savings Account money for anything without a penalty. But it's still best to reserve the account for health care costs, which can spare you the tax bill.

If you're on Medicare, the Health Savings Account should still come in handy for plenty of out-of-pocket expenses, such as co-payments and deductibles as well as premiums for Medicare, Medicare Advantage or Part D (but not medigap premiums). You also can use the money for part of the premiums for qualified long-term care insurance policies.

For more about Health Savings Accounts, visit us online at: http://www.Health--Savings--Accounts.com

Posted by Wiley Long at 09:21 AM | Comments (0)

April 08, 2008

Health Savings Accounts Are A Great Business Opportunity

Some business owners say they never like to sit tight. They're always thinking of new schemes to make millions. Chocolate chip cookies stuffed with bubble gum. Golf balls with GPS devices. A working cell phone.

They're jealous of those entrepreneurs that fail at 87 businesses before finally getting it right. They've seen photos of them vacationing in Tahiti with a bikini-clad model under each arm, and we say why not us?

So, as a public service to anyone who wants to start a new business, here's a great idea to chew on: Sell and service Health Savings Accounts (HSAs)... No, I'm not kidding.

What are Health Savings Accounts you ask? Exactly! I say. If you're not intimately familiar with them now, you will be. Oh, you will be.

Health Savings Accounts are not new. But they're getting hot. How do they work? How can you cash in? Read on.

First, you need to find a new client... any business with more than five employees and a standard health insurance plan will do. Let's say your marketing machine produces a prospect for you. We'll call him Bob. "Bob," you say. "It's time to make some changes to your employees' health insurance and really save them some money."

You then sell Bob a new health insurance plan that's been preapproved by the government (or you might be able to use his existing one). The biggest change is that the deductibles get raised significantly (and his premiums go down accordingly). But before Bob and his employees panic, you explain to him that at the same time you're going to open up a Health Savings Account for each participant. No worries.

During the year, when Bob gets his paycheck, an amount comes out and is deposited into his own HSA account that you administer. It's taken out before taxes, lowering his taxable income (and therefore lowering his tax). It's still his. It's not going anywhere. It just gets stuck in an account earmarked for health expenses. It's earning interest. And he can withdraw it for any reason, without penalty, when he hits 65. Bob's breathing a little easier.

One little thing. Just tell Bob or any member of his family not to get sick. OK?

You see, if Bob or one of his family has a health issue, he has to take money from the account to pay the deductible. Once the money's used up, the insurance policy kicks in so he's covered. But if there are no health issues, he gets to keep the money year after year. So Bob should tell his kids to stop their whining. There's nothing a little Motrin can't handle, OK?

Back to the money. If Bob is covering his family he can put away more than $5K each year pre-tax, which is more than a $1,500 tax savings every year. Sweet! And if he's over 50 right now he can "catch up" on contributions too so he's putting money away for health benefits when he gets older and starts wearing diapers.

So here's the summary: Health Savings Accounts lower health premiums for companies (higher deductibles equal lower premiums). They lower taxes for the participants. They help save money for the future. If a participant dies because he or she didn't want to pay money for a doctor's visit then, hey, blame it on Darwin.

Business owners are going to wake up to this someday. It's too easy to setup. It's too much of a slam dunk. In fact, it's estimated that there will be more than $75 billion invested in Health Savings Accounts by 2010. Ka-ching! Don't want to go into this line of business yet? Fair enough. But at the very least, you may want to make it a point to investigate Health Savings Accounts. It's the penny pinching kind of thing to do. But please, don't cough near me. I don't want to have to pay for a doctor's visit either!

Posted by Wiley Long at 02:42 PM | Comments (0)

March 07, 2008

Health Savings Account Owners Get New Tool to Compare Prices

You can buy almost anything online these days, but try shopping the Internet for an MRI, strep throat test or even an annual physical exam and you'll run into roadblocks. Health Savings Account owners know the frustrations and are always looking for better ways to shop for health care.

A new Twin Cities company called Carol is trying to change that with a Web site that gives Health Savings Account consumers a "care marketplace" to search for medical services, compare quality and price, and make appointments.

Carol joins an effort to transform the U.S. health care system by putting consumers in charge and letting the market do its work.

"We want to let consumers define value," said Tony Miller, Carol's founder and chief executive officer. "We don't have care competition in the marketplace today."

The free site, which went live in January, generates revenue from health care providers who become "tenants" on the site. When a consumer sets up an appointment with a clinic or doctor on Carol.com, the provider pays the site a fee.

While limited to about 30 providers in the Twin Cities area at its launch, the company is adding others and plans to serve a second U.S. market sometime this year, Miller said.

Health care experts said Carol will face challenges in getting enough doctors and health plans to participate. But they said it goes farther than previous efforts to use the Web to enhance medical choice, and they praised its ease of use.

Instead of going through a list of doctors or clinics, users tell the site what they're looking for by clicking on parts of the body.

For instance, if a consumer clicked on "entire body," then "annual exam," and chose a routine physical for women age 40-64, the results page would show six different options ranging from $207 to $335. After selecting a number of options, consumers can click "compare" and see exactly what each exam would entail. They can also read a description of the doctor or clinic's philosophy and link to ratings by MN Community Measurement, a nonprofit that measures health care performance in Minnesota.

Consumers who have insurance can type in plan information to have Carol.com estimate their out-of-pocket cost.

Miller said Carol is sensitive to consumer privacy, allowing people to search the site without registering, and it won't market to individual consumers even if they do register.

"The fact that they have a basic set of providers and prices and care packages is very impressive," said Greg Scandlen, president of the advocacy group Consumers for Health Care Choices, which lobbies against government regulation of the health care market.

But Dr. Sidney Wolfe, director of Public Citizen's Health Research Group, said the site is nothing more than advertising, and he hoped it wouldn't catch on.

"Among physicians, there's a belief that health care is too critical ... to be left to the usual marketplace," he said.

If the site becomes more comprehensive, Carol.com would be most useful to people with high-deductible plans, Health Savings Accounts or those without health insurance, said Elizabeth Boehm, an analyst with Forrester Research who studies the health care customer's experience.

She was skeptical of the site's prospects because many people's choices are limited by their HMO.

"(Price is) just not what drives people to make their health care choices," Boehm said. "The challenge for a site like this is that while conceptually it's good ... the reality is there are only a small group of customers looking for that."

But Miller said consumers are starting to realize that choosing cheap health care might come back to haunt them in the form of higher premiums or other increased costs. And he thinks there are plenty of people like him who might want different options for care and are willing to pay more out-of-pocket to get what they want.

He said his idea for Carol came in part from his own experience with a heart condition for which he was told he needed surgery. A second professional recommended medication, which Miller, 41, said worked.

"I had the wherewithal and some of the contacts to help me navigate and find answers in the health care system. Most consumers don't have that," said Miller, a partner in the venture capital firm Lemhi Ventures, which has invested $25 million in Carol.

Park Nicollet Clinic, one of the bigger providers in the Twin Cities with nearly 700 doctors, was one of the first to embrace the Carol idea. Chief executive David Wessner said the clinic was already looking at ways to deliver value to patients and wasn't afraid to reveal prices.

"We just think there really is a crisis in value in health care. One of the things that helps us address that crisis is to package high value services and start to be willing to compete on that," Wessner said.

Psychiatrist Ronald Groat said Carol is important because it makes health care "more visible and transparent to someone who's looking for help."

Health Savings Account owners stand to benefit from sites like Carol.com. As more and more tools become available to compare and shop for health care services, the marketplace will respond!

Posted by Wiley Long at 10:41 AM | Comments (0)

February 29, 2008

Employers Explore Health Savings Account Options

David Martin, owner of Accucam in Coopersville, Mich., thought he had run out of health-care options for his workers when the provider of his group health plan dropped their coverage. Premiums had doubled the prior year, and participation dwindled to three of 15 workers.

So instead of providing group insurance, Mr. Martin is offering allowances -- such as contributions to Health Savings Accounts -- to employees who buy their own coverage in the individual market. Other small and medium-size employers are also providing stipends to workers who buy their own coverage through similar defined contribution programs.

By adopting such strategies, employers aim to shield themselves from premium increases and reduce administrative burdens, while providing employees with help toward their medical expenses, a key element for recruiting and keeping staff.

It's a paradigm shift from employer-sponsored plans to employee-owned coverage. Individual policies are portable, so workers don't have to worry about losing coverage if they change jobs. Plus, employees keep the funds in their Health Savings Account.

Critics say workers with health problems may end up paying very high premiums, face exclusions for existing medical conditions, or wind up without insurance in the state-regulated individual market -- challenges not faced in group plans. In addition, when adopting novel ways of providing benefits, employers need to be mindful that they comply with state and federal laws.

According to the Kaiser Family Foundation, 59% of small companies offered health benefits in 2007, down from 68% in 2000. Over that time period, annual premiums have almost doubled, to $12,106 for family coverage and $4,479 for an individual.

"[That is] just too expensive," says Mr. Martin, who used to split premiums 50-50 with employees. Now, he is offering to contribute $1,000 annually to the Health Savings Accounts of workers who buy high-deductible health plans.

High Deductible Health Plans have lower premiums than the more-traditional types of plans, but enrollees have to pay more out-of-pocket costs before insurance coverage kicks in. By law, funds in an HSA generally can't be used to pay for premiums, but workers can spend the funds tax-free on HSA qualified health-care expenses.

Mr. Martin has purchased a policy and six workers are now shopping for coverage. By law, to open an HSA, employees must purchase a health plan with a deductible of at least $1,100 for an individual and $2,200 for a family.

Meanwhile, in San Francisco, Andrew Hoag, co-founder of Zwaggle.com, an Internet site where parents can trade in their kids gear, is testing technology company Canopy Financial Inc.'s MyCanopy.com.

Through MyCanopy.com, employers provide workers with a fixed amount of money each month that they can use to enroll in an HDHP, which they can pick through the site, and to fund accompanying HSAs.

Mr. Hoag says the system makes it easy for him to manage costs and forecast expenditures, while workers have more control over -- and a bigger stake in -- their health spending. He is likely to give $500 per person each quarter to workers who enroll -- maybe more to those who can't get coverage because of health problems.

Canopy Financial Chairman and Chief Executive Vikram Kashyap says MyCanopy.com is working with insurers on developing products for people who can't get insurance because of past or present illnesses, and is making headway in California. MyCanopy.com also has teamed up with a company that specializes in helping people access state high-risk pools where the uninsurable can get coverage.

Karen Politz, a research professor at Georgetown University's Health Policy Institute, is one of the skeptics. Some 30 states have high-risk pools, but the premiums can be as much as double the usual rate. And some, such as in Florida, are closed to new enrollment because of lack of funding. Fewer than 200,000 Americans are covered through high-risk pools. As a coverage option, says Ms. Politz, "It's a fig leaf."

When adopting novel programs, employers need to be mindful that they comply with applicable state laws as well as federal rules on benefits, which are regulated by the Treasury and Labor departments.

Posted by Wiley Long at 01:49 PM | Comments (0)

February 20, 2008

Health Savings Accounts Helping to Counter Rising Insurance Premiums

A recently released national survey regarding employee benefits produced results that should hardly be shocking - that health insurance is expensive and costs continue to rise at an alarming rate.

To combat this trend, thousands of companies have found an option to their liking - "IRA-like" Health Savings Accounts. Reasons are abundant as to why Health Savings Accounts are growing in popularity to employees:

• Health Savings Accounts are not subject to "use it or lose it" provisions, meaning accumulated funds are not forfeited if not used for medical expenses.

• Health Savings Accounts provide an attractive way to save money. Similar to a 401(k) account, Health Savings Accounts are funded with pre-tax dollars. But unlike a 401(k), where the funds grow tax-deferred until withdrawn, the money in an HSA grows tax-free.

• If the participant changes his or her health care plan or goes on to Medicare, the accumulated money can still be used tax-free to pay Medicare deductibles and long-term care insurance.

To be eligible for an HSA, an individual must be covered under a high-deductible health plan that has an annual deductible of at least $1,100 for an individual or $2,200 for a family and an annual out-of-pocket limit of $5,500 for an individual or $11,000 for a family. Currently, the maximum annual deductible contribution can be made by the participant, an individual outside of employment or by the participant's employer.

For employers who subsidize their employees' insurance, Health Savings Accounts can produce dramatic savings. One 50-employee client of ours was facing a 16 percent increase in premiums under a traditional co-pay health-care plan. By choosing the HSA option, the firm saved 21 percent on its current premium and 31 percent off the renewal premium — an annual savings of $113,000. Health Savings Accounts for other clients of ours have produced savings of 56 percent ($52,000), 25 percent ($111,000), 31 percent ($113,000), 27 percent ($15,000) and 42 percent ($57,000).

Health Savings Accounts are catching on in popularity because once you have reached your deductible, all covered services, including doctor visits and prescriptions, are 100 percent paid.

One employee said the pre-tax deduction from his salary to the HSA produced a savings of $1,300 in taxes for his family. And by being enrolled in the Health Savings Account, thousands of dollars were saved that might not have been under a traditional health plan.

His wife experienced a high-risk pregnancy in the beginning of the year and hit the maximum out-of-pocket expense of the plan, $3,000. By May, he was picking up prescriptions at his pharmacy at no charge. His son had to go to the emergency room, no charge. His wife delivered the baby in August, no charge. And he and his family have had no charges for any medical care or prescription drugs for the rest of 2007.

Had he stayed on the traditional plan, as opposed to an HSA, he would have paid the higher premium, the prescription drugs every month, the hospital fee, the physician charges in the hospital, the emergency room visit, etc. The HSA-plan saved his family $3,250 in 2007.

In summary, more and more savvy companies looking to help their employees with insurance are turning to the HSA model as a way to protect themselves from escalating premiums and to offer their employees a creative way to shelter their wages. It's a win-win situation worth evaluating for your company.

Posted by Wiley Long at 09:20 PM | Comments (0)

January 29, 2008

Health Savings Accounts Are Becoming Infectious

In most American homes, the rising cost of good health care - like the rising costs of gasoline and home heating - remains a perpetual kitchen-table discussion. There are trends that are catching the attention of consumers and industry alike, and it appears they will continue to shape the health-coverage market.

As more Americans search for alternative, affordable ways to find coverage for health care, they are increasingly being drawn to Health Savings Accounts. The Treasury Department forecasts that, by 2010, 25 million to 30 million Americans will be covered by Health Savings Accounts.

How it works: With a Health Savings Account (HSA), in conjunction with a high-deductible health insurance policy, money is placed into a tax-deferred health account. That money can be withdrawn without any tax penalty as long as it is used for medical purposes - including vision and dental care. As the money in the HSA grows, it builds financial resources a patient can use for routine or future medical care. Any money left in the account at the end of the year rolls over to the next year. The leftover funds are the individual's to keep, and more money is added in the new year.

HSAs are a smart option for the self-employed, owners of small businesses, and employees and people whose companies are dropping health benefits.

Initially a boutique health-coverage product, HSAs are now being offered by virtually all of the top insurance companies, such as Aetna Inc., Cigna Corp., and Blue Cross and Blue Shield. The company that pioneered the HSA concept, UnitedHealth Group Inc.'s Golden Rule Insurance Co., reports that more than 40 percent of its customer base is now covered by Health Savings Accounts.

Both consumers and employers are driving this trend in the market. The share of all companies - not just those with fewer than 200 workers - now offering HSA plans is up to 40 percent. The 75,000 people who work for Eastman Kodak Co. will be offered three health plans this open enrollment season, including a plan in which they would not have to pay any premiums but have a higher deductible – and that plan will include a Health Savings Account.

Small and self-employed businesses - where the overwhelming majority of American jobs are being created - continue to turn to HSAs as a cost-effective way to cover workers. Tom Terrill, a suburban Chicago insurance broker, recently told the Chicago Tribune that small businesses are turning to HSAs in greater numbers in the Chicago area because "data is mounting to demonstrate their merits."

Government is part of the trend as well. In their new contract with Orange County, Calif., the county's 1,600 sheriff's deputies have a provision that phases in HSAs as a substitute for what the county traditionally grants to retirees.

Even some labor unions are proposing HSAs be put in their next contract. In Tiverton, R.I., the teachers union proposed moving from traditional health insurance to a high-deductible plan that would include a Health Savings Account. The city and the union eventually agreed on a contract without HSAs, but the union's proposal is noteworthy. Past congressional debates over HSAs once featured organized labor's opposition; the Tiverton teachers union is an affiliate of the National Education Association, proof that minds and hearts change over time.

The growing popularity is rooted in the product's middle name: savings. A consumer will typically save up to 50 percent on an HSA plan premium over traditional health plans.

Further, an HSA policyholder has more control over his or her health-care budget; you make the decision when to spend and when to save. And the money you don't spend accumulates year after year earning interest - reserves that can help meet the increased health costs of later life and retirement.

Some of the working population is lucky enough to have a traditional health-insurance plan that works for them, but for the rapidly growing number of people who are swiftly losing their benefits, HSAs are not only a cost-effective alternative, but one that allows them a lot of freedom.

The market is changing. Employers, self-employed people, workers, consumers and governments are adjusting. But in this cost-conscious environment, it is virtually certain these trends will continue and many consumers can still benefit from what have been positive changes in health coverage options.

Posted by Wiley Long at 07:41 AM | Comments (0)

January 23, 2008

AHIP Survey Shows Health Savings Accounts Making Health Care Coverage Accessible and Affordable

A comprehensive survey of the individual health insurance market recently released by America's Health Insurance Plans (AHIP) found that health care coverage is more accessible and affordable than is widely known. The survey found that premiums are affordable, most who applied were offered coverage, and that consumers have access to a wide variety of benefit options to meet their individual needs. In addition, Health Savings Accounts (HSAs) continue to be a popular coverage option among consumers.

"Consumers purchasing individual health care coverage have access to a wide variety of affordable health care coverage options," said Karen Ignagni, President and CEO of AHIP. "Most applicants, regardless of age, were offered health care coverage at an affordable rate, giving them peace of mind and protecting their health security."

The new study, Individual Health Insurance 2006-2007: A Comprehensive Survey of Premiums, Availability, and Benefits, is the most comprehensive survey of the individual health insurance market and is a follow up to several previous AHIP surveys.

According to the survey, nine out of ten applicants (89 percent) who went through the application process were offered coverage. Forty percent of these offers were at standard premium rates and 49 percent were offered at lower (preferred) rates. Even among those age 60-64, seventy-one percent were offered coverage and three-quarters (74 percent) of these were at standard or preferred rates.

Nationwide, annual premiums averaged $2,613 for single coverage and $5,799 for family plans in the 2006-2007 period. Premiums varied by state, reflecting a variety of factors, including premium rating and underwriting rules, differences in health care costs, demographics, and consumer benefit preferences. Premiums were significantly higher in states with restrictions on premium variation and underwriting, often known as "guaranteed issue" and "community rating." However, approximately 95 percent of the policies surveyed were sold in states where the average annual premium was under $3,400 for single coverage or $7,200 for family coverage.

Consumers in the individual market were offered a wide range of benefits, including mental or behavioral health, prescription drugs, preventive, and maternity benefits. Some level of behavioral health coverage was included in nine out of ten policies purchased. Coverage for complementary and alternative therapy was also quite popular, while vision and dental coverage were chosen much less frequently.

The most commonly purchased coverage option was preferred provider organization (PPO) / point-of-service (POS) coverage, representing 78 percent of single policies and 66 percent of family policies in force.

Health savings accounts (HSAs) continue to be a popular coverage option among consumers in the individual market. Ten percent of single policies and 23 percent of family policies chosen provided coverage in conjunction with an HSA. Notably, the average out-of-pocket maximum paid by consumers with an HSA policy often is not much higher than the average plan deductible, meaning many HSA plans consider the deductible to be the primary form of cost-sharing.

Most of the policies chosen had annual out-of-pocket limits under $5,000, and the average lifetime maximum benefit (among plans with a maximum) was nearly $4 million.

Click here to view the entire survey: http://www.ahipresearch.org/pdfs/Individual_Market_Survey_December_2007.pdf

Posted by Wiley Long at 11:37 AM | Comments (0)

January 17, 2008

Health Savings Account Money Year to Year

A Health Savings Account (HSA) is an amazing tool to reduce your healthcare expenses and insurance costs. But do you lose your money at the end of each year, like with a Flexible Savings Account (FSA)?

Thank goodness, no! You do not lose your HSA money at the end of each year.

Health Savings Accounts were created specifically to be BETTER than their predecessors, Flexible Savings Accounts (FSA) and Medical Savings Accounts (MSA).

Your HSA does not have to be used up within the year. In fact, the money can just build and build each year if you don’t need it. It will be there for your health crisis if that ever happens.

If you never have that health crisis (and I hope that’s the case for you!) then you will have a nice little nest egg built up of year-after-year health savings account investments plus the interest earned.

We really like the term "Health Savings Account." We like it because it says that you can save by being healthy. The healthier you are, the more money you’ll have left in your HSA when you retire.

And speaking of retirement, your HSA will act like a nice Individual Retirement Account (IRA) as soon as you reach age 65. You’ll be able to withdraw money without penalty for any reason you wish. (But you’ll still have to pay tax on withdrawal, just like with a traditional IRA).

Our advice to you is put the maximum amount into your HSA every year. The money will be there for you if you have a health crisis, and it will be there for you in retirement if you manage to stay healthy year-after-year.

Good luck with your healthcare, your health insurance and your HSA! If you are looking for more information on Health Savings Accounts, visit us online at: http://www.health--savings--accounts.com

Posted by Wiley Long at 10:10 AM | Comments (0)

January 05, 2008

Health Savings Accounts Make Insurance Portable

One of the great things about Health Savings Accounts is that they are portable -- if you switch jobs, you don't have to switch your Health Savings Account.

However, the same can't be said for health insurance -- traditional or HSA-eligible insurance. About 65 percent of Americans have employer-provided coverage, and when they switch jobs (almost every five years, on average) they have to leave one health plan and switch to another.

Changing policies can sometimes mean changing doctors, dentists, mental health professionals, and other providers, but not always. If you can find new insurance where your doctors are still in the network, you can benefit by lowering your insurance premiums.

Every year, insurance companies will usually raise your premium payments. By staying healthy and being able to switch insurance companies, you can get back into first year premiums which are almost always lower than the premiums you are currently paying.

Learn more about Health Savings Accounts at: http://www.health--savings--accounts.com

Posted by Wiley Long at 10:54 AM | Comments (0)

December 26, 2007

Health Savings Accounts Helping Employer Sponsored Health Care

The primary reason for the decline in the number of small businesses providing health insurance appears to be that owners of new firms are reluctant to introduce health benefits, according to a National Federation of Independent Business Small-Business Poll.

The poll on purchasing health insurance found that 52 percent of small-business owners do not offer either employee health insurance or an insurance purchase subsidy. However, Health Savings Accounts are helping to reverse this trend.

"It's much better for employee morale if a small-business owner never offers health benefits, than it is to offer them and then be forced to take it away because it is too expensive to continue," said William J. Dennis, NFIB's senior research fellow. "Small-business owners experience considerable turmoil in their early years. They often experience cash flow problems and are reluctant to incur additional expenses such as health insurance. What's new to this picture is that it appears that new small-business owners are waiting longer or choosing not to offer health insurance benefits to their employees at all."

Excluding those who switch insurers or go out of business, very few small employers drop health insurance benefits all together, about 1- 2 percent of the population annually.

For the 47 percent of small employers who do offer some type of employee health benefit, 36 percent offer insurance to all or most full-time employees, 5 percent offer insurance to some or a few full-time employees, and 6 percent offer premium reimbursement to employees who purchase health insurance on their own.

According to the poll, the owner or manager is the person most likely to shop on behalf of the firm for health insurance, and they rely heavily on insurance agents or brokers for guidance This does not always serve them well. Survey data found that agents/brokers did not raise the subject of Health Savings Accounts (HSAs) in 59 percent of cases involving their discussion of employee health insurance with small employers.

"This poll tells us that if small-business owners want to know about all of their health insurance options, they need to conduct their own research. They need to be able to ask their insurance agents very pointed questions about HSAs and other health insurance options," said Dennis.

I know this is wishful thinking on my part, but with over half of our workers employed in small businesses perhaps it is time to uncouple health insurance from our tax code. The system we now have in America is based on the economy of the mid-1900s when most workers were employed by large corporations (one in five worked for Fortune 500 during that era). Health insurance for employees was a loop-whole to that unions and corporations concocted to get around wage freezes post World War II. This same alliance used Nixon's wage freeze as a reason to move from high-deductible major medical plans to low deductible insurance plans.

Just as economic crises created the mess that is now our health insurance system, perhaps the impending train wreck that is today's health insurance model in the US can lead us to a consumer driven free-market model.

National Federation of Independent Business Small-Business Poll

Posted by Wiley Long at 11:02 AM | Comments (1)

December 17, 2007

2007 Year-End Health Savings Account Strategies

A Health Savings Account (HSA) can be an important part of your tax and money-management strategy. Not only can you reduce your health insurance premiums, but when you fund your account you get a nice tax break. If you stay healthy, that money grows tax-deferred like an IRA, and can amount to a lot of money in retirement.

Every year around this time you should assess your finances and see what you need to do to optimize your situation. Making the most of your HSA is one area that can really make a difference. Here are the key things you need to know to get the greatest tax reduction and the most growth out of your HSA:

Maximizing Your Contribution May Reduce Your Taxes By $1836 or More

If you own an HSA-qualified health insurance plan that has an effective date no later than December 1, 2007, you qualify to make a tax deductible contribution to your Health Savings Account. This will immediately reduce your tax bill come April 15.

The contribution limit is not pro-rated based on the number of months in 2007 in which you had coverage, as it was in the past. However, you do need to remain an HSA-eligible individual throughout 2008, or the extra amount contributed will be counted as income and subject to an additional 10 percent tax.

The maximum HSA contribution in 2007 is $5650 for families, and $2850 for individuals. If you are 55 or older, you may also contribute an additional $800.

Your HSA contribution is deductible on your federal income taxes, and every state (except AL, CA, NJ, and WI) also gives a deduction on state income taxes. So by maximizing their HSA contribution a family in a 28 percent tax bracket, paying 4.5 percent state income taxes, will reduce their April 15 tax burden by $1836.25.

Though your HSA-qualified health insurance must be in place before the end of the year, you do have until April 15 to make your 2007 contribution. Though you cannot put any more 2007 money in if you miss this deadline, you can reimburse yourself in later years for qualified expenses incurred in 2007, even if you do not currently have the money in your account.

Strategic Withdrawals

You can withdraw money from your HSA at any time to pay qualified medical expenses. Keep in mind that this includes over-the-counter medications such as aspirin or cough syrup, dental and vision expenses, and even alternative care such as acupuncture or homeopathy.

One strategy that many of our members take is to save their medical receipts, but to delay reimbursement from the HSA so that the funds have the opportunity to grow tax-deferred. There is no time limit in which you must withdraw the money. Since most people will face larger medical bills during their retirement, it is quite likely that the withdrawals would never be subject to taxes.

If you are not fully funding your Roth, another strategy would be to reimburse yourself for medical expenses from your HSA, and to deposit it in your Roth. Your HSA reimbursement is tax-free, and placing it in your Roth would also give you tax-free growth while enabling you to withdraw the money in retirement tax-free for any reason, including non-medical expenses. You would also avoid any extra state taxes in the states that currently tax HSAs.

Remember to Keep Good Records

You should keep a record of any qualified medical expenses you incur. This will ensure that you have documentation substantiating any tax-free withdrawal you make from your HSA. In order to pay for a medical expense from your HSA, it must be an HSA qualified expense.

You can go low-tech and just put receipts in a file, or get a little more organized and track your records online.

2008 Contribution Limit and Deductible Changes

In 2008 the maximum annual HSA contribution limit will again go up, this time to $2900 for individuals and $5800 for families. Those over age 55 will be allowed to contribute an additional $900 to their accounts.

The maximum deductibles will be going up next year to $5600 for individuals, and $11,200 for families. If you've now got some money socked away in your HSA, it might make sense to move to a higher deductible to further reduce your premiums.

Health Reimbursement Arrangements

If you are currently set up as an S-corp, you should strongly consider setting up a Health Reimbursement Arrangement (HRA). An HRA enables your S-corp to reimburse you as a tax-free fringe benefit for the cost of your individual health insurance. This is the only way an S-corp can legally pay for individual health insurance, and is saving our average S-corp member over $3000. The HRA must be established by December 31st in order to take advantage of it in 2007.

It may also be beneficial to set up an HRA if you have a spouse who works in your business. Also, many small businesses use an HRA to reimburse their employees for individual health insurance premiums (which is much less expensive than getting group coverage). More information and a simple online application is available on our Health Reimbursement Arrangement page.

What to Do Now

Here are the steps you should take now:

1. To maximize the potential growth of your funds, you should try to fund your account as early in the year as possible. Every month of tax-deferred growth does add up over time. You can keep the money in a savings account, or invest it in stocks or mutual funds.

2. If you have your health insurance in place but do not yet have your HSA set up, you can do so online or possibly your local bank.

3. If you do not yet have an HSA-qualified health insurance plan, you should apply for coverage as soon as possible. Your plan must be effective by December 1st in order for you to qualify for the 2007 tax deduction. However, by getting your HSA-qualified health insurance in place by December 31st, you may be able to lock in 2007 rates for the next 12 - 24 months.

4. If you have a small business with employees, are set up as an S-corp, or have a spouse who works in the business with you, you should set up a Health Reimbursement Arrangement.

Through HSAs and HRAs, individuals who pay for their own health insurance have some powerful tax reduction strategies at their disposal.

Posted by Wiley Long at 03:17 PM | Comments (0)

December 06, 2007

Small Businesses and Financial Advisers are Embrace Health Savings Accounts

Small business owners and their financial advisers are finding ways to deal with the rising cost of health insurance, making Health Savings Accounts all the more appealing.

"More clients are becoming warm to that concept," said James J. Holtzman, a certified financial planner and adviser with Legend Financial Advisors Inc. of Pittsburgh. "It just has to be the right kind of situation."

As small-business owners themselves, financial advisers are following their own advice and seeking alternatives to trim health costs.

"I've seen that insurance companies are phasing out the richest benefit plans by escalating premiums to the point that they're no longer affordable," said Keith Newcomb, a financial planner and wealth manager with Full Life Financial LLC of Nashville, Tenn. He runs his practice on his own, with help from his spouse.

"We're looking at switching from a superrich Preferred Provider Organization to a Health Savings Account based model," Mr. Newcomb said.

Fully 63% of Americans with health insurance coverage reported a jump in the costs they had to pay in the previous year, according to the 2007 Health Confidence Survey from the Employee Benefit Research Institute of Washington. Thirty percent of those with higher costs said that they had cut back on retirement contributions, while 52% were reducing their savings.

The problem is serious for small-business owners, who may not have the money for group policies but still have to contend with larger competitors for prospective employees, said Mr. Newcomb.

"I shop their health insurance around, making sure that we get a good rate for our clients," said Mr. Holtzman, who is also a shareholder in his practice. When the time comes to renew their policies, and clients are consulting different insurance companies and comparing coverage, this is also a great time to make sure that the doctors are a good match with the business' needs, he added.

A health insurance broker can help with this part of the process, Mr. Holtzman said.

Consumer-directed health plans usually combine high-deductible plans with Health Savings Accounts or Health Reimbursement Arrangements. Participants think a little more when they go to the doctor and are encouraged to shop around for a better price so as to hold on to or invest the money in the HSA account.

The HSA options also make health costs transparent, as plan participants will talk to their doctors about the prices of procedures and treatments, said Eric Remjeske, president of Devenir Group LLC, a Minneapolis firm that provides HSA investment options.

Mr. Remjeske and his wife shopped around when searching for a hospital before their youngest son's birth. "I got a few quotes on the cost of child delivery, and we went somewhere cheaper," he said. "The key isn't just education on Health Savings Accounts but also the transparency."

Employees are also encouraged to remain in good health to cut back on trips to the doctor. "Internally, you can encourage them to do things that are good for wellness," said Mr. Holtzman. "If you can get them to pick up a gym membership or offer them a discount for the costs, you might save some money in terms of premiums." It's a solution that will play out over the long term, Mr. Holtzman added.

A number of plans are slashing costs for business owners in both ways — by rewarding good health and providing an HSA option. Among them, a plan from The Principal Financial Group Inc. in Des Moines, Iowa, provides covered employees with health risk assessments.

All workers save on deductibles and co-payments during the first three months of coverage. Those who meet a minimum score requirement on the assessment get the savings, while those who fall below that mark have wellness options for getting healthy and qualifying for the savings. HSAs are also accessible through the plan.

Advisers also report that they're saving with consumer-driven plans and HSAs even if their practices are too small for group policies.

"We've had the most success using individual plans for companies with two to five employees," said J. Patrick Collins Jr., a certified financial planner and principal at Greenspring Wealth Management Inc. of Towson, Md. When working with his small-business clients, he compares traditional products such as health-maintenance or preferred-provider organizations with high-deductible plans with HSAs.

Simply by choosing individual policies over group coverage, Mr. Collins has seen his clients save 30% to 40% on plan costs — but this works only if there are no more than five employees and everyone is in good shape. The results have been good enough that he uses the same approach in his practice.

"The people here are young and healthy, so we save a lot of money with an individual policy and an HSA," Mr. Collins added.

Although employers may have to go over the HSA plans with their workers to show them the benefit, educated participants become more engaged in their health and strive to drive costs down for all, Mr. Remjeske observed.

"We're trying to get people to think, 'If I have a runny nose, should I go to the emergency room?'" he noted. "People abuse the system because someone else is paying for the services, but if you're paying for it, you decide what to do."

Posted by Wiley Long at 01:47 PM | Comments (0)

November 25, 2007

Interest in Health Savings Accounts Will Surge in 2008

In late September the Washington, DC-based global consulting firm Watson Wyatt Worldwide identified "more Health Savings Accounts" as a major benefit trend during the open enrollment season, the annual period when employees can adjust the benefits their employers provide.

Employer interest in consumer-directed health plans with Health Savings Accounts (HSAs) continues to grow, according to Watson Wyatt, which predicted 40 percent of U.S. companies will offer workers an HSA in 2008.

In another report issued in late September, Hewitt Associates, a leading provider of human resources outsourcing and consulting services based in Lincolnshire, Illinois, pointed out account-based plan designs are gaining traction among employers as a way to control costs.

According to Hewitt Associates, by the end of this year 20 percent of U.S. companies will be offering or planning to offer high-deductible health plans with Health Savings Accounts, and almost 50 percent of the companies nationwide are considering offering them at a future date.

"While just 3 percent of employees elected these plans last year, most companies anticipate that enrollment will grow to 20 percent in five years," the company noted in a September 24 news release.

Catching On

That shows just how well consumer-directed health care plans are catching on with the public, said Diana Ernst, a health care policy fellow at the Pacific Research Institute in San Francisco.

"Consumer-directed health care is making progress, and it's giving Americans more control of their own health care dollars," Ernst explained. "Recent studies report that some 55 million Americans will purchase their own health care in the next three years, as employers struggle to provide health insurance for workers.

"High-deductible health plans have already grown significantly, by 3.5 million since 2005," Ernst said. "Reports show that this growth has been cost-effective for owners of these health plans, who also seek out the same level, if not more, of preventive health care services."

Ernst said the rise of high-deductible health plans (HDHPs) is likely to continue, caused by "changes in federal tax law that exempt purchasers from federal taxation on their accounts.

Red Tape

Ernst said HDHPs paired with HSAs "are good for all Americans" because "they allow Americans to save money in their accounts over an entire lifetime, tax-free."

However, Twila Brase, president of the Citizens' Council on Health Care, said the insurance connection impedes effectiveness.

"The HSA should be detached from high-deductible policies," Brase said. "The expense must still be run through the health plan to determine how much the doctor will be paid. Thus, doctors cannot cut the red tape and most of the administrative costs associated with it."

Brase warned against the potential of government forcing individuals to purchase Health Savings Accounts along with other types of insurance.

"Universal health care can come in various sizes and packages," Brase explained. "While Health Savings Accounts will hopefully begin to bring price sensitivity to patients, that is no guarantee against universal health care and its government-run model. A mandate on individuals to buy insurance, including Health Savings Accounts, would still lead away from markets and toward an ever-growing central health care bureaucracy."

Posted by Wiley Long at 10:39 AM | Comments (0)

November 15, 2007

Health Savings Accounts Making Quiet Progress

As presidential candidates unveil their health reform proposals and as Congress debates expansion of government programs, companies around the country are quietly finding their own ways to manage health costs.

The latest evidence comes from a new study by CIGNA which shows that first year medical costs trended 12% lower for its consumer-directed health plans (CDHPs), such as Health Savings Accounts (HSAs) and Health Reimbursement Arrangements (HRAs), compared to its HMOs and PPOs.

In addition, the expenses paid directly by members in Cigna’s CDHPs were similar to traditional plans in the first year and 4% lower in the second year, refuting criticisms that consumer-directed plans shift costs to consumers. In addition, the two-year survey found that use of preventive care increased, CDHP members continued to receive recommended care at rates similar to traditional plan members, and medication compliance, especially for those with chronic conditions, improved.

Helen Darling, president of the National Business Group on Health, said, "As we debate in earnest, at national and state levels, how to provide insurance for millions of people without protection, consumer-driven plans have to be at the top of the list of reasonable solutions."

And there is more: HealthPartners, a Minnesota-based health plan, released results of a study it conducted that also shows members who have Health Savings Accounts and Health Reimbursement Arrangements have lower medical costs and are more engaged in seeking out more cost-effective care.

The analysis shows that even when adjusted for illness burden, health care costs were 4.4 percent lower for HealthPartners members in these consumer directed health plans compared to members in traditional plans. Researchers found the lower costs were driven by CDHP members receiving care from lower cost providers and that providers used fewer resources such as diagnostic imaging and other procedures.

Both companies say that the cost-saving results have encouraged more employers to offer HSAs and HRAs in the upcoming 2008 open season, which begins in a few weeks.

Posted by Wiley Long at 01:58 PM | Comments (1)

October 29, 2007

Health Savings Account Consumers Could Be Saving on Health Costs

Results from a study released by HealthPartners shows that people using Health Savings Accounts and Health Reimbursement Accounts could be saving significant money on medical costs.

The company's findings indicate health care costs were 4.4 percent lower for members who used consumer directed health plans (CDHP), even after adjusting for differences in members' health status.

The study also found that CDHP members were significantly healthier and were expected to use 28 percent fewer health care services than those enrolled in traditional plans. CDHP members were also younger.

"We also wanted to know how CDHPs impact members to get proper health care," said Andrea Walsh, executive vice president of HealthPartners. "It turned out people were getting preventative visits, taking their medicine and getting treatment for illnesses such as diabetes."

The study compared 140,000 continuously enrolled members in traditional health plans with 5,000 members in account-based plans such as Health Savings Accounts and Health Reimbursement Arrangements.

Participants of CDHPs were also more likely to use HealthPartners' Web site to calculate medical costs, compare quality care information and search lists of facilities that offer the most cost effective services for various procedures.

Eileen Smith, communications director at the Minnesota Council on Health Plans, said studies looking at CDHP provide a short-term glimpse at the product because people just recently started using the plans. But it is important, she said, because more employers are offering it and employees are choosing CDHPs over traditional health plans. According to its 2006 annual industry overview, 243,205 people in Minnesota who are insured through the council's members used health savings and health reimbursement accounts, compared with only 85,960 in 2004.

"Employers are scrambling to keep coverage for employees and for some [health savings and health reimbursement accounts] is the best option," Smith said.

Learn more about Health Savings Accounts at: http://www.health--savings--accounts.com

Posted by Wiley Long at 07:34 AM | Comments (0)

October 18, 2007

Health Savings Accounts Create More Choice

According to John Goodman, president of the National Center for Policy Analysis, health insurance is an institutionalized, bureaucratized market that is heavily influenced by tradition and the fact that normal market forces have been suppressed, and we agree.

One thing that would help loosen things up is to liberalize the laws for Health Savings Accounts (HSAs):

- Currently, HSAs are limited to people with high-deductible policies; but if they were widely available, they would confer more choices -- and more consumer buying power.

- For example, a person slated for a $50,000 surgical procedure may want to have it done in a different city even if it costs more.

- If the patient had money saved in an HSA, it would provide more flexibility; once millions of people began using HSAs, doctors won't think it's so odd to be asked for prices.

Health insurance that allows patients to pick providers would also help lower costs in chronic care, which generates the highest costs in health care, says Goodman. Currently, insurance pays by task and care is fragmented. A diabetic, for example, must visit many different providers. Once a real market comes into existence, patients would be able to shop around. Full-service diabetic centers would compete for business.

Learn more about Health Savings Accounts at: http://health--savings--accounts.com

Posted by Wiley Long at 10:35 AM | Comments (0)

October 10, 2007

As Premium Costs Rise Health Savings Account Plans Gain Popularity

About half of all employers are expected to soon offer Health Savings Account (HSA) plans to their employees. This projection offers the best hope for restraining runaway health care costs, according to John Goodman, president of the National Center for Policy Analysis (NCPA).

"The best way to control health care costs is to put patients in control of more of their health care dollars," said Goodman. "The increasing popularity of Health Savings Accounts is a result of managed care's failure."

According to a report recently released by Hewitt and Associates, a global human resources company, "account-based plans are gaining traction by employers as a way to control costs." Hewitt's research found that more than 20 percent of companies offer, or plan to offer, a high-deductible health plan with a Health Savings Account by the end of this year and almost half are considering offering one at a future date. While just 3 percent of employees elected these plans last year, most companies anticipate that enrollment will grow to 20 percent in 5 years.

A major factor in the movement towards HSA plans is the ever-increasing premium rates. While employers enjoyed a nine-year low in health care cost rate increases this year -- a 5.3 percent average increase, down from 7.9 percent in 2006 -- that is expected to change in 2008. Premiums are expected to rise by an average of 8.7 percent in 2008. For example:

-- Premiums for traditional indemnity plans increased 9.1 percent in 2007 and are expected to increase 9.0 percent in 2008;

-- Premiums for HMOs increased 8.7 percent in 2007 and are expected to increase 9.0 in 2008;

-- Premiums for point-of-service (POS) plans increased 3.9 percent in 2007 and are expected to increase 8.5 percent in 2008;

-- Premiums for preferred provider organizations (PPOs) increased 2.4 percent in 2007 and are expected to increase 8.5 percent in 2008.

"While the movement towards HSA plans is encouraging, the real issue is much deeper than putting patients in the driver's seat," said Goodman. "We are suffering today because we systematically suppressed the market in every aspect of medical care for more than 100 years. The solution is long overdue: bring the market back to life."

Learn more about how Health Savings Accounts can help solve our healthcare crisis at: http://www.health--savings--accounts.com

Posted by Wiley Long at 07:21 AM | Comments (0)

October 01, 2007

Disputing Hospital Bills Paid with Your Health Savings Account

If you run into a billing problem or misunderstanding with a hospital or doctors office for which you're planning to use money from your Health Savings Account, you could have some extra work to do.

If you have a Health Savings Account, you must have a high deductible health insurance plan. If you are using money from your Health Savings Account to pay a medical bill, it means that you have not hit the deductible of your policy yet.

What does this mean to you when you run into a billing dispute?

Insurance companies have a comprehensive system for dealing with billing disputes when they have covered a hospital stay or doctor visit. But when they haven't covered it because you are still within your deductible, that comprehensive dispute resolution system doesn't necessarily apply.

Here are some points to keep in mind when you are dealing with a hospital in a billing dispute, and you have paid with Health Savings Account money. These important points come from an expert in this field named Dr. Vincent Riccardi, who is the owner of American Medical Consumer (www.medconsumer.com), a company dedicated to helping people resolve billing disputes with hospitals and doctors.

Heres what Dr. Riccardi has to say:

1. First, discuss the issue with your physician. Sometimes the problem stems from an incorrectly applied billing code and the doctor can easily change it to please the hospital and resolve the problem on the spot.

2. Negotiate in person. Especially if you just dont have the money to pay a bill, it makes the best sense to negotiate face-to-face with the person at the hospital who has the authority to reverse or reduce the charges. Hospitals would often rather be paid part of a bill than risk losing the entire bill. Be honest and forthright and you may have a good chance in negotiating a reduced fee from the hospital. This includes the situations where it was a misunderstanding on your part. Its at least worth a try.

3. Dont bother going to the State Medical Board. In most cases, they are not able to help you. This is the case with most government agencies. Even the Departments of Insurance cannot help, because this isnt an insurance problem, it is technically a fee-for-service situation.

4. Recourse to a lawyer is usually not fruitful unless there is a big amount involved. For amounts less than $5,000 (which is what most HSA-style deductibles are), a lawyer probably wont be able to help you.

5. Remember that the only things that count in negotiations like this are the things that have been written down. If a doctor mentioned something to you but didnt write it down, it probably wont help you. Get things in writing all the way through the process.

I think of Health Savings Accounts as a way to be your own insurance company for the small stuff (under your deductible). That is its power. But it also means that when it comes to disputes, you also have to be your own insurance company and take charge of the negotiations with the hospital, just like an insurance company would. Your willingness and ability to negotiate will influence your ability to get unfair charges reversed or, at least, lessened. But its a do it yourself situation, so be aware of that when you sign up for an HSA.

Learn more at: http://www.health--savings--accounts.com

Posted by Wiley Long at 07:43 AM | Comments (0)

September 27, 2007

The Difference Between a Health Savings Account and Traditional Health Insurance

Consumers frequently inquire about the difference between these plans. Most understand the basics of traditional health insurance, but many do not understand the nuances of a Health Savings Account (HSA).

So exactly what is a Health Savings Account?

The easiest way to explain the difference may be to clarify what Health Savings Accounts are not. They are not health insurance plans. Rather, they operate much like savings accounts setup at a bank. And they are always coupled with a High Deductible Health Insurance Plan.

That is to say, one could purchase high deductible health insurance coverage with or without a Health Savings Account attached to the plan. A Health Savings Account is exactly that, an account established to save money for future health expenses.

The idea behind Health Savings Accounts is fairly straightforward. Owners deposit funds into their accounts to be used later for qualified health expenses. Funds can be used for a variety of expenses including (but not limited to) visits to the doctor, prescriptions and/or meeting the deductible.

Advantages of HSA Compatible Plans

Generally, Health Savings Accounts will be less expensive than traditional insurance plans. The reason is simply that plan deductibles are higher. Therefore, the insurance company underwriting the plan will not have to immediately cover small, incidental claims. The owner would use funds from the HSA for many of the incidentals - like doctor visits, prescriptions, etc.

In addition, the attached savings account has significant tax advantages versus traditional health plans. Contributions into an HSA are tax deferred and the interest accumulates tax deferred much like contributions to an IRA. However, when funds are withdrawn for qualified medical expenses, no taxes are due on those withdrawals. In this way, HSAs provide tax advantages to the consumer twice once when the money is deposited and again when it is withdrawn.

Who Should Consider a HSA Compatible Plan?

Healthy individuals who infrequently visit the doctor are good candidates. Individuals and families on a tight budget, but in need of affordable coverage could also consider a HSA plan. These consumers can pay smaller, minor health costs out of the HSA, but should they have a significant claim, the health insurance coupled with the plan is available once the deductible has been met.

Many employer sponsored group plans are already switching to HSAs to lower their health care premium bills. The rising cost of health care is forcing many companies and small business groups to change insurance plans in order to save money. A HSA compatible plan can be a fair compromise for the employee and the employer. Some employer groups will make contributions to the HSA to encourage employees to make the change.

Who Should Consider Traditional Insurance?

Consumers who want lower deductibles and more in immediate benefits tend to purchase traditional plans. In the insurance industry, this concept is called first dollar benefit. These are benefits the consumer receives without having to meet a deductible or co-insurance provisions. Examples of first dollar benefits include annual physicals, visits to a specialist or non-specialist, OBGYN visits and prescription coverage. While newer HSA plans are offering more in first dollar benefits, usually traditional health insurance will provide the most in immediate benefits.

Traditional coverage can be more advantageous for families and/or middle aged or older consumers. These groups may be more likely to have several claims against their policies. They may desire more in immediate benefits. Additionally, they may simply have the resources available to afford more expensive policies.

In summary, there are many health insurance plans available to the individual, family and business group. Choosing the right plan will often times involve balancing cost with benefits. HSA compatible plans can be an affordable alternative to a traditional, lower deductible plan. Consumers, when working with an experienced independent agent, can usually find a suitable plan that fits their needs.

Posted by Wiley Long at 09:14 AM | Comments (0)

September 12, 2007

Doctors Helping Health Savings Account Owners with No-Interest Loans

With Health Savings Accounts continuing to grow, doctors are starting to realize the opportunities available to them when it comes to Health Savings Account owners.

Zero-interest financing, a familiar sales incentive at car dealerships and furniture stores, has found its way to another big-ticket consumer market: doctors' and dentists' offices.

This is another step in the right direction for individuals and families who own a Health Savings Account.

For $3,500 laser eye surgery, $6,000 ceramic tooth implants or other procedures not typically covered by insurance, millions of consumers have arranged financing through more than 100,000 doctors and dentists that offer a year or more of interest-free monthly payments.

Of course, going into debt to pay for medical procedures is nothing new for many people. And this type of financing is still only a fraction of the nation’s $900 billion market for consumer revolving credit.

But as the price of health care continues to rise and big lenders pursue new areas for growth, this type of medical financing has become one of the fastest-growing parts of consumer credit, led by lending giants like Capital One and Citigroup and the CareCredit unit of General Electric.

Big insurers, too, are devising new financing plans with various payback options. Upstart players have also aggressively cut deals with doctors.

The room for expansion looks ample, as rising deductibles, co-payments and other costs may force more of the nation’s 250 million people with health insurance to finance out-of-pocket expenses for even basic medical care.

“As more and more of the costs of care are shifted to consumers, people are going to need more credit,” said Red Gillen, a senior analyst at Celent, an insurance and banking research firm. “They are still going to need health care.”

The zero-interest plans are not for everyone. In fact, they are available only to the creditworthy — meaning they offer no help to those among the nation’s 47 million uninsured who are in difficult financial situations.

And creditworthiness is starting to be judged even more stringently, in light of the subprime mortgage crisis’s impact on the debt markets, according to David Robertson, publisher of The Nilson Report, a newsletter for the credit card industry.

Even for those who can get credit approval, the plans make sense only if users are able to make payments on time and close the loan on schedule, typically within 12 months. Otherwise, the loans after defaults can carry interest rates of 20 percent or more — similar to the default penalty on a typical credit card.

“We are very careful to tell patients upfront, ‘Be sure you can make your payments,’ ” said Dr. Richard J. Mercurio, a dentist in Lincroft, N.J. He arranges patient financing through the CareCredit unit of G.E., the leader in consumer medical financing.

Dr. Mercurio says he knows of at least two patients who missed payments and received monthly bills charging high interest rates. “They were not happy,” he said.

For those who are able to make their payments, though, the plans can make it possible to receive treatments that otherwise might be out of reach.

“There was no way I had $6,000 right out of my pocket,” said Nancy Schlachter, 40, who has dental insurance through her job as an accounts payable manager for a national construction company. She went to Dr. Mercurio for a series of dental procedures including a new crown, fillings and a tooth implant.

“The implant was very expensive, and it was not covered,” Ms. Schlachter said. But the dentist’s office arranged 12-month zero-interest financing. “It was the only way I could do it,” she said.

Some consumer debt experts warn that as more people try to bridge widening gaps in their health insurance, paying for medical care on credit could plunge the unwary into a financial crisis. In recent years, the use of high-interest credit cards to pay big medical bills has become a leading cause of consumer bankruptcy.

“Unless they are at risk of losing life or limb, people should be very cautious about putting medical bills on credit cards,” said Mark Rukavina, executive director of the Access Project, a research and consumer advocacy organization that helps people with their medical debts.

Still, consumer credit companies and some insurers are now experimenting with financing plans meant specifically for medical costs.

For people who think they could not pay off a zero-interest loan within a year, most credit companies also offer longer-term medical financing deals with 12 percent to 13 percent interest payable over several years. Those plans, though, must be arranged at the outset of the medical expense; a zero-interest plan typically cannot be converted to the longer-term program if consumers find themselves unable to pay off the one-year loans.

Some insurers, including United Healthcare, also have special credit plans available for insured members whose policies are linked to Health Savings Accounts. Such policies combine high-deductible insurance with tax-sheltered savings accounts where money can roll over year to year until needed for medical expenses. But typically, the amounts of money being set aside do not go very far toward meeting even routine health expenses.

So far, among the 1.76 million Health Savings Accounts in this country, the average balance is $1,327, according to a recent survey by Inside Consumer-Directed Care, a trade publication. To help people with Health Savings Accounts meet the shortfall, the Exante Bank unit of United Healthcare is trying out a card that extends credit at rates currently averaging about 10 percent to 13 percent, depending on the applicant’s credit history.

United Healthcare is also testing a medical credit card that would offer reduced rates.

“There’s a place for credit solutions that are integrated within traditional health insurance programs, when an individual hits that out-of-pocket expense,” said Tom Beauregard, a senior vice president at United Healthcare. “The key is to make it voluntary, to make it simple and to offer favorable credit terms.”

As for the zero-interest deals, the credit providers say that most of them end up being just that — interest-free. About 80 percent of the medical loans that CareCredit provides are paid off on schedule and incur no finance charges, according to the company’s president, Michael J. Testa.

That, the companies say, justifies the high default interest rates for late payments, since that is the way they recoup the costs of doing business. In fact, though, the credit companies make money even on the interest-free deals, because they are typically keeping 10 percent of the fee the doctor charges the patient. On a $5,000 cosmetic nose operation, for instance, the plastic surgeon might receive only $4,500.

Another of the medical finance companies, HELPcard, says that for dentists whose customers are good credit risks, the lender’s commission might be only 4 percent to 5 percent. But for patients with low credit ratings, a dentist eager to build a clientele might have to accept as little as 75 percent of the bill, said Pat McGee, HELPcard’s senior vice president for sales and marketing.

The CareCredit unit of G.E., too, has special deals for patients whose credit is not well established. Stephanie Waterman, a coordinator for Dello Russo Laser Vision, a laser-surgery practice with offices in New York and Bergenfield, N.J., said patients deemed less creditworthy were required to pay $600 in cash and to agree to have 12 months of zero-interest payments taken directly from their bank accounts.

One Dello Russo patient, Senior Airman Derrick Fields, 31, stationed at Dover Air Force Base in Delaware, said that in June he paid $600 down on a $3,500 surgery bill for both eyes — a reduced charge the practice offers to members of the military.

“They take about $250 a month from my bank account,” said Mr. Fields, who said he soon expected to not wear eyeglasses for the first time since the second grade. “I owe $2,900.”

Learn more about what a Health Savings Account can do for you at: http://www.health--savings--accounts.com

Posted by Wiley Long at 07:19 AM | Comments (0)

August 22, 2007

Communication and Information Tools Critical to Health Savings Account Success

According to a new study conducted jointly by Watson Wyatt Worldwide, a leading global consulting firm, and the RAND Corporation, a non-profit research organization, most employers that offer Health Savings Account plans say communicating with workers about these plans is their greatest challenge. Additionally, most employers are not pleased with the availability of information on provider cost and quality.

Nearly all of the respondents - 90 percent - cited employee communication as their greatest challenge when introducing Health Savings Accounts and during the plan's first year.

Employers, on average, began communicating information about the new plan to workers four months prior to open enrollment. The study was based on 42 large employers that offer a Health Savings Account to their workers.

“The ‘consumer-driven’ part of consumer-driven health plans means that workers need to be engaged, and that can’t happen without effective communication,” said Ted Nussbaum, North America health care practice director at Watson Wyatt. “These plans are different from those that most employees previously had, and it’s not a simple task to encourage employees to carefully review their options and learn how consumer-directed plans work.”

Employers concur that getting employees to enroll in these plans can be difficult when they also have more traditional health plan options. The study found that employers were most likely to achieve high levels of Consumer Driven Health Plan (CDHP) enrollment when they devoted additional time and resources to communication, forced employees to make an active choice at open enrollment and offered financial incentives in ways that enhanced the appeal of the CDHP.

Another challenge that employers face when offering a CDHP is providing workers with information they need to help make good decisions about health care cost and quality. The study found that employers are generally pleased with Web-based, out-of-pocket cost calculators for employees. However, they find that specific resources needed to help workers evaluate the cost and quality of care from specific providers are often lacking. Just 2 percent rated cost information about health care providers as excellent, and 5 percent rated it as good. Only 10 percent rated information on the quality of care as good; none rated it as excellent.

“Provider cost and quality tools that help employees make smart, cost-effective decisions need to be part of the consumer-directed health plan package.” said Melinda Beeuwkes Buntin, co-director of RAND’s Bing Center for Health Economics and co-author of the study. “Better information tools would promote employee engagement and help workers select the health plan that is best for them.”

“Employers have high expectations for CDHPs,” said Roland McDevitt, director of health research at Watson Wyatt and co-author of the study. “While their early experiences are favorable, the success of the plans will ultimately hinge on whether employers can provide employees with decision support tools that will empower them as engaged consumers.”

The multi-year study is jointly funded by the California HealthCare Foundation and the Robert Wood Johnson Foundation. The RAND Corporation is the lead organization, with Watson Wyatt serving as a research partner. Copies of the research brief, “The CDHP Implementation Experience with Large Employers,” are available at: http://www.watsonwyatt.com/cdhp

Posted by Wiley Long at 10:58 AM | Comments (1)

August 13, 2007

Publix Helping Health Savings Account Owners

Publix Supermarkets is launching a new free prescription drug program offering seven popular antibiotics at no charge for people with valid prescriptions. Since this would be an out of pocket expense, Health Savings Account owners stand to benefit the most.

The free antibiotics are available to customers regardless of their heath care coverage and are provided in up to two-week supplies.

Publix estimates that the antibiotics account for almost 50 percent of generic, pediatric prescriptions filled at the supermarkets' pharmacies.

The prescription antibiotics available under the program include:

Amoxicillin
Cephalexin
Sulfamethoxazole/Trimethoprim (SMZ-TMP)
Ciprofloxacin (excluding ciprofloxacin XR)
Penicillin VK
Ampicillin
Erythromycin (excluding Ery-Tab)

“At Publix, we’re working hard to develop a complete health and wellness program,” said Charlie Jenkins Jr., chief executive officer of Publix Supermarkets. “From the nutrition information in our stores to the services in our pharmacies, Publix is committed to the health and wellness of our customers. I'm pleased that we can make this program available and use it to further serve the needs of our customers and their families.”

Learn more about Health Savings Accounts and what they can do for you at: http://www.health--savings--accounts.com

Posted by Wiley Long at 11:13 AM | Comments (0)

July 27, 2007

Health Savings Accounts Leading the Way in Consumer-Driven Popularity

The following are results from Culpepper Benefits Trends Survey on Consumer-Driven Health Plans (CDHPs) offered to U.S. employees in IT, technology, and life science organizations. Results include information on Health Savings Accounts (HSAs), High-Deductible Health Plans (HDHPs) used in conjunction with Health Savings Accounts, and Health Reimbursement Arrangements (HRAs).

Companies are reporting a strong interest in both Health Savings Accounts and Health Reimbursement Arrangements.

Thirty-eight percent of respondents currently offer a High Deductible Health Plans with a Health Savings Account. Another 15 percent plan to offer them within the next two years. Health Reimbursement Arrangements, tax-free plans exclusively funded by employers to be used before any traditional health care coverage, are offered by 19 percent of respondents. Another 28 percent are considering them and six percent plan to offer them within the next two years.

Health Savings Accounts (HSAs)

Health Savings Accounts are more common than Health Reimbursement Arrangements , with 38 percent of participating companies currently offering them. Forty-six percent of companies plan to offer Health Savings Accounts within the next two years or are currently considering the option.

Health Savings Account Enrollment

Enrollment eligibility is high, with companies offering enrollment to an average of 96 percent of employees. However, only 42% of eligible employees participate.

Company Contribution to Health Savings Accounts

Companies most often contribute a flat amount per year to employee Health Savings Accounts. Flat amount per-person contributions average $853 per year, while per-family contributions average $1,528.

Factors Influencing the Decision to Not Offer Health Savings Accounts

Seventeen percent of participating companies have no plans to offer Health Savings Accounts to employees. Concerns over the additional education required to offer Health Savings Accounts and potential employee relations issues are among factors which influence the decision to offer Health Savings Accounts.

You can view the entire results of the survey here: http://www.culpepper.com:80/ebulletin/2007/JulyBenefitsTrends.asp

Posted by Wiley Long at 10:38 AM | Comments (0)

June 24, 2007

Study Shows Health Savings Account Penetration Reaches 5%

According to a study by Information Strategies, Inc. (ISI), Health Savings Accounts have had varying levels of adoption when taken on a state-by-state basis but are approaching 5% of all healthcare insurance users on a nation-wide basis.

The company's analysts reviewed data from all 50 states, surveys this year of more then 5,000 healthcare insurance users, reports from 2,900 firms and other information sources.

Among the states with the highest Health Savings Account penetration, 5-7% were Wisconsin, Texas, Georgia, Florida, Illinois, Ohio, Tennessee and Kentucky.

Amongst the lowest with penetration levels below 2% are New York, New Jersey, Rhode Island, Hawaii and Vermont.

“Clearly, there are states that have welcomed Health Savings Accounts and others that are still fighting consumer directed healthcare offerings,” said JoAnn Laing, ISI’s President & CEO.

“We made our estimates based on research with individuals and firms offering Health Savings Accounts as well as thousands of respondents to our ongoing surveys, more than 22,000 who have answered questionnaires or participated in focus groups since the inception of Health Savings Accounts,” she added.

“In some states, the regulatory bodies have made it easier to offer Health Savings Accounts while in others, such as New Jersey, the insurance commission has not moved as quickly,” she added.

Laing also reported that some insurance providers have shared their data with ISI and others have not.

Posted by Wiley Long at 11:02 AM | Comments (0)

June 12, 2007

Health Savings Accounts for Retirement

Not to long ago, we experienced the shifting of responsibility for retirement savings from the employer to the employee. This shift was accomplished by employer implementation of the now common 401(k) plan. Those of us who take advantage of 401(k) plans appreciate the role the plans play in our ability to retire.

We are now in the midst of a similar shift of primary responsibility in providing for our family's health care. This shift makes use of a Health Savings Account. Even the mechanics are similar.

A Health Savings Account provides for an opportunity to save. The employee has the option, but not the legal obligation, to contribute to their Health Savings Account. Amounts contributed to a Health Savings Account are portable meaning that employees can take the account if they change jobs.

HSA rules have been simplified effective for 2007. The contribution amount is no longer linked to the deductible of the related health insurance plan. Instead, the deductible amounts are fixed so long as the related insurance plan qualifies as a high-deductible health plan. Now, the contribution limit is either $2,850 for an individual with self-only coverage or $5,650 for an individual with family coverage.

Note that individuals who are covered by an eligible health insurance plan can make contributions up to the limits listed above. The amounts contributed may, but are not required to, be used to pay or reimburse out-of-pocket medical expenses. Amounts that are not used to reimburse health costs can remain in the account and earn interest until such time as more significant expenses are incurred.

You might be thinking that this only benefits those who can afford to save amounts in excess of current now-reimbursed health care costs. Hardly. Any employee can use an HSA to convert non-deductible out-of-pocket costs to "pre-tax," or deductible, status.

Assume that Average Joe qualifies to participate in an HSA. Average Joe has a wife and a baby. Between the three of them, they spend $3,000 on health, dental and vision care, excluding insurance premiums. Joe can make deductible contributions to his HSA and then take distributions to reimburse for the family's qualifying costs. Or Joe can not participate in the plan and pay the same costs with after-tax dollars. The difference is that Average Joe will pay about $750 more in taxes if his combined state and federal tax rate is 20 percent and he fails to take advantage of the HSA.

Recent law changes mean that individuals can make a once-in-a-lifetime tax-free rollover from an Individual Retirement Account to an HSA. This could mean substantial tax savings, since distributions from the IRA will normally be fully taxable while distributions from the HSA will not be taxable provided they represent payments or reimbursements for health care costs.

Learn more about HSAs at: http://www.health--savings--accounts.com

Posted by Wiley Long at 10:16 AM | Comments (4)

June 04, 2007

Employers Expand Health Savings Account Options

A recent survey in Colorado and Wyoming shows the number of employers offering Health Savings Account plans rose sharply during the past year.

A poll of 634 companies in Colorado and Wyoming by the Mountain States Employers Council shows momentum building for the addition of Health Savings Accounts, Health Reimbursement Accounts and other such "consumer driven" health plans to their benefit menus.

The current-year survey shows 52 percent of employers either offering or considering consumer-driven plans, compared with 42 percent in 2006.

"Our 2006 Health and Welfare Plans survey revealed this growing interest in consumer-directed health plans by both employers and their employees," council President and CEO Michael Severns said in a statement announcing the findings. "Our 2007 survey clearly demonstrates this trend is continuing."

Results of the new survey, released May 18, show the number of employers offering Health Savings Accounts more than doubling during the year, from 7 percent to 15 percent.

The survey also tracked, for the first time in its 60-year history, the total number of employees enrolled in employer-offered health plans, finding that 84 percent were participating.

Among the 48 Northern Colorado employers participating in the survey, 15 percent were already offering Health Savings Accounts or Health Reimbursement Accounts. Still, the vast majority, 92 percent, relied on preferred-provider organization, or PPO, health-care plans.

The survey also measured the growth in employers' cost of providing health-care coverage, finding that the rate of increase had stayed at 11 percent for the third consecutive year. That rate is half the 22 percent growth rate posted in 2002. The poll showed employers, on average, paid for 85 percent of the employee-only plan coverage and 67 percent of coverage for family plans.

Learn more about how a Health Savings Account can benefit you at: http://www.health--savings--accounts.com

Posted by Wiley Long at 10:27 AM | Comments (0)

May 22, 2007

Mintel Report Predicts Health Savings Account Enrollees to Rise to 30 Million by 2009

According to a new report from Mintel, Health savings accounts are positioned for aggressive growth over the next three years. The report predicts the number of HSA enrollees will increase to 30 million by the end of 2009. The research firm's exclusive survey revealed that only one third of respondents would not be interested in an HSA, indicating substantial potential for increasing enrollment through consumer education. Of the respondents, 13 percent say that they currently have a HSA through their employer.

The Mintel report cites the opportunity for aggressive marketing to expand awareness and growth of Health Savings Accounts.

One feature of Health Savings Accounts that is particularly attractive to consumers is the opportunity for pre-tax savings. According to Mintel’s survey, close to one in four respondents cite this as a key advantage of Health Savings Accounts. This indicates that companies should focus on highlighting this key advantage point in their marketing messages, as well as clearly communicate the other benefits of the product.

However, consumers are having some difficulty with understanding how HSA accounts work. Mintel’s research reveals that close to a quarter of respondents “don’t know” if they would want this type of account. This indicates that, despite a detailed explanation of Health Savings Accounts in the consumer survey question, many consumers either know little about them or have not made up their mind about the product. The majority of consumers who say they “don’t know” fall in the 18-34 age range, with more than a third of this group stating this response.

“Consumers are still uneducated about Health Savings Accounts and their benefits,” said Susan Menke, senior financial services analyst for Mintel. “Employees are generally given information about their benefits options at enrollment, but on a very limited basis thereafter. On an ongoing basis, many employees must get information by proactively visiting Web sites or requesting print materials. HSA providers, as well as employers, can benefit from more continuous and aggressive educational efforts.”

HSA direct-to-consumer marketing efforts are increasing, but they still have room for growth. According to Mintel Comperemedia, a competitive intelligence service that analyzes direct mail, email marketing, and print media, less than 8.1 million HSA direct mail pieces were sent directly to consumers last year. However, there was an 89 percent jump in HSA mail volume, comparing first quarter 2007 to first quarter 2006. Two top companies that promoted Health Savings Accounts by direct mail to consumers were Aetna and Blue Cross of California. Humana was one of the top companies that communicated with consumers via email.

While larger banks are working with insurance companies to set up HSA arrangements, some smaller companies, such as local credit unions, are providing in-branch information on HSA accounts. In the consumer email marketing realm, Mintel Comperemedia observed that several campaigns mentioned HSAs along with other products and services.

“Insurance companies have the opportunity to more clearly explain the advantages of Health Savings Accounts directly to consumers through a number of channels,” Menke said. “For instance, companies can better educate consumers through more aggressive direct marketing and email marketing campaigns. There are many healthcare options available, and HSA marketing messages will need to be simple and direct in order to effectively reach consumers and increase growth.”

About Mintel

Mintel is a leading global supplier of consumer, product and media intelligence. For more than 35 years, Mintel has provided insight into key worldwide trends, offering unique data that directly impacts client success. With offices in Chicago, London, Belfast and Sydney, Mintel has forged a unique reputation as a world-renowned business brand. For more information on Mintel, please visit www.mintel.com.

Posted by Wiley Long at 10:22 AM | Comments (3)

May 13, 2007

Wal-Mart Helping Health Savings Account Owners

Wal-Mart's advance into health care is a testament to private-sector industriousness. While others whine about America's health care "crisis," and back monstrous government programs to solve it, Wal-Mart is actually making care more affordable, says Investor's Business Daily (IBD).

By providing in-store clinics and discount prescription drugs, Health Savings Account owners can take advantage of Wal-Mart's low cost health care.

Consider the retailer's record:

- Already, Wal-Mart has brought low-cost health care by selling 30-day supplies of more than 300 generic prescription drugs at some stores for $4.

- Almost a third of those $4 prescriptions are bought by the uninsured.

- Customers have saved $290 million through the program just since September.

Now, they've gone even further, says IBD:

The company has announced that it will open as many as 400 in-store medical clinics in the next two to three years.

By 2014, it said, clinics could be in as many as half its 4,000 stores.

The clinics will be operated by local hospitals or other independent professionals, and will particularly help the poor, mirroring the low prices in Wal-Mart stores.

Cynics will say clinics and low-price drugs are a ploy to lure more shoppers into Wal-Mart, says IBD. Is that wrong? The essential truth missing from their tirades about Wal-Mart's rapacity is that it's a company, not a charity. It must make a profit to stay in business, provide jobs and keep prices low.

Opening clinics also will likely create new enemies who fear that their practices will be harmed by the presence of price-cutting Wal-Mart clinics in their communities, says IBD. But the issue shouldn't be about saving local medical practices any more than saving local retailers who always complain when Wal-Mart moves in. It should be about quality health care -- and prescriptions, groceries, clothing and essential household items -- at prices all Americans can afford. Wal-Mart does that.

Wal-Mart's health care services only stand to benefit Health Savings Account owners. Visit http://www.health--savings--accounts.com and find out what an HSA can do for you.

Posted by Wiley Long at 03:11 PM | Comments (0)

April 16, 2007

Health Savings Accounts are a Perfect Fit for the Self-Employed

While Americans and the medical community have been a little slow to take up the idea of a Health Savings Account, or HSA, as a way to control medical costs, flexibility and tax-friendly changes to how HSAs work are getting people's attention.

There are about 10 million people enrolled in "consumer-driven health plans," and about 6 million of those are Health Savings Accounts. The U.S. Treasury Department estimates that 25 million to 30 million people will be enrolled in an HSA by 2010. And while many americans are enrolled in an HSA, self-employed individuals are finding them a perfect fit.

Music-store owner Scott Hillje was concerned for his 11-year-old son last year when he fell at the school playground and was taken by ambulance to the hospital. Unlike many self-employed people, Hillje wasn't worrying about how he was going to pay the medical bills.

Every month, $500 is automatically deducted from Hillje's account to go to HSA Bank. From that account, he pays for qualified medical expenses, while the remainder awaits spending on future medical needs and grows from year to year if there is anything left at the end of the year.

Laws passed late last year allow an individual to contribute up to $2,850 a year to an HSA and to allow a family to contribute up to $5,650

Although that's up only slightly from last year's allowance of $2,700 per individual and $5,450 per family, it comes with the advantage of being fully tax-deductible. In previous years, only the amount of the health plan deductible could be written off.

Deposits can be spread out throughout the year, but taxpayers also can take advantage of fully funding an HSA before April 17 for a break on their 2006 taxes.

"I think Health Savings Accounts are the greatest thing since sliced bread," said insurance broker Kevin Cooley of San Antonio's Integrated Health Plans. "Most clients who are open to the HSA idea are self-employed, and they have a different view on money."

That view is one of watching every dollar and weighing options more carefully than workers with company-provided health benefits, low co-payments and a low deductible.

HSAs mean more out-of-pocket expenses than traditional insurance because of the high deductible; but for those without coverage, putting any amount toward tax-free health savings "is still better than no coverage," Cooley said.

A family health plan in San Antonio with a $1,500 deductible and 20 percent co-payments to health providers would cost $1,020.69 a month, under one illustration Cooley provided. That can be a tough nut to crack every month for most families.

But with a Health Savings Account and a higher deductible of $5,650, the same family would pay $322 a month in premiums and any money not spent out of the HSA would roll over into the next year.

Managing those savings also is becoming more sophisticated.

United Healthcare's Golden Rule Insurance Co., one of the pioneers in the HSA field, recently launched mutual fund investment options that provide higher returns on health savings that go unused. After the savings account balance reaches $2,000, excess amounts can be invested into one or more of eight no-load mutual funds.

Golden Rule spokeswoman Ellen Laden said another advantage to the new HSA rules includes a one-time transfer from an IRA to help fund an HSA. This is especially useful for early retirees who are no longer covered by employer-based plans and aren't old enough to qualify for Medicare.

The law also allows money to be moved from a flexible spending account — the use-it-or-lose-it part of many employer-based plans — to an HSA.

Laden said about one-third of people signing up for Health Savings Accounts with high-deductible plans were previously uninsured.

In Texas, Golden Rule found that most of their HSA clients were self-employed or a husband-and-wife business, followed by part-time workers and farmers and ranchers.

Long-term-care insurance premiums also can be paid out of HSA accounts beginning this year.

"There are young families that are concerned about the braces and the eyeglasses with the HSA," Laden said. "But there are older people who are worried about who is going to take care of them."

The growing use of the accounts is prompting new forms of banking to deal with unexpected expenses.

For example, if a person has made one contribution to the savings account at the beginning of the year, but gets hit with a big deductible right away, it can create problems, said Bart Halling, vice president for consumer-driven health products at Fiserv.

That could create a market for specialty lending against future HSA contributions, he said.

"My call to action on the consumers' side is to have a little bit longer horizon on planning for health care expenses," Halling said. With traditional health plans, "people are used to planning in nice one-year blocks." With HSAs, they need to plan for larger expenses before a health event, he said.

Hillje said the health savings account has made him think differently about medical expenses.

"The HSA has just made it more workable for a self-employed person," Hillje said. And because the first few thousand dollars of medical expenses each year will come out of his pocket, he says the family is more cautious about how they use the health care system.

The family still goes for regular doctor visits at provider network discounts to stretch their dollars further, and preventive medicine remains the way to control costs down the line.

"We don't just run to the doctor every time somebody has a cold," Hillje said. "It makes you really think, 'Do we need to go?'"

Learn more about Health Savings Accounts at http://www.health--savings--accounts.com

Posted by Wiley Long at 08:56 AM | Comments (2)

April 13, 2007

Enrollment Up in Health Savings Account Plans

A new census released by America's Health Insurance Plans (AHIP) found 4.5 million Americans are now covered by lower-premium, high-deductible health insurance plans that are offered in conjunction with Health Savings Accounts (HSAs), a 43 percent increase since last year.

The census found that more than one-fourth of those purchasing HSA plans in the individual market were previously uninsured and that almost half of those enrolled in such plans were over the age of 40.

The census also reveals that HSA plans provide value-added services. Most companies offer HSA plans that cover preventive care before the deductible is met, provide disease management programs for chronic conditions, and include a wide array of Web-based tools to help consumers make more informed decisions.

This is the first AHIP census that compiled information about Health Savings Accounts that work in conjunction with HSA plans. Eighty-eight percent of accounts in place in 2006 had average annual balances of $2,500 or less, while 4 percent had average annual balances over $5,000. As of January 2007, 65 percent of accounts had been in place for less than one year.

"Consumers and employers want coverage choices," said Karen Ignagni, President and CEO of AHIP. "Our members have worked effectively to create HSA products that are built on the widespread availability of first-dollar preventive coverage, disease management services and online decision-support tools."

Other key findings from the census include:

-- An increase of 1.3 million Americans enrolled in an HSA plan. Previous censuses found 3.2 million enrolled in January 2006 and 1.0 million enrolled in March 2005.

-- Slightly over 1 million were enrolled in the small-group market and 2 million in the large-group market.

-- HSA plans accounted for 25 percent of new products in the individual market, 17 percent of new policies in the small-group market, and 8 percent of new policies in the large-group market.

-- Most companies (over 90 percent) offered HSA plan options with preventive benefits that are covered before the deductible is satisfied.

-- Most companies offer disease management services for patients with asthma (82 percent), chronic obstructive pulmonary disease (65 percent), congestive heart failure (84 percent), coronary artery disease (84 percent), and diabetes (91 percent).

-- Most enrollees have access to consumer information tools such as online access to account information (90 percent), online health education tools (95 percent), hospital-specific quality information (85 percent), physician-specific quality information (50 percent), health care cost information (88 percent), and Personal Health Records (70 percent).

Posted by Wiley Long at 11:03 AM | Comments (0)

March 29, 2007

Health Savings Accounts are Working for More than Just the Young and Health

For some individuals with cronic conditions, a Health Savings Account can be a great option. The best way to decide if a Health Savings Account is right for you is to do a little research.

As an example, we have a client who is diabetic. She found it was possible to get a High-deductible health insurance policy which was savings her $200 dollars in reduced premium each month. Even though her out of pocket expense for insulin and other supplies was over $80 a month she was still saving over $100 a month. This calculated into a $1,200 per year savings that she keeps in her Health Savings Account. She decided that she would prefer to keep the extra money instead of paying it to an insurance company.

Many of the detractors of Health Savings Accounts warn that only young, healthy, financially stable people with good jobs benefit for HSAs because they are the only ones who can afford it. But in reality, the amount you invest in Health Savings Account can be deducted from your annual income tax calculations. In addition, once you deposit that money into a Health Savings Account it is left to grow tax fee. This is not a tax haven for the rich, but can benefit anyone for whom lower taxes mean more money in the bank. Until you do the caculation, you really will not know if a Health Savings Account works for you and your family.

On top of this, you can use the money in your HSA for a wide range of medical expenses such as preventive care, dental checkup, and other medical appoints. You can review all the HSA Qualified Medical Expenses.

As individuals become more responsible for their healthcare, expectations are they will do a better job of shopping for healthcare. From a more optimistic view point, individuals paying medical bills and seeing the real price of medical care will fuel healthy competition among healthcare providers, reduce cost and increase the quality of healthcare.

Learn more about HSAs at: http://www.health--savings--accounts.com

Posted by Wiley Long at 09:02 AM | Comments (0)

March 23, 2007

More Companies Offering Health Savings Accounts

The number of employers offering Health Savings Accounts continues to grow. However, those companies that are most effective at controlling health care costs are combining HSA plans with other health-related tactics. Those are among the major findings in an annual survey conducted by Watson Wyatt Worldwide and the National Business Group on Health.

In the survey of 573 large companies, the portion of companies offering a Health Savings Accounts increased from 33 percent to 38 percent in the last year.

As of five years ago, only a handful o