Bad News for HSA Insurance Plans

Effective January 1, 2011 individuals and families that currently have a high deductible Health Savings Account, aka HSA will no longer be able to purchase "over the counter" medications through their HSA expense account.

The new law (which is part of our newly passed Health Care Reform 2010 package) removes over the counter drugs not prescribed by a physician from being paid from an HSA, FSA, or HRA on a tax free basis. Additionally if you use HSA funds for non qualified expenses you will face a higher penalty, increasing from 10% - 20%.

To learn more about HSA accounts visit QuoteBroker's website or receive an instant Health Insurance Quote or HSA online.

IRS Releases 2010 HSA / Health Savings Account Limits

IRS announces 2010 HSA limits
Source: IRS Rev. Proc. 2009-29, IRB 2009-22

The IRS issued guidance on the maximum contribution levels for health savings accounts (HSAs) and out-of-pocket spending limits for high deductible health plans (HDHPs) that must be used in conjunction with HSAs. These amounts have been indexed for cost-of-living adjustments for 2010.

Annual contribution levels. For 2010, the maximum annual HSA contribution for an eligible individual with self-only coverage is $3,050. For family coverage the maximum annual HSA contribution is $6,150.

Out-of-pocket spending. The maximum annual out-of-pocket amount for HDHP self-coverage increases to $5,950 and the maximum annual out-of-pocket amount for HDHP family coverage is twice that, $11,900.

Minimum deductible amounts. For 2010, the minimum deductible for an HDHP increases to $1,200 for self-only coverage and $2,400 for family coverage.

For assistance with your 2010 Health Insurance Plan (H.S.A.), visit QuoteBroker.com or call (800) 783-0802.

Employee Benefit Shopping 101

As the fall season approaches, many large and small companies will begin to start shopping for their 2009's employee benefit programs. Typically employers should plan on shopping insurance 60-75 days before the desired effective date.

High deductible health plans and Health Savings accounts will continue to be popular. These plans make workers responsible for costs up to a certain amount but then covers most expenses over that. Workers have a greater risk of paying out-of-pocket expenses, but premiums are lower — so their paychecks are higher. Wellness programs encourage them to take care of themselves, ultimately cutting costs for themselves, their employer and the health plan. Wellness plans usually allow employee's to visit the doctor for a flat co-payment of $20-$40, for services such as well baby care, annual physicals and well woman's check up's. Others allow for office visits without first satisfying their deductible.

For 2009, most employers will see premium increases in excess of 10%. This leaves employers already stressed by a stagnant economy with a larger dilemma: how to offer good health benefits to keep or attract quality workers at a price they can afford.

It is important to plan ahead. October is a great month to begin shopping for 2009's benefit plans. For employer groups with less than 50 employees, shop online with an internet brokerage firm. Before you start the process you will need some basic information. It's actually very simple. You will need your employees dates of birth (along with any family members participating) and their zip codes. The plan design and costs will evolve as you begin to shop for plans. An online brokerage service such as Quotebroker.com allows you to use the same software system brokers use to shop and compare prices throughout the state. Instantly compare affordable health insurance options without ever speaking to an insurance agent. Once you have completed your market study, QuoteBroker has Group Insurance specialists available to assist you with the enrollment process. Larger groups are encouraged to use a quality insurance broker that has experience in negotiating rates with multiple insurance providers.

If you have more than 20 employees "ask for more". There is often room to negotiate lower rates for additional products such as dental, vision and term life insurance.

Health Savings Accounts - What you can & can't do with the money

Health Savings Accounts (HSA) are on the rise again. More companies are also allowing their employees to participate in HSA’s. To understand HSA’s and how they work, we recommend reviewing that information online. The purpose of this article is to explain what you can do with the money in your Health Savings Account..

You can make a contribution into your HSA each year that you are eligible. For 2008, you can contribute up to $2900 for single coverage and $5800 if you elect family coverage.Individuals over age 55 can make an additional contribution of $900. These amounts are adjusted annually for inflation.

Your HSA account is usually through a bank, credit union or financial services company. The money within your account can be invested and grow tax deferred.

You can use the money within your account to pay for any “Qualified Medical Expenses” permitted under the federal tax code.The most common being; most medical care and services, dental and vision, and medications, including over the counter drugs such as aspirin. Your HSA most likely has a Debit Card to use for these expenses.

Most people do not understand that you can NOT use this money to pay for your health insurance premiums. There are a few “special circumstances”, that allow you to pay premiums, including periods of when receiving unemployment benefits, COBRA continuation and when paying for certain Medicare expenses. The most overlooked deduction is Long Term Care Premiums. This is permited if the LTC plan is "qualified". Always look for a “qualified” Long Term Care policy.

This money can be used to pay for your medical expenses and all expenses incurred by your dependent children or spouse.

There are penalties for using funds for any other expenses that are not considered “qualified”. For example you can not use the money for Cosmetic Surgery, paying for Supplemental Medicare premiums or other non medical expenses.To learn more about the Health Savings Accounts and how they work, visit the QuoteBroker website.

This information was intended to be educational and you should always consult your insurance, tax or legal representative to discuss how an HSA applies to your situation. Additional information can be located at the Department of Treasury website.