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Health Savings Accounts (HSAs)
Consumer Directed Plans
Develop Appreciation for Cost of Services
The Advantage is:
– You are reducing your premium, and taking control of the rest
Flexibility
The Future of Healthcare is NOW!
Support Services Alliance, Inc.
Main Objective of HSAs
Reduce Fixed Premium
Increase Possible Expense
Support Services Alliance, Inc.
You only pay for services when you actually use the service!
Definition
Deductible is the amount of money paid out of pocket before the insurance is used.
Support Services Alliance, Inc.
Health Insurance XL2250H
Employee pays 100% of all medical expenses before the deductible
Policy pays 100% of all medical expenses after the deductible
Individual
$0
2-PersonFamily
$0
$2,250
$4,500
Unlimited
EE pays 100% Insurance pays 100%
Family Deductible
HSA deductibles are aggregate
Aggregate deductible is twice the individual deductible, and must be met before charges are paid by the insurance carrier
Individual Deductible Family Aggregate
$2,250 $4,500
Support Services Alliance, Inc.
Health Insurance
Deductible covers– Physician’s visits & Services– Inpatient Hospital Services– Outpatient Hospital Services– Prescription Drugs– (*Detailed list on XL2250H brochure)
No Deductible required – Well child visits and routine immunizations for children up to age 19
Support Services Alliance, Inc.
Health Insurance Specifics
NO REFERRALS EVER
Underwritten by Univera Healthcare
Dependents covered until December 31st of the year they turn 23
Support Services Alliance, Inc.
Health Insurance
Freedom of Choice – In & Out of Network
Providers– WNY – Univera– CNY – Excellus BlueCross BlueShield – Outside NYS – Beech Street Network
Best way to find doctor/hospital– Smallbizgrowth.com– Then click “Find a Provider”
Support Services Alliance, Inc.
2 Separate Parts
High-deductible health insurance plans
Savings Account
Health Insurance Savings Account
HSA-eligible high-deductible health plans with benefits such as:
-Freedom of choice of physicians and hospitals-Physician’s services-Inpatient hospital services-Outpatient hospital services-Prescriptions
Can be used for all of the deductible expenses and coinsurance (if necessary) under medical, as well as:
-Dental-Vision-Over-the-counter medication-Long-term care premiums-Long-term care expenses-Annual physical
Support Services Alliance, Inc.
Tax Treatment of Contributions
Employer contributions
– Contributions made by the Employer are NON-taxable to the employee
Employee contributions
– May be an above the line deduction on form 1040 of federal income tax return or
– Pre-tax deduction out of paycheck
Support Services Alliance, Inc.
AccumulationsAccumulations
Interest earned in Savings account is tax-deferred
– No maximum limit on account balance
NOT a “use it or lose it” account
Can always be used for out-of-pocket medical costs.
Account is 100% owned by the employee.
– If the employee leaves their job, the account and the money in the account remains with the employee.
Support Services Alliance, Inc.
Withdrawals
Withdrawals made for qualified medical expenses are tax free
Non-qualified expenses subject to 10% penalty plus taxes (penalty is waived for death or disability)
Non-qualified withdrawals for individuals age 65 and above are subject to income tax only
Accurate record keeping is employee’s responsibility
– If audited, employee is responsible to prove withdrawals were qualified
Support Services Alliance, Inc.
Claims
In-Network: You Pay a Reduced Rate
– Doctors, hospitals, testing, etc.
– Pharmacy
Claim Procedure
– MD or Hospital – “Run the Claim”
– Pharmacy – Use Debit Card or Check
Support Services Alliance, Inc.
Office Visit
You go to the doctor and show your card but DON'T PAY ANY CO-PAY
Doctor sends claim to Univera
Univera tells the doctor the negotiated rate to charge the client
Doctor sends client the bill, Univera sends EOB to client
Client pays the doctor.
If there is money in the HSA you can use that money to pay the doctor.
Support Services Alliance, Inc.
Prescription Drug
You go to the Pharmacy and show your Insurance card
If you haven’t reached your deductible you pay the full negotiated rate to the pharmacy
If there is money in the HSA you can use that money to pay the Pharmacy.
Support Services Alliance, Inc.
How Will a HSA Save Me $$$
Low Utilizing Person
Normal Utilizing Person
High Utilizing Person
Support Services Alliance, Inc.
Low Utilizer
Support Services Alliance, Inc.
Current Plan HDF
Premium $230/month $144/month
Annualized $2,760 $1,728
1 Dr. Visit $10 $100
Actual Cost $2,770 $1,828
SAVINGS $942
Example of Healthy Person
Normal Utilizer
Support Services Alliance, Inc.
Current Plan HDF
Premium $230/month $144/month
Annualized $2,760 $1,728
2 Dr. Visit $20 $200
1 Script $120 $360
Actual Cost $2,990 $2,288
SAVINGS $612
Example of Normal Person
High Utilizer
Support Services Alliance, Inc.
Current Plan HDF
Premium $230/month $144/month
Annualized $2,760 $1,728
12 Dr. Visit $120 $1,200
8 Scripts $2,400 $1,050
Actual Cost $5,280 $3,978
SAVINGS $1,302
Example of Very Ill Person
10 co-pay
Avg. co-pay $25 Maxed out
You May Use Funds For:
OTC Drugs
Dental
Vision
Portion of Long-Term Care Premiums
These Expenses WILL NOT Reduce Your Deductible
You Are Not Required to Use HSA Funds
Support Services Alliance, Inc.
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