Health Savings Administrators» Health Savings Accounts – HSA Administrators

Who is eligible to open and contribute to an HSA?

WPJ — Tue, 11 Aug 2009 17:09:46 +0000

To open or contribute to an HSA you must meet certain eligibility requirements. Specifically:

You must be covered by a qualified high deductible health plan on the first day of the month
You cannot be covered by any other health plan that is not a qualified high deductible health plan, including spouse’s health insurance
You cannot be covered by spouse’s Medical FSA
You cannot be enrolled in Medicare Part A or Part B
You cannot be covered by TriCare
To make contributions you cannot have accessed your VA medical benefits in the past 90 days
You may not be claimed as dependent on another person’s tax return

Please feel free to contact us if you have any questions about HSAs with Health Savings Administrators.

The essence of Consumer Driven Health Care

WPJ — Fri, 15 Aug 2008 18:36:31 +0000

At its core, Consumer Driven Health Care is about asking “Is there a less expensive way to reach the same treatment goal?” Here are three true examples: My brother, suffering from a respiratory infection asked his physician (who was suggesting more tests to confirm the diagnosis) how the treatment plan would differ based on the results of the test. The answer, no difference. The cost of the test was avoided. An employee recounted to me last week how after switching to an HDHP he discovered his prescription was not the $50.00 month he had been spending but actually $150.00. The physician didn’t even realize he had put him on a tier 3 drug and quickly wrote a prescription for a generic. The employee saved $46.00 a month and the employer saved $100.00 per month. Lastly, an insurance agent I met recently told of how his wife had dislocated her shoulder and needed surgery. They are on an HDHP with an HSA. When the physician ordered an MRI to confirm the diagnosis, the patient asked if the MRI would reveal anything more than a less expensive X-ray would. The answer, no. The savings: $1,000+.

All of these questions resulted in less expensive, rather than less effective, health care. And they accomplished that with no new technology, no challenge to the physician’s expertise, just a few simple questions. That is the essence of Consumer Driven Health Care.

What are the keys to successful implementation of an HSA in the workplace?

WPJ — Wed, 18 Jun 2008 21:04:48 +0000

The attractiveness of a High deductible Health Plan (HDHP) is dependent upon three factors:

The difference between the employee contribution to the premium of HDHP vs. the traditional plan being offered. The greater the difference, the more the employee has to put into their HSA.
The employer contribution to the HSA. If #1 above is sufficient, the employer contribution doesn’t really matter. Ultimately the total employee savings and employer contribution need to be sufficient to fund the HSA to a level that makes the increased risk of the HDHP acceptable for the employee.
Education. If the employee (and their spouse) does not have a good grasp if the HDHP and HSA interaction they will not make a change, even if the contribution/savings numbers described above make sense. Repetition and education over time are the best methods for conveying the benefits of an HSA and for overcoming the natural fear of the unknown.

Can I pay Long Term Care premiums with my HSA?

WPJ — Wed, 11 Jun 2008 19:21:25 +0000

You may use your HSA for long term care premiums provided your policy meets certain requirements and you stay within the allowable premium expenditure limits.In order to spend money from your HSA on long-term care, your long-term care insurance contract must:

Be guaranteed renewable;
Not provide for a cash surrender value or other money that can be paid, assigned, pledged, or borrowed;
Provide that refunds, other than refunds on the death of the insured or complete surrender or cancellation of the contract, and dividends under the contract, must be used only to reduce future premiums or increase future benefits;
Generally not pay or reimburse expenses incurred for services or items that would be reimbursed under Medicare, except where Medicare is a secondary payer, or the contract makes per diem or other periodic payments without regard to expenses.

For 2008, the amount of premium you can pay with HSA funds are:

Age 40 or Under – Up to $290
Age 41 to 50 – Up to $550
Age 51 to 60 – Up to $1,110
Age 61 to 70 – Up to $2,950
Age 71 or Over – Up to $3,680

Who can I name as my beneficiary?

WPJ — Wed, 11 Jun 2008 14:43:59 +0000

You may have any person as your beneficiary. If you designate your spouse as your HSA beneficiary, the account will be transferred to your spouse’s name with all tax benefits intact. If you designate your HSA to a non-spouse beneficiary, the HSA funds will be liquidated and the beneficiary will be responsible for paying taxes on the balance.

Do I need to name a beneficiary for my HSA?

WPJ — Wed, 11 Jun 2008 14:41:48 +0000

Yes, you will need to name a beneficiary for your HSA. If your spouse is the beneficiary of your HSA, the account transfers as an HSA with all of the tax benefits intact. When you initially enroll in the HSA, you will be required to complete enrollment forms. Included in the enrollment form is a section for you to name your HSA beneficiary.