HSA Plans for Business

sketch1With all of the recent me- dia hype regarding fed- eral health insurance reform and the state of the health insurance industry, I’m sure by now you have heard the term HSA. You may be wondering: What does this mean? How does it apply to me as a busi- ness owner? Let me explain. HSA stands for Health Savings Ac- count. It is a form of consumer directed health coverage which pairs a high-deductible health plan with a tax-free savings account for medical expenses. These plans are designed to reduce healthcare insur- ance costs for employers and em- ployees alike.

Healthcare cost squeeze on businesses~ HSA Plans for Business – Why you may want to consider it Written by Elizabeth Brooke Thedford Agency Manager Deerfield Advisors “THE DEERFIELD ADVISOR” white paper series of publications is written & produced by Deerfield Advisors for the exclusive use of its clients & friends & may not be reproduced in any form whatsoever without the express written consent of Deerfield Advisors. “THE DEERFIELD ADVISOR” white paper series is a registered trademark of Deerfield Asset Management, Inc. DBA Deerfield Advisors. Copyright 2013. All rights reserved. Solutions for Business

Deerfield Traditional Edition| 2013 Since most first-dollar ex- penses are paid by a third party (insurance companies), medi- cal expenses have soared, and with the cost of employee benefits rising, small businesses are being squeezed to find new ways of reducing healthcare contributions. An HSA offers a new, viable alternative. It is meant to get consumers more in- volved in their healthcare decisions. By allowing them to shop their

healthcare, Health Savings Accounts encourage competition among providers and lead to lower costs. It is believed that individual consumers are better able to decide how and where to spend their healthcare dollars than are insurance compa- nies, and that people who buy medical services using their personal HSA funds will shop around for the best value for their dollars, and health care providers will feel pressure to charge competitive rates to attract patients. Because group insurance rates can be to three times as expensive as individ- ual plans, an alternate option for most small busi- nesses is to let the employees sign up for individ- ual coverage rather than group coverage. These are the main advantages of this strategy: • Individual plans are 100% portable, meaning that they are not tied to the employer’s business. The employees can take the coverage with them, wherever they go, as well as deal with the grunt work involved, thus removing it off of your plate and allowing you to concentrate on running your business. • Because HSA plans are individually underwrit- ten, they are much less expensive, which helps your bottom line if you are footing all or some of the bill. • Contributions are not considered gross in- come; they are tax-free. So both the employer and employee receive tax benefits from this ar- rangement. • HSA accounts qualify for year to year “rollovers,” which enable the employee to cre- ate a sizeable health insurance cushion.

P roponents of HSAs believe that it is an important reform that will help reduce the growth of health care costs and increase the effi- ciency of the health care system. They contend that HSAs encourage savings for future health care expenses, allow the patient to receive needed care without a gatekeeper to determine what benefits are allowed, and make consumers more responsible for their own health care choices through the required high-deductible health plan options which they will choose. Funds in an HSA account can be used to meet your deductible as well as other non-covered legitimate medical expenses including vision and dental expenses. Funds in an HSA can be used for any family member’s eligible medical expenses even though HSA accounts are individual accounts. The end result is that you may be able to cut your costs in half, while provid- ing your employees with better coverage. Small businesses need a solution to health insurance that will enable them to retain their valued employees while maximizing profits. Health Savings Accounts may be the solution you and your business need. HSA enables you to give your employees better healthcare coverage and balance to your company budget . 

A t the end of the day, it’s really important to make sure you have health coverage in place for a finan- cial back stop. Remember, it’s all about Financial Independ- ence. Planning for that day when the sky falls. It would be Like any health care option, health savings accounts have advantages and disadvantages.

F inal Thoughts~ This article is intended only as a general discussion of these issues & we cannot guarantee the accuracy thereof, it does not purport to provide legal, accounting, or other professional advice. If such advice is needed, please consult with your attorney, accountant, or other qualified adviser. The Views expressed here do not constitute legal advice. The information contained herein is for general guidance of matter only and not for the purpose of providing legal advice. Accordingly, the information provided herein is provided with the understanding that Deerfield Advisors is not engaged in rendering legal advice. Deerfield Advisors strongly advises that clients and/or the reader of this publication contact an attorney to obtain advice with respect to any particular issue or problem discussed here. Also, please know that discussions of insurance policy language is descriptive only. We strongly advise that one’s individual policy & ones advisor be consulted regarding this subject matter before any action is taken in any way. Coverage afforded under any insurance policy issued is subject to individual policy terms and conditions. The Deerfield Advisor White Paper Series is a registered trademark of Deerfield Asset Management Inc. DBA, Deerfield Advisors and is produced by Deerfield Advisors for the benefit of its clients, and any other use is strictly prohibited. All rights reserved. Copyright © 2013 http://www.deerfieldadvisors.com

When considering a health savings account, think about your anticipated health care expenses, your financial situation and how much con- trol you want over your health care spending. If you’re generally healthy and want to save for future health care expenses, an HSA may be an attractive choice. On the other hand, if you anticipate needing ex- pensive medical care in the next year and would find it hard to meet a high deducti- ble, an HSA might not be your best option. Therefore you will need to determine what works best for you.

 coverage when you’re ready. Just give us a call. very unwise to rely on the promises of Obama care, cra- dle to grave nanny state tax- payer paid healthcare. A per- son must plan for him or her- self & the HAS is a great start & alternative to doing that. Deerfield can help you obtain