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Health Savings Accounts (HSAs)

What is an HSA?

Health Savings Accounts (HSAs) was created by the Medicare bill signed into law by President Bush on December 8, 2003, and enhanced in December of 2006 by the Health Opportunity Patient Empowerment Act which provides new opportunities for participants. HSAs are designed to help individuals save for future qualified medical and retiree health expenses on a tax-free basis. This amazing program is a significant expansion of its predecessor, the Medical Savings Account (MSA).

HSAs are portable, and unlike a Flexible Spending Account (FSA), the unused balances roll over from year to year. Further, the new Act allows rollovers from health FSAs and HRAs into HSAs through 2011 for qualified participants.

Great Northern Benefits believes that HSAs are an important part of consumer-driven health care and should be considered seriously by anyone looking for rate relief. The advantages are obvious. Read on and decide for yourself if you want to continue cost-shifting and still shoulder the burden of double-digit premium increases or if you prefer to keep dollars in an interest bearing account - with definite tax advantages.

What Is an HSA and How Does it Work?

A HSA is a tax-exempt account that you can establish with a qualified financial institution in which you accumulate savings to pay for qualified medical expenses. Contributions and income earned on funds in the account is 100% tax-free. HSAs work like IRAs, except that the money in the account is used to pay for qualified medical expenses. An HSA consists of two basic components:

1. A qualified high-deductible insurance plan.
   
2. A qualified HSA trustee account (a tax sheltered savings account). Contributions for 2009 are capped at $3,000 for individuals and $5,950 for a family. These amounts are indexed for inflation.

Employees enroll in a relatively inexpensive qualified high-deductible insurance plan. Then, a qualified tax-deductible savings account is opened to cover current and future medical expenses. The money deposited (either by the employee, employer or a combination of both), as well as the earnings, is tax-deferred. The accumulated deposits can be withdrawn to pay for qualified medical expenses such as vision, dental and prescriptions, tax-free. The account can be accessed via an HSA debit card and/or HSA checking account. This puts health care decisions back into the hands of consumers.

Copyright 2004 Golden Rule Insurance Company

Who Can Qualify?

• Anyone with a qualified high-deductible insurance plan, anyone not covered by other health insurance (e.g., through a spouse), anyone under the age of 65 and not entitled to Medicare, large employers, small employers, the self-employed and C-Corp owners.

How Can One Enroll in a High-Deductible Insurance Plan?

Group insurer Blue Cross and Blue Shield of Michigan has several HSA-compatible health plans available now. Likewise, Priority Health, a regional managed care organization, have very good products which we can also quote for you today.

If you have questions, the US Department of Treasury has a very informative website with HSA FAQ's at: "www.treas.gov/" if you are interested in learning more either as an individual or as a benefits purchaser.
Great Northern Benefits wants to be the agency you look to for information and service. We want to work with you to help you manage your healthcare benefit dollars!

Voluntary Benefits

Voluntary Benefits (employee-paid) are a great way to offer additional coverage to your employees. Employees can buy dental, vision, life, and disability products directly from vendors through a payroll deduction. The choices are personal and based on individual need. Voluntary Benefits are appealing in that they cost employers next to nothing, are a great way to enhance employee morale, and are great recruitment and retainage tools.

Please contact Great Northern Benefits at info@greatnorthernbenefits.com for additional information.

MyBlue Individual Health Care Plans

Blue Cross Blue Shield of Michigan offers a suite of individual plan options to cover you and your family. Coverage options include comprehensive and HSA-compatible medical plans, prescription and office visit coverage, and dental and maternity benefits. Whether you are single, a recent college graduate, self-employed, starting a family or considering early retirement, Great Northern Benefits can show you plans that meet your needs with premiums that are affordable.

Please contact Great Northern Benefits at info@greatnorthernbenefits.com for additional information. One can also self-quote and enroll by clicking on the "Request for Quote" tab on our website and following the prompts.