AFFORDABLE [uh-fawr-duh-buhl] adj.

According to dictionary.com, affordable means, “believed to be within one’s financial means.” Obviously the politicians in Washington took this definition literally when they passed the Affordable Care Act.

According to an article in Forbes this past week, individual health insurance premiums will increase by an average of 41% across the country. Offering subsidies to a small subset of Americans to help offset substantially higher rates for everyone else doesn’t make sense.  However by this definition, all they needed to do was to make health insurance within one’s financial means.  And as of yesterday we know at least 5 have enrolled so far.

The Manhattan Institute put together an excellent interactive map that shows pre and post ObamaCare rates for each state:

Manhattan Institute – Know Your Rates

There are winners and losers in ObamaCare.

Winners: unhealthy people that were forced into expensive state pool guaranteed issue health plans that can now get any plan they choose without proof of insurability
Winners: low wage earners that qualify for expanded Medicaid or a substantial premium subsidy (and actually make it through healthcare.gov)

Losers: everyone else

I guess it all depends on what your definition of the word “Affordable” is…

ObamaCare is HERE!

ObamaCare is here…
The healthcare landscape has changed.

Dave Ramsey’s ELP

As Dave Ramsey’s Endorsed Local Provider (ELP), our goal is to make you aware of these changes.

We have tools available to help answer your questions:

• Do I qualify for a subsidy?
• What would my penalty be if I don’t have health insurance?
• Should I buy a plan now or wait for 2014?
• Should I keep my current plan?

You have more options available now than you will have next year.

MyObamaCareCalculator.com

For an individual / family PRE-OBAMACARE QUOTE, click on your state:

Alabama                             Montana
Alaska                                 Nebraska
Arizona                               Nevada
Arkansas                            New Hampshire
California                            New Jersey
Colorado                            New Mexico
Connecticut                        New York
Delaware                            North Carolina
Florida                                North Dakota
Georgia                              Ohio
Hawaii                                Oklahoma
Idaho                                  Oregon
Illinois                                  Pennsylvania
Indiana                                Rhode Island
Iowa                                   South Carolina
Kansas                                South Dakota
Kentucky                            Tennessee
Louisiana                            Texas
Maine                                 Utah
Maryland                            Vermont
Massachusetts                   Virginia
Michigan                             Washington
Minnesota                          West Virginia
Mississippi                          Wisconsin
Missouri                             Wyoming

Obama-Car

While talking about healthcare reform with my wife, our teenage son started asking questions. We tried to answer him in a way he could understand, but we just weren’t getting through. Health insurance is a foreign language to him. However he is dreaming about which car he will soon purchase. So we introduced ObamaCare to him by way of the Affordable Car Act… a.k.a. Obama-Car:

Obama says his reforms will include additional mandated essential health benefits AND reduce health insurance costs by $2500 per family. That’s simply impossible. That would be like requiring all 2014 cars to be either hybrid or fully electric (more energy efficient), include run-flat tires with electronic low-pressure warnings (better fuel economy), HID headlights (better night vision), GPS (less fuel wasted getting lost), and satellite radio (because it sounds good) at a lower price.

Yes, these OPTIONS are nice if you have the money to pay for them, but they should remain OPTIONS, not REQUIREMENTS.

Instead of a Chevy Cruze starting at $17,000 the new Obama-Car compliant version (such as the Chevy Volt) would be priced around $34,000.

Obama claims these new cars will only be paid in full by the “millionaires and billionaires” because anyone making less than 400% of the poverty level will have some (or all) of their car subsidized by the government.

Now let’s talk about used cars…

Let’s say you like your existing car.  As long as you owned it before March 23, 2010, you would be allowed to keep it. You cannot make any changes to it or it would no longer be “grandfathered” and you would be forced into buying a new Obama-Car next year or pay a penalty.

If it doesn’t get good enough gas mileage or include all the new Obama-Car required Overpriced Bureaucratically Authorized Mandated Add-ons (OBAMA), then you would also be penalized.

Our son is glad Obama-Car doesn’t exist. He can save his own money to purchase any car he chooses… as long as Dad (not Obama) approves of it!

Dislaimer:  This article was never meant to suggest Obama-Car legislation is needed or should ever become law.

Prepare For ObamaCare

Dear Nancy Pelosi,

After 3+ years and 20,000+ pages of additional clarifications…
WE STILL DON’T UNDERSTAND WHAT’S IN IT!

Senate Minority Leader Mitch McConnell (R-KY) points up at ObamaCare

ObamaCare vs. Health Savings Accounts

(Updated 2013 post-election)
The Patient Protection and Affordable Care Act (PPACA, ObamaCare) has been ruled constitutional. And Obama has been re-elected so there is no chance of repeal. What does all this mean for Health Savings Accounts?

HSA qualified High Deductible Health Plans (HDHP) are the fastest growing segment in health insurance today. Over 15 million people have over $17 billion saved in their HSAs. Since unspent HSA funds roll over from year to year, HSA owners have a vested interest in not spending their own healthcare dollars. The more common co-pay plans insulate people from costs which often results in over-utilization. HSAs change this behavior. This is why they are commonly referred as ‘Consumer Driven Healthcare’ plans.

There are some portions of the law that directly affect HSAs. There are several other rules that we have to speculate how they will be implemented. Let’s begin with the direct HSA rulings:

1. The penalty for ineligible withdrawals from an HSA has been increased from 10% to 20%
2. All over-the-counter medications now require a written prescription

That’s it. As long as you keep proper records verifying your HSA withdrawals were for eligible medical expenses (see publication 502) and obtain a written prescription for your allergy medication, pain relievers, etc. then you will not be subject to any penalty at all.

Now for the provisions that will impact HSAs indirectly:

1. INDIVIDUAL MANDATE (2014)
Since ObamaCare requires people to purchase health insurance, most people who are currently uninsured will look for the lowest cost option available. HSA qualified insurance policies are not allowed to have co-pays and have minimum deductibles of $1250 for self-only coverage and $2500 for families which makes them more affordable. This could dramatically increase how many HSA qualified plans are purchased.

2. STATE EXCHANGES (2014)
Exchanges are online portals where people can enroll in health insurance plans and potentially receive government subsidies based on income (up to 400% poverty level). Since HHS Secretary Kathleen Sebelius continues to interpret how these exchanges are to be implemented, this one is far from finalized. Companies will be allowed to offer up to 4 plans on the exchanges (bronze, silver, gold, platinum) each with mandated “Essential Health Benefits”. All exchange qualified small group plans have a maximum deductible of $2,000 for self-only coverage and $4,000 for families. This type of a restriction will increase the cost of HSA qualified health insurance plans over the larger deductibles available today (up to $6,050 for self-only coverage and up to $12,100 for families). But they should still offer a substantial premium savings over co-pay plans.

3. MEDICAL LOSS RATIO (2011)
ObamaCare requires Health insurance companies to pay at least 80% of all collected individual / small group premiums and at least 85% of all large group premiums out in benefits and claims. HSA qualified insurance plans typically cost less while still having similar fixed costs (insurance company marketing, underwriting, and claims processing) which makes MLR a difficult provision for them to comply with. This could limit the number of insurance companies that offer HSA qualified plans on the exchanges. However the elimination of underwriting costs (all plans will be guaranteed issue) and the reduction in marketing costs for the insurance companies once most insurance agents are replaced by exchanges should make all plans MLR friendly by 2014.

Unless Kathleen Sebelius makes an unexpected ruling, HSAs appear to not only survive ObamaCare, but potentially thrive.

So… Health Savings Accounts appear to have a bright future with or without ObamaCare.

Original pre-election version as published in Ingram’s Magazine September 2012

By the HSA GUY, Scott Borden
Host of “Insurance Talk with Scott & Mike” Saturday 7-8 AM on www.KCMOtalkradio.com
www.missionHSA.com
913-980-4694

TAX TIME! Maximize your Tax Deductions for 2011

Click HERE for latest update

Since this blog is dedicated to offering the most up-to-date Health Savings Account information, we want to make sure you maximize your HSA for 2011. Remember, if you were covered by an HSA qualified High Deductible Health Plan (HDHP) on or before December 1st, 2011 then you have until you file your taxes (or April 17th 2012) to finish up your 2011 contributions and get a 2011 tax deduction.

2011 Contribution limits:
Single – $3050
Family – $6150
Catch up contribution (age 55 or older) $1000 per person*

2012 Contribution limits:
Single – $3100
Family – $6250
Catch up contribution (age 55 or older) $1000 per person*

*If both are 55+ then both have to open HSA accounts for both to participate in catch up contribution

These limits are also stated on the U.S. Department of Treasury website.

These maximum contributions will not be pro-rated if your HSA qualified health insurance plan (HDHP) was either in force all 12 months of 2011 OR if it was in force by December 1st of 2011 AND remains in force all 2012.

Your tax deduction is based on how much you DEPOSIT into your HSA, not how much you spend.

You do not have to itemize to get the tax deduction.

You do NOT have to pay your eligible expenses out of your HSA.

HSA Eligible Medical Expenses

You are required to keep receipts of your eligible expenses in case the IRS audits you. You can choose to reimburse yourself at a later date up to the medical receipts you have accumulated without being subject to 20% penalty or taxable income.

The triple-tax advantages (tax deductible deposits, tax free interest earned, and tax free withdraws for eligible medical expenses) only available with HSAs make them an important tax planning tool that is unmatched when used properly.

Other statistics show that nearly half of the 11 million Americans covered by the required HDHP insurance plans have not established their HSA account, and therefore are not participating in the tax savings they offer. Although OFM Benefits is one of the nation’s premier HSA focused insurance agencies, there are probably some of you that have procrastinated setting up your account.

OFM is proud to recommend HSA Bank because of their great combination of low fees, competitive interest rates, and a large number of investment options.  With over 400,000 HSA accounts and over $1 billion in HSA deposits, HSA Bank has established themselves as one of the nations leading HSA administrators.  They also recently eliminated all setup fees.

As many Americans are facing huge health insurance premium increases and revenue decreases, HSA qualified plans are becoming even more popular. The average household pays over $15,000 per year for health insurance premiums! We feel HSA qualified plans offer the best value in healthcare today.

If you are self employed or a business owner and would like to receive the premium savings and tax deductions only available with HSAs, please visit www.missionHSA.com

http://www.missionHSA.com

Scott Borden
Host of “Insurance Talk with Scott & Mike” Saturday mornings 7-8 on KCMO Talk Radio 710
  OFM Benefits Consulting, LLC
6400 Glenwood, Suite 307
Overland Park, KS 66202
913-432-2732
913-432-2061 fax

State of the Union: How do the Presidential Candidates propose we change health care?

Last week (1/28/08), President Bush outlined some changes needed for our health care system.  Most of these have been mentioned many times before.  With Democratic control of Congress, we are unlikely to see very many of these pass this year.

The real question we need to consider is how do each of the current front-running candidates propose we fix our Health Insurance problems?

Grace-Marie Turner, President of the Galen Institute, wrote this article today:  http://online.wsj.com/article/SB119292772900066111.html

Now the real question…Will the next President actually keep campaign promises?

Scott

Socialized Medicine the Ultimate Cure? No. Here’s the Other Side of This Story…

With so many current politicians correctly stating that our health care system is in need of drastic changes, some have declared single-payer health care systems and socialized health care systems as the only thing that would solve our problems here in the USA.  These politicians often praise the Canadian system as one we should look to.  Many Americans saw the movie “Sicko” and agree with Michael Moore’s portrayal of socialized medicine as the ultimate cure.

Stuart Browning has produced a short video series that shows the other side of the story: www.freemarketcure.com

Although there are many examples of our system not working correctly, we believe the current privately insured system can be fixed.  Health Savings Accounts, along with their qualified insurance plans, are showing tremendous promise in significantly reducing health insurance premiums and making quality health care affordable for millions of Americans that were previously uninsured.