Justin Barclay and I had fun on the radio yesterday discussing the unintended consequences of ObamaCare on the Jay Severin show:
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
ObamaCare Calculators
MyObamaCareCalculator.com
Yes, the Affordable Care Act (ObamaCare) is upon us. As of now (August 2013) there are still way more questions than answers.
Should I keep my existing plan or get a new EXCHANGE plan?
Should employees & their dependents remain on employer group plan or get their own individual policy?
Will I qualify for a subsidy?
We have assembled several calculators available today that can help make preparing for 2014 much easier.
Although the employer mandate has been postponed until 2015, the individual mandate still applies. Anyone not covered by Minimum Essential Coverage next year could be subject to a penalty tax of the greater of $95 per uninsured or 1% of household over the filing threshold:
INDIVIDUAL PENALTY TAX CALCULATOR
All new health insurance plans will be guaranteed issue and required to include essential health benefits which will greatly increase premiums. The Public Exchanges (both state and federal) are to be open in October. People making less than 400% of poverty level could be eligible for subsidized health insurance plans if they are purchased on the State / Federal Exchanges. It is estimated that 26 million should be eligible for these subsidies, however only 6 million are estimated to enroll in 2014. Here is a calculator to see if you would be eligible for a subsidy:
INDIVIDUAL / FAMILY SUBSIDY CALCULATOR
Small businesses with less than 25 employees that earn less than $50,000 average annual salary and pay at least 50% of their health insurance premiums could also qualify for a small business tax credit. For 2014 the tax credit is only available if the plan is purchased through the Small Business Health Options Program (SHOP) Marketplace:
SMALL BUSINESS HEALTH INSURANCE TAX CREDIT CALCULATOR
Don’t wait until it’s too late. If you are relatively healthy, you could save money by applying now BEFORE all plans are guaranteed issue and are weighed down with expensive government mandated benefits next year.
INSTANT ONLINE HEALTH INSURANCE QUOTE
Or you can call an independent health insurance agent at 913-432-2732.
Although the employer mandate has been delayed 12 months, businesses are still concerned about how to minimize (or eliminate) their exposure in 2015. This calculator helps calculate how many full time equivalent (FTE) employees you have and what your potential penalty might be if/when the employer mandate is reinstated:
And finally, for those of you with seven minutes to spare, here are the YouToons simplifying 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
ObamaCare has been ruled Constitutional… NOW WHAT?
Regardless of how SCOTUS arrived at its decision, ObamaCare (Patient Protection & Affordable Care Act) is now the law of the land.
I was interviewed this morning on The KCMO Morning Show with Greg Knapp. He asked me what ObamaCare will do to our current insurance plans:
Click HERE to listen to the interview
Greg Knapp and Scott Borden
We discussed several of the mandates that will raise health insurance premiums such as guaranteed issue and the rarely mentioned time bomb known as the 3:1 Ratio. If only young people understood how ObamaCare will significantly increase their health insurance premiums, maybe they won’t be as eager to support Obama like 68% of them did in ’08.
There is still a chance to overturn the largest tax increase and re-distribution legislation in the history of our country. Your chance will come November 6th.
Democrats vote November 7th.
(UPDATE: Read ObamaCare vs. Health Savings Accounts article published in Ingram’s Magazine September, 2012)
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.
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
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
TAX TIME! Maximize your Tax Deductions for 2010
Click HERE for latest update
- Take your personal HSA tax deduction on line 25
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 2010. Remember, if you were covered by an HSA qualified High Deductible Health Plan (HDHP) on or before December 1st, 2010 then you have until you file your taxes (or April 15th 2011) to finish up your 2010 contributions and get a 2010 tax deduction.
2010 Contribution limits:
Single – $3050
Family – $6150
Catch up contribution (age 55 or older) $1000 per person*
2011 Contribution limits:
Single – $3050
Family – $6150
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 2010 OR if it was in force by December 1st of 2010 AND remains in force all 2011.
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.
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 10 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. If you have been covered by your HDHP before or on December 1st, 2010 and haven’t set up your HSA, it’s not too late!
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 350,000 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 $13,000 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
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
What Is An HSA?
A Health Savings Account (HSA) is a tax-deductible account to which you can contribute to save for future medical expenses or to pay for any day-to-day, qualified medical expenses permitted under federal tax law...[More]
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