Presentation on theme: "1 The Nuts and Bolts of MyHSA. 2 2 MyHSA High Deductible Insurance High Deductible Insurance Health Savings Account (HSA) Health Savings Account (HSA)"— Presentation transcript:
2 2 MyHSA High Deductible Insurance High Deductible Insurance Health Savings Account (HSA) Health Savings Account (HSA) Helps pay your deductible Helps pay your deductible Tax-deductible deposits Tax-exempt growth Tax-free withdrawals for medical care Tax-free withdrawals for medical care Protects you from big medical bills Protects you from big medical bills Covers preventive care at 100% Covers preventive care at 100% Includes prescription coverage
3 What to know about Qualified High Deductible Health Plans (QHDHP): Qualified High Deductible Health Plan PPO80 & PPO90 Plans Deductible If you have more than one person covered, the entire family deductible of $2,600 must be met by one or more of your family members before DENSO will share in the cost of the claims. In the PPO80 and PPO90 plans, there is a lower individual deductible within the family deductible. Prescription Costs Go towards deductible or out-of-pocket maximum Copays are paid, which do not apply to the deductible & out of pocket maximum (no limit) Health Savings Account May be able to open one (if certain eligibility criteria are met) Not eligible because not considered a QHDHP. NetworkSame network for all three plan types
4 2013 MyHSA Plan Design (in-network) IndividualFamily DENSO Contribution (given to all 2013 HSA eligible enrollees) $500$1,000 Calendar Year Deductible$1,300$2,600 Out of Pocket Maximum (does not include deductible) $1,700$3,400 Preventive Care (office visits, labs, radiology, generic preventive prescriptions, etc.) 100% Sick Office Visits 80% after deductible Hospital Care Emergency Care Prescription Drug Copays 80% after deductible* *Preventive Rx Generic Preventive = 100% *Brand Preventive = 80% paid, deductible waived
5 5 MyHSA High Deductible Insurance High Deductible Insurance Health Savings Account (HSA) Health Savings Account (HSA) Helps pay your deductible Helps pay your deductible Tax-deductible deposits Tax-exempt growth Tax-free withdrawals for medical care Tax-free withdrawals for medical care Protects you from big medical bills Protects you from big medical bills Covers preventive care at 100% Covers preventive care at 100% Includes prescription coverage
7 What is an HSA? HSA = Health Savings Account It’s a bank account you own where money can be deposited and saved on a pre-tax basis to pay for qualified medical expenses. Think of it as a 401(k)-like account for healthcare expenses!
8 Are you eligible to open and contribute to an HSA? 1.You must be covered by a Qualified High Deductible Health Plan Example: DENSO’s MyHSA Plan 2.You must not have any other first dollar medical coverage Example: covered by your spouse on a non-qualified medical plan (low deductible, HMO, etc.) and/or your spouse has a Flexible Spending Account (FSA) through his/her employer 3.You must not be enrolled in Medicare 4.You must not be eligible to be claimed as a dependent on anyone else’s tax return (excludes spouse) Example: Your adult child is covered on your MyHSA medical plan but you do not claim them as a dependent on your tax return. They can open their own HSA bank account. You’re eligible if #1-4 above are true for you. Even if your spouse has another plan, he/she can be covered by the MyHSA plan as secondary insurance—which may qualify you for DENSO’s family contribution instead of individual!
9 What are other advantages? You own the account—not DENSO - If you leave DENSO, the account remains yours Unused funds roll over from year to year - No “use it or lose it rule” with an HSA Use the money to pay for expenses for yourself, your spouse or your children You can pay for their expenses even if they are not covered under the DENSO MyHSA Plan Several tax advantages – see next slide
10 What are the tax advantages? Contributions are pre-tax (or deductible at tax time) Earnings grow tax-free through investments Tax-free withdrawals for qualified medical expenses (includes medical, prescription, dental, and vision) – Withdrawals aren’t limited to the time (or year) of service—you can save your EOBs from when you were enrolled in a QHDHP and take a withdrawal years later—even if you’re no longer enrolled in a QHDHP HSA contributions are exempt from federal, FICA and most state income taxes (excluding CA, WI, NJ and AL). It is your responsibility to keep receipts and file accordingly on your tax return.
11 Who can contribute and how? You (each month you’re eligible) If you set up your HSA with OptumHealthBank, DENSO can payroll- deduct your contributions on a pre-tax basis You can also direct deposit money into your account You can change your deduction amount each pay period, like 401(k) Your family members Your employer - DENSO will contribute to your HSA account: IndividualFamily $500$1,000
12 Are there annual contribution limits? Each year the IRS issues new guidance on the maximum contribution levels for HSAs; here are the 2013 limits: IndividualFamily IRS Contribution Max$3,250$6,450 Less DENSO’s Contribution- $500- $1,000 If under age 55, you can contribute: $2,750$5,450 If 55 or older by 12/31/13, you can contribute: $3,750$6,450 Note: The above assumes you are eligible to contribute to an HSA each of the 12 months of the year. If you are not eligible on the first of each month, the above annual amount is divided by 12 and reduced accordingly. Associate + 1 or Family can contribute full Family amount It is your responsibility to make sure you don’t exceed the annual limit.
13 What qualifies as an eligible expense? Current or future medical expenses (even in retirement); Long Term Care Insurance, COBRA, and Medicare premiums – Account must be funded to receive distribution (cannot pay old medical expense for dates of service prior to establishing your HSA) Cannot be used to pay for a Medicare Supplement Plan You can use your HSA funds later for qualified expenses even if you switch to a different plan (like PPO80). Things to Remember: – Your account must have funds in it when you receive a reimbursement. – The IRS will tax you and charge you a 20% penalty if you use the money for non-qualified expenses (ex. buying a TV) – If you are age 65 or disabled (according to the Social Security Administration) when you take the distribution, the IRS will waive the 20% penalty. There are no eligibility rules for using your account funds— only eligibility rules for opening and contributing to the account.
14 About DENSO uses OptumHealthBank for HSA account management In order to receive DENSO’s contributions and to make your own contributions through payroll deduction, you must open your account through OptumHealthBank. Some features of OptumHealthBank include: No setup fee for online applications If you already have an account (and have not closed it), you can use the same account for new contributions. HSA Visa® Debit Card (unlimited transactions, no extra charge) Multiple account type options Interest-bearing account (FDIC insured) 24/7 HSA Customer Care Line Visit the OptumHealth website for additional details: www.optumhealthbank.com
15 How does the MyHSA Plan work? Associate enrolls in the MyHSA Plan. Associate confirms eligibility to open an HSA and does so through the optumhealthbank.com website. Associate completes the DENSO HSA Contribution Form and chooses whether to contribute through payroll deduction – Some elect to put in the amount that would have been paid in premiums. – Account balances earn interest (if applicable) and automatically roll to the next year. – Amounts can change each pay period, if requested. Associate receives DENSO’s contribution in his/her Optum HSA. – Annual Enrollment enrollee: in early 2013 – New Hire/Family Status Change enrollee: first of month following MyHSA enrollment, or when account is established, whichever is later Associate presents appropriate ID card when going to the doctor, pharmacy, dentist, eye doctor, etc. Providers submit claim to insurance company and bill associate after Plan pays and discounts are applied (if applicable). Associate chooses whether to pay Provider using HSA funds (using debit card or online payment option) or whether to pay out-of-pocket and save the HSA funds for later. Remember: If unexpected eligible health expenses arise during the year, the Associate can choose to have money payroll-deducted into HSA to pay for expenses on a tax-free basis (state taxes may apply).
16 HSA Claim Example (Individual Plan) Assumes Deductible and Out of Pocket Maximum have not been met Medical Expenses Total Claim Cost (after discount) Applied to Deductible? Your Portion Annual Routine Physical$250n/a$0 Preventive Brand Prescription (Deductible waived, 20% coinsurance) $100no$20 Sick Office Visit$80yes$80 Preventive Vision Exam$70n/a$0 Preventive Generic Medication (Covered at 100%) $20n/a$0 Surgery$4,200yes $1,220 (deductible) + $596 (coinsurance) Sick Visit Prescription (antibiotic) $40yes$8 Total Cost$4,760$1,924* *Associate could use HSA funds to pay this amount or pay out of pocket and continue to build his/her account. $1,300 deductible met Begins 20% coinsurance
17 You may be right for the MyHSA Plan if… You (and your family members) are generally healthy – If you participate in a PPO plan, you may be paying premiums for coverage you don’t even use. You (or your family members) are on a lot of monthly maintenance medications – The prescription copays you pay in the PPO80 and PPO90 plans aren’t applied towards your deductible or out of pocket maximum—so there’s no limit to how much you’ll pay. In the MyHSA plan, they are capped since what you pay is applied to the medical/prescription deductible and out-of pocket maximums. You want to save for medical expenses in retirement – An HSA is a great way to do so! Remember, you must: Be comfortable with risk – Although you won’t have premiums, you may have high expenses if there are claims – up to $3,000 individual or $6,000 family, less DENSO’s contribution Be comfortable with keeping documentation organized – You’ll need to keep careful records in case of IRS audit.