you are like most Americans, your employer supplies you with group health
insurance coverage. If you are responsible for obtaining your own
health insurance, it behooves you to become familiar with the subject.
plans fall into four basic categories: Health Maintenance
Organizations (HMOs), Preferred Provider Organizations (PPOs),
Point-of-Service plans (POSs), and Exclusive Provider Organizations (EPOs).
But there are also differences between plans of the same basic type (for
example, not all HMOs are the same), so be sure to read all your materials
and discuss your questions with us before selecting a plan.
health insurance is generally the most flexible type of health plan.
allows you to choose any doctor you want to and see specialists without
getting approval from a "primary care physician" or
"gatekeeper" first. However, depending on the plan, certain
restrictions may apply. For example, you may need to get the insurance
company's approval before checking into a hospital, unless it is an
With traditional health insurance, you will usually have to spend a
certain amount on medical bills each year before your insurance starts to
pay. This is called a deductible. After that, you will have to pay a
percentage of each charge, called a co-payment. The insurance company will
pay the rest of the charge based on what it considers reasonable. Many
insurance plans protect you from large medical expenses by limiting your
total expenses in any given year, called your maximum out-of-pocket
expenses. There may also be a cap on total benefits--a maximum amount the
insurance company will pay in your lifetime.
Health insurance companies are
regulated by the California
Department of Insurance.
are several types of HMOs. Most will only cover your expenses if you go to
a health care provider within their organization (unless it's an emergency
or you're out-of-town). They may require that you choose a primary care
physician who will coordinate your care. You wil probably have to get
approval from that physician before seeing a specialist. You must get
approval from the HMO before entering a hospital or receiving some other
kinds of non-emergency care.
HMOs do not require that you meet a deductible each year and require only
a small co-payment (for example, $5 per visit or prescription). Most of
the paperwork is handled by the organization.
HMOs are regulated by the
Department of Managed Health Care.
(Preferred Provider Organization)
are generally less flexible than traditional health insurance plans but
more flexible than HMOs. You can see any health care provider you want to
(including a specialist), but your co-payment will be higher if the
physician you choose is not a "preferred provider", that is, a
physician that the health plan has a contract with.
will almost always require that you get their approval before entering a
hospital. But they are more likely to cover checkups and other preventive
medical services than traditional health insurance plans, and most
preferred providers will file your claims for you.
POS plan is similar to an HMO in that you can see physicians within a
network and pay only a small co-payment. But you can also see physicians
that aren't in the network and pay a percentage of the charge, after
you've met your deductible, as you would with a PPO plan.
may be restrictions on the services you can receive outside the network
with a POS plan. For example, prescription drugs, organ transplants,
treatment for infertility, and mental health services may not be included.
(Exclusive Provider Organization)
EPO is similar to an HMO, except that it is regulated by the California
Department of Insurance and generally pays physicians and other healthcare
providers differently. EPOs will only cover your expenses if you see a
physician that is in the EPO's network, unless it is an emergency.
Which should you choose? If you care less about cost and more about
the ability to choose your own physician - stick with either an indemnity,
PPO or POS plan. Contrary to popular belief, HMO plans will be more expensive
due to the fact that you are pre-paying for your services.
Among managed-care plans, PPOs and POSs tend to spell slightly higher
out-of-pocket cost to you than HMOs. It's a simple trade-off: more
flexibility equals extra cost. So if you don't have any serious
medical conditions or you have your children and are likely to take them
in for lots of potentially costly checkups, an HMO may be your best
up Health Insurance Choices
HSA Medical Plans
What is a HSA?
An HSA is a personal savings account very similar to an Individual Retirement Account
(IRA) that gives you more control over how you save for and manage your
health care costs. It allows you to earn interest as you save for
qualified medical expenses on a tax-advantaged basis. The
difference being the money deposited into a HSA is used to pay for health
care expenses instead of providing retirement income as with an IRA.
Anyone that is covered by a Qualified High Deductible Health Plan (HDHP)
can qualify to open and contribute to a HSA.
What are the benefits of opening and contributing to a HSA?
HSA legislation created tax benefits that you can take advantage.
Deposits into and earnings from a HSA are tax deferred and can be
withdrawn tax-free and penalty-free to pay for qualified medical expenses.
What are some of the qualified medical expenses that can be paid from the
Qualified medical expenses are generally defined as costs associated with
the diagnosis, cure, treatment and/or prevention of an illness or
injury. This would include doctor office visits, medications (both
OTC and prescriptions), dental expenses (including orthodontia) and vision
expenses. It even covers eyeglasses, contact lenses and laser eye
surgery. You can even use the funds to pay long-term care insurance
premiums and in-vitro fertilization. Typically, funds cannot be used for cosmetic surgery,
however they can be used to pay for laser eye surgery.
What if I do not use all the money contributed to the HSA in the year.
Any remaining balance rolls over and accumulates to be available for
medical expenses in the future. If funds still remain at age 65 they
can be taken as penalty-free retirement income withdrawals.
What are my annual contribution limits?
2015 Maximum contribution for a single individual is $ 3,350 and $ 6,650
for a family.
Which companies offer HSA qualified health plans?
Aetna, Anthem Blue Cross, Assurant*, BlueCross BlueShield of Georgia*,
BlueCross BlueShield of Illinois*, Blue Shield of California, Celtic,
Cigna, CoventryOne, HealthNet, Humana, Kaiser, IHC Group*, Independence
Blue Cross*, LifeWise Health Plan of Washington*, Regence Blue Shield*,
Scott and White Health Plan*, UnitedHealth Care, WPS Health
Insurance*. * Outside California.
speak to your tax advisor to see if you are eligible for a Health Savings
a HSA plan comparison, please click on the following link. HSA
Strong Case for Health Savings Accounts
momentum continues as HSA's build popularity among the working
class. Its a good reason, since the tax advantaged HSA's generate
some impressive results over a long period of time. Here is an
example of how an HSA will cost less in the long run. The
Premiums on each plan increased 10% per year.
The deductible on the HSA plan would be 2,400 and this is the amount
contributed each year for 10 years.
The insured is in a 30% tax bracket.
HSA Plan 2,400
|| PPO Plan $ 40 Copay
Savings with HSA
Savings - Premium
Cost After Tax
Reimbursement Arrangement (HRA)
you select a High Deductible Health Plan and you are not eligible for an
HSA, you will be given an HRA. The health plan will credit a portion
of the health plan premium to your account. The amount for either a
Self Only enrollment or a Self and Family enrollment will be the same as
the amounts that will be deposited in HSAs in the same plan. You can
use funds in your account to help pay your health plan deductible and/or
qualified medical expenses that do not count toward the deductible.
You also can use the account to pay medicare premiums.
of an HRA include:
withdrawals for qualified medical expenses
of unused credits, without limit, from year to year
- Credits in
an HRA do not earn interest
- Credits in
an HRA are forfeited if you switch health plans, or if you leave
federal employment other than to retire
- Your HRA is
administered by the health plan
Medical Insurance Vs. Employer Paid Medical Insurance
individuals are unsure of the difference between individual and group
(employer paid) medical coverage. The main differences are as
Employer paid benefits can be cancelled and changed by your employer. No
Employer paid benefits can be cancelled and changed by the insurance
company. No Control.
Employer paid benefits usually cannot be continued upon termination of
employment. If you have developed a medical history your options usually
include COBRA which is for individuals who are unable to obtain individual
coverage or obtain new coverage through their new employer. COBRA
coverage is prohibitively more expensive than individual coverage.
If you are concerned about having control of your own medical insurance,
individual coverage is your best option. By keeping an individual plan
you will not have to rely on your employer and you will not have to go on a
COBRA plan when you leave your current place of employment. If you develop a
medical condition, you will not be without coverage. If you plan to move
out of California, contact us about plans with Nationwide Health.
is Eligible for Medicare?
Medicare is a
Health Insurance Program for:
- People 65
years of age and older.
- Some people
with disabilities under age 65.
- People with
End-Stage Renal Disease (permanent kidney failure requiring dialysis or
Medicare has Two
can choose different ways to get the services covered by Medicare. Depending
on where you live, you may have different choices. In most cases, when you
first get Medicare, you are in the Original Medicare Plan. You may want to
consider a Medicare Prescription Drug Plan to add drug coverage. Or, you may
want to consider a Medicare Advantage Plan (like an HMO or PPO) that provides
all your Part A, Part B, and often Part D coverage. You make a choice when you
are first eligible for Medicare. Each year you can review your health and
prescription needs and switch to a different plan in the fall.
long as you have both Part A and Part B, items covered by Part A and Part B
are covered whether you have the Original Medicare Plan, or you belong to a
Medicare Advantage Plan (like an HMO or PPO). For more information see the
Your Medicare Coverage database.
Part A (Hospital
in hospitals as an inpatient, critical access hospitals (small facilities that
give limited outpatient and inpatient services to people in rural areas),
skilled nursing facilities (not custodial or long-term care), hospice care,
and some home health care. Information about your coverage under Medicare Part
A can be found in the Your
Medicare Coverage database.
you arenít sure if you have Part A, look on your red, white, and blue
Medicare card. If you have Part A, ďHOSPITAL (PART A)Ē is printed on your
people get Part A automatically when they turn age 65. They do not have to pay
a monthly payment called a premium for Part A because they or a spouse paid
Medicare taxes while they were working.
If you donít
automatically get premium-free Part A, you may be able to buy it if
- you (or your
spouse) arenít entitled to Social Security because you didnít work or
didnít pay enough Medicare taxes while you worked and you are age 65 or
- you are
disabled but no longer get premium-free Part A because you returned to
you have limited income and resources, your state may help you pay for Part A
and/or Part B. For more information, visit www.socialsecurity.gov on the web
or call Social Security at 1-800-772-1213. TTY users should call
1-800-325-0778. If you get benefits from the Railroad Retirement Board, call
your local RRB office or 1-800-808-0772.
Part B (Medical
services, outpatient care, and other medical services that Part A doesn't.
Part B helps pay for these covered medical services and items when they are
medically necessary. Part B also covers some preventive services. Information
about your coverage under Medicare Part B can be found in the Your
January 1, 2007, your Part B premium will be based on your income. Most people
pay the standard monthly Part B premium of $ 99.00 in 2012. For more
information, see our FAQ: Medicare Part B Monthly Premiums in 2012.
some cases this amount may be higher if you did not choose Part B when you
first became eligible. The cost of Part B may go up 10% for each full 12-month
period that you could have had Part B but didn't sign up for it, except in
special cases. You may have to pay this penalty as long as you have Part B.
in Part B is your choice. You can sign up for Part B from three months before
you turn 65 to three months after you turn 65. To sign up, call the Social
Security Administration at 1-800-772-1213 or visit or call your local Social
Security office to sign up. If you choose to enroll in Medicare Part B, the
premium is usually taken out of your monthly Social Security, Railroad
Retirement, or Office of Personnel Management payment. In these cases, you
wonít get a bill for your premium. If you donít get any of these payments,
Medicare sends you a bill for your Medicare Part B premium every three months.
If you donít get your bill by the 10th of the month, call the Social
Security Administration at 1-800-772-1213. TTY users should call
1-800-325-0778. If you get benefits from the Railroad Retirement Board (RRB),
call your local RRB office or 1-800-808-0772.
More Information About Medicare Part B Coverage:
Visit the Your
Medicare Coverage database.
are eligible for Medicare if you or your spouse worked for at least 10 years
in Medicare-covered employment and you are 65 years or older and a citizen
or permanent resident of the United States. If you arenít yet 65, you
might also qualify for coverage if you have a disability or with End-Stage
Renal disease (permanent kidney failure requiring dialysis or transplant).
Here are some
simple guidelines. You can get Part A at age 65 without having to pay
- You already
get retirement benefits from Social Security or the Railroad Retirement
- You are
eligible to get Social Security or Railroad benefits but haven't yet
filed for them.
- You or your
spouse had Medicare-covered government employment.
If you are under
65, you can get Part A without having to pay premiums if you have:
Social Security or Railroad Retirement Board disability benefits for 24
Renal Disease and meet certain requirements.
you do not have to pay a premium for Part A if you meet one of these
conditions, you must pay for Part B if you want it. Starting January 1,
2007, the Part B premium will be based on your income. Most people pay the
standard monthly Part B premium of $ 99.00 in 2012. For more information, see
our FAQ: Medicare Part B Monthly Premiums in 2012.
Part B monthly premium
You will be eligible for Medicare when you turn 65 even if you aren't
eligible for Social Security retirement benefits. For more information,
please visit our retirement
For more information about eligibility for Medicare, call the Social
Security Administration at 1-800-772-1213 or visit your local Social
Security Office. TTY users should call 1-800-325-0778.
If you would like
more information, call (800)
501-8078 or E-Mail us at Kaplanmanangement.net
All information is confidential.