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Health Insurance

Open Enrollment is Now

By | 2018, Money Moxie | No Comments

Healthcare open enrollment is upon us. Here are some things to keep in mind.

1. Medicare Advantage Plans vs. Medigap Plans: Medicare Advantage plans wrap all of Medicare into one plan. Medigap, also known as Supplement Insurance, plans are separate from Medicare and help pay for medical care not covered under traditional Medicare. The premiums are charged in addition to Medicare Parts A, B, & D and are usually more expensive.

2. Take Advantage of a Health Savings Account (HSA) or Flexible Spending Account (FS). HSAs have higher contribution limits–$3,350/year for individuals and $6,750/year for families. The money in an HSA will roll over year after year; money not used in an FSA is forfeited. FSA contributions are limited to $2,650/year. To qualify for an HSA, you must be enrolled in a high-deductible health plan. Earnings and withdrawals are not taxed in either account as long they are used for qualified medical expenses.

Contributing to an HSA can be as advantageous as contributing to a retirement plan. Since the money in an HSA will roll over every year, you can use it in retirement to pay for eligible medical expenses.

3. Know the Dates of Open Enrollment! Affordable Care Act open enrollment is November 1st through December 15th. Employers often have their open enrollment around this time as well.

4. Take Advantage of Wellness Incentives. Health insurance providers often have incentives. They can be as simple as going to the doctor for a general health assessment. Incentives may include additional HSA contributions, lower premiums, or even gift cards.

5. Compare Costs: High-deductible plans have lower premiums, but out-of-pocket maximums increase with high medical expenses. Other plans with higher premiums may cover more expenses because of the lower deductible and maximums. Make sure you weigh the pros and cons of each plan.

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3 Medicare Minefields

By | 2016, Money Moxie, Newsletter | No Comments

Simple missteps when choosing your Medicare and Supplemental Plans can cost you greatly if you are not careful. Here are a few to watch out for:

1. Prescription drugs
When it comes to paying for your prescriptions, all plans are not equal. In fact, plans can change the lineup of drugs they cover each year.

According to Kaiser Family Foundation, your costs for a prescription may increase ten times between formulary and non formulary drugs. Screen the plans to see how much each insurer will pay for the drugs you are taking.

You can visit Medicare.gov (under drug coverage, find health & drug plans) to search for plans that offer coverage for the drugs you take. Make a point to compare your drug plan with others each year to assure you are getting the best bang for your buck.

2. Medigap coverage
Getting the right plan for your specific needs can be tricky. If you choose Original Medicare Part A, you need a Medigap or supplemental policy – Part B to pick up where Medicare coverage leaves off. You also need to choose a separate Part D – prescription drug plan.

You can simplify by choosing a Medicare Advantage Plan – Part C which combines all of the coverages together and handles all claim processing through one carrier.

Some Advantage Plans still require you to pick up a separate policy for prescription drug coverage. In 2016, 69 percent of enrollees went with Original Medicare Plans while 31 percent chose Medicare Advantage Plans.

Medicare Advantage Plans generally require you to use a specific list of doctors and medical facilities through either a Health Maintenance Organization (HMO) or Preferred Provider Organization (PPO).

When choosing an Advantage Plan check to make sure your favorite doctors and the facilities you most often visit are covered on the list of providers.

3. Important deadlines
Harsh financial penalties can be avoided by knowing your deadline dates. Failure to sign up during the enrollment period could mean your Part B premium may be 10 percent higher – for life – for each full year you are late signing up for Medicare Part B.

If you are 65 or older, still an active employee and covered under your employer’s health insurance plan you are not required to sign up at 65 unless your company has 20 or fewer employees. If this is the case, you may be required to sign up for Medicare Part A and Medicare Part B, which will become the primary payer when you have a claim and your employer’s plan will become the secondary payer.

Once the clock starts ticking, there is only a seven-month window to avoid permanent penalties. Call our office if you have questions regarding the deadlines or need more information about the requirements.

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Top Concern for Small Business Owners: Rising Health Insurance Costs

By | 2013, Money Moxie, Newsletter | No Comments

A recent study by the National Federation of Independent Business ranked “Cost of Health Insurance” the number one concern for small business owners.1 This comes as no surprise as there has been much uncertainty over the impact of the Affordable Care Act, AKA “ObamaCare.”

The Wall Street Journal reports that “while ObamaCare won’t take full effect until 2014, health insurance premiums in the individual market are already rising, and not just because of routine increases in medical costs. Insurers are adjusting premiums now in anticipation of the guaranteed-issue and community-rating mandates starting next year.”2 The largest impact will be for individual coverage, where health care costs in Utah are expected to increase somewhere between 65% and 100%.3 Small employers are also expected to feel a disparate impact. Large employers will be impacted the least.

Whether you supply health insurance for your small business employees or you get alone with individual coverage, you can expect premiums to increase.

While understanding that costs will most likely increase, we also need to remember that one of the benefits of ObamaCare is that many small business owners, employees, and individuals can gain access to healthcare where they didn’t have access before.

For small business owners, there are specific rules governing how your business will be impacted next year based on the number of employees you have. For example, if you have less than 25 employees, you may actually qualify for a tax credit if you contribute 50 percent or more toward employee health insurance. Employers with 25-50 employees will have access to SHOP, the Small Business Health Options Program,
where employers can go to find coverage from a selection of providers in the marketplace. Open enrollment begins October 1, 2013.

It isn’t until you have 50 full-time equivalent employees or more that you may be subject to an “employer shared responsibility payment” beginning in 2014. It is important to understand how all of these rules may impact you. For greater detail please visit SBA.gov and IRS.gov and search for the Affordable Care Act.

So, what should you be doing as a small business owner? First, make sure you understand all of the changes and how they will impact you going forward. Then, if you feel like the cost of your insurance is increasing dramatically, shop around. Smedley Financial Services has access to individual and small business health insurance plans. We can give you a second opinion to see if you can save money or if there is a different type of plan that is more suited to your business structure.

There are so many changes happening in health care that it is hard to keep up. However, with a little research and some expert advice you can remove some of the uncertainty in your life.

1. “Uncertainty Dominates Top 5 Small Business Concerns,” National Federation of Independent Business, http://www.nfib.com/research-foundation/priorities.
2. Merrill Mathews and Mark E. Litow, “ObamaCare’s Health Insurance Sticker Shock,” Wall Street Journal, January 13, 2013.
3. Merrill Mathews and Mark E. Litow, “ObamaCare’s Health Insurance Sticker Shock,” Wall Street Journal, January 13, 2013.

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