High Deductible Health Plan/ Health Savings Account Presentation - - PowerPoint PPT Presentation

High Deductible Health Plan/ Health Savings Account Presentation

WHY CHANGE?

• Future plan structured so employees will think and

act differently  Promote prevention and getting “healthier”  Promotes consumerism

• Current plan cannot be sustained – inflation and

disease states compounding effect on cost for employees and Board

NEW MEDICAL PLAN EFFECTIVE JANUARY 1, 2015 HIGH DEDUCTIBLE HEALTH PLAN / HEALTH SAVINGS ACCOUNT

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• Pre-Tax Premiums
• All services and prescriptions

apply to the deductible, except preventive care which is covered at 100%.

• Once the deductible has been

met, copays for some services will apply until you reach your out-

• f-pocket maximum.
• Once the out-of-pocket maximum

has been met all services and prescription drugs are covered at 100%.

• In-network services and

prescription drugs are paid based

• n the carrier negotiated rates
• No co-insurance as long as you

stay in-network

• Remember, preventive care is

covered at 100%

• Pre-Tax Contributions
• Money rolls over year-to-year
• Earns interest
• You own this account – not a

“use it or lose it” account

• Account is portable

How does the High Deductible Health Plan and Health Savings Account work?

HDHP

Banking Institution Insurance Coverage

HSA

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In-Network Out-of-Network

Deductible – Non-Embedded $1,500/$3,000 $4,000/$8,000 Co-Insurance 100% 70%/30% Maximum Out-of-Pocket $3,500/$7,000 $5,000/$10,000 Lifetime Maximum Unlimited Unlimited Preventive Care Covered in Full Subject to Deductible Hospital – Inpatient/Outpatient Subject to Deductible Subject to Deductible Professional Services Subject to Deductible Subject to Deductible Physician Office Visit Copay – After deductible has been met $20 PCP/$40 Specialist Subject to Deductible Emergency Room Copay – After deductible has been met $150 $150 Urgent Care Copay – After deductible has been met $50 Subject to Deductible Prescription Drug Copay $10 / $30 / $50 Subject to Deductible Mail Order $30 / $90 / $150 Not Applicable All other medical benefits are subject to the deductible and co-insurance. Copays listed above apply to the

• ut-of-pocket maximum.

High Deductible Health Plan

Advantages of a High Deductible Health Plan

• Because it is important to get your routine

preventive screenings, Preventive Care is covered at 100%. These services include, but are not limited to the following services:

– Routine Physicals – Well Child Exams and Immunizations – Preventive Gynecological Exams – Preventive Mammograms – Women’s Preventive Care and Screenings – Preventive PSA Testing – Preventive Colonoscopy

What is a Health Savings Account

• A Health Savings Account (HSA) is a tax-favored account owned by the

employee used to pay for current and future qualified health care expenses.

• A Health Savings Account must be established in conjunction with a

“High Deductible Health Plan” (HDHP).

• Contributions into the account can be made by you and/or your
• employer. Dayton Public Schools will be contributing $750

into your account for Single coverage and $1,500 into your account for Family coverage.

Advantages of a Health Savings Account

• YOU own the account. If you change jobs, move to another state, retire…the

money stays with you.

• Health Savings Account (HSA) money accumulates tax- free and can be used

for current and future health care expenses (medical, dental and vision).

• You to determine how much money to deposit into your account (up to the IRS

annual maximum).

• Funds can be used to pay for expenses incurred by your spouse and

dependents, even if they are not covered under your plan.

• No “use it or lose it” rules. HSA funds accumulate from year to year.
• It is an interest bearing account.
• Once you reach certain account balances investment opportunities are

available.

Maximum Annual HSA Pre-tax Contributions for 2014

 2014 Allowable Pre-Tax Maximum Contribution Single: $3,300 Family: $6,550  Remember, the money in your HSA account rolls over from year to year.

Age 55 years and older catch up provision $1,000.00

Expenses that can be paid using your HSA

Below is a partial list of qualified medical expenses eligible for reimbursement under your HSA. For more detailed information, you can visit www.irs.gov/pub/irs-pdf/p502.pdf

• Childbirth classes
• COBRA premiums
• Contact lenses/solution
• Deductible expenses
• Dental treatment
• Eye exam/eyeglasses
• Health insurance premiums

(Retiree or while drawing unemployment)

• Hospital and Emergency

Room services

• Laboratory fees
• Medicare premiums
• Long Term Care premiums
• Orthodontia – Adult and Child
• Over-the-counter medications

(you must have a prescription from your physician)

• Physical therapy
• Radial keratotomy / Lasik

surgery

• Smoking treatment program
• Speech therapy
• Vaccines
• Weight loss programs

(Prescribed for illness)

Please note that although these expenses are allowed to be reimbursed under your HSA, they may not apply to your medical deductible. Only those services covered under the medical plan will reduce the deductible.

HSA Participation Eligibility

 You are not eligible to open the bank account if you are:

 enrolled in a ‘full purpose’ medical FSA (you may continue FSA dependent care)

 Note: a ‘limited purpose’ flexible spending account will be made available to those employees who open a Health Savings Account. The limited purpose FSA will cover dental and vision expenses only and therefore can be used in conjunction with a Health Savings Account.

 enrolled in “any” Medicare benefits (Part A, Part B and/or Part D)  enrolled in a non-high deductible health plan  claimed as a dependent on another person’s tax return

 You can not reimburse yourself for expenses incurred PRIOR to

• pening your HSA.

Keeping Receipts and Paying Bills

 No claims submission is required for an HSA  YOU MUST keep your own receipts as proof that your purchases were eligible expenses, in case of an IRS audit  If you use the money in this account for a non-qualified health expense you will pay a 20% penalty and tax. (At age 65, you can

use the money in the account for any purchase, however if it is used for a non-qualified health care expense, you will pay tax on the purchase.)

 You may use your HSA debit card or optional checks to pay medical bills or providers directly  You may save your bills for several years and pay yourself back in the future, once your account has grown in value, provided all receipts are dated since account opening date

Filing Your Taxes

 Substantiation that HSA expenditures were for qualifying expenses is between you and the IRS  Every participant fills out Form 8889  Bank provides Form 1099-SA (Distributions)  Employer provides contributions on W-2, Box 12  Bank also provides 5498 (Contributions)  Participant reports any non-allowable purchases and these increase taxable income on the 1040

How do I use my HSA at the doctor’s office?

• Show your insurance card so the claim is filed with the insurance
• carrier. The insurance carrier will process your claim, apply the

discounted rate and then credit your deductible. Your claims will be processed toward the deductible in the order in which they are received, not necessarily by the actual date-of-service.

• You will receive an Explanation of Benefits (EOB) from the insurance

carrier explaining how the claim was processed. Your physician’s

• ffice will receive this same information.
• You will also receive a bill from your physician showing the discounted

rate (negotiated by the insurance carrier) for your visit.

• Make sure your EOB and bill match before paying your physician, using

the money in your HSA (if you choose).

How do I use my HSA at the pharmacy?

• Show your insurance card to the pharmacist so the prescription

medication is credited toward your deductible and you receive the discounted rate.

• Your card will show co-pays are required after the deductible is met.
• The Pharmacist will enter your insurance carrier information and the

discounted carrier rate will automatically be calculated at the time you pick up your prescription.

• Pay for your prescription with your HSA Visa/MasterCard.

HDHP

Deductible – DPS will contribute $750 for Single coverage into your Health Savings Account $1,500 Out-of-Pocket Maximum $3,500 Co-Insurance (After Deductible) 100%

Preventive Care Covered in Full

• 1. Office Visits – 1 Visits

(1 visits to PCP – OB/GYN annual)

Amount you may owe: $0

Preventive Visit

• 2. Prescription Drugs

(4 prescriptions – generic birth control)

Amount you may owe: $0

Preventive medications

Total Out-of-Pocket Expense $0 (and you have $750 accumulated in your Health Savings Account)

Example – Healthy Employee Only Coverage

2014 HSA Maximum Contribution: $3,300 Single / $6,550 Family

HDHP

Deductible – DPS will contribute $750 for Single coverage into your Health Savings Account $1,500 Out-of-Pocket Maximum $3,500 Co-Insurance (After Deductible) 100%

Preventive Care Covered in Full

• 1. Office Visits – 3 Visits

(2 visits to PCP / 1 visit to Specialist)

Amount you may owe: $450

(PCP: $125 each / SPC: $200)

• 2. Prescription Drugs

(3 prescriptions at $100 each)

Amount you may owe: $300 Total Out-of-Pocket Expense $750 (Because DPS is depositing $750 into your health savings account, your total out-of- pocket expense would be $0)

Example - Employee Only Coverage

2014 HSA Maximum Contribution: $3,300 Single / $6,550 Family

HDHP

Deductible - DPS will contribute $1,500 for Family coverage into your Health Savings Account $3,000 Out-of-Pocket Maximum $7,000 Co-Insurance 100%

Preventive Care Covered in Full

• 1. Outpatient Surgery

($10,000 outpatient surgery – first

claim of the year)

Amount you may owe: $3,000 (applies to the deductible)

• 2. Office Visits

(4 Visits after outpatient surgery)

Amount you may owe: $80 ($20 PCP – applies to out-of-pocket maximum)

• 3. Prescription Drugs

(3 Tier 1 Prescriptions)

Amount you may owe: $30 (applies to the out-of-pocket maximum) Total Out-of-Pocket Expense

$3,110 (Because DPS is depositing $1,500 into your health savings account, your total out-of-pocket expense would be $1,610)

Example – Family Coverage

2014 HSA Maximum Contribution: $3,300 Single / $6,550 Family

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HDHP

Deductible – DPS will contribute $750 for Single coverage into your Health Savings Account $1,500 Out-of-Pocket Maximum $3,500 Co-Insurance (After Deductible) 100%

Preventive Care Covered in Full

• 1. Emergency Room

(1 Visit - $850 ea.) Amount you may owe: $850 (applies to deductible)

• 2. Urgent Care

(1 Visit - $75) Amount you may owe: $75 (applies to deductible)

• 3. Prescription Drugs

(1 prescription)

Amount you may owe: $500 (applies to deductible) Total Out-of-Pocket Expense $1,425 (Because DPS is depositing $750 into your health savings account, your total out-of-pocket expense would be $675)

Example - Employee Only Coverage

2014 HSA Maximum Contribution: $3,300 Single / $6,550 Family

HSA

Deductible - DPS will contribute $1,500 for Family Coverage into your Health Savings Account $3,000 Out-of-Pocket Maximum $7,000 Co-Insurance – After Deductible 100%

Preventive Care Covered in Full

• 1. Office Visits

(2 Visits @ $125 each)

Amount you may owe: $250 (applies to deductible)

• 2. In-Patient Hospital Stay

($20,000)

Amount you may owe: $2,750 (applies to deductible)

• 3. ER (2 Visits)

($850 each – ER Copay is $150 after

deductible has been met)

Amount you may owe: $300 (applies to out-of-pocket maximum)

• 4. Prescription Drugs

(1 prescription – Tier 3)

Amount you may owe: $50 (applies to out-of-pocket maximum) Total Out-of-Pocket Expense $3,350 (Because DPS is depositing $1,500 into your health savings account, your total out-of- pocket expense would be $1,850)

Example – Family Coverage

2014 HSA Maximum Contribution: $3,300 Single / $6,550 Family