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Article added: 08/01/2006
Top Ten Reasons to Have an HSA
- Contributions are tax deductible
- Money you put in grows tax-free
- Withdraw money any time for expenses not covered by health insurance, which may include:
- Doctor's office or hospital visits
- Glasses
- Dental work
- Long-term care insurance premiums
- Over-the-counter drugs
- HSA's are permanent
- Nearly everyone qualifies
- Tax-deductible contributions are allowed up to the minimum of a qualified health insurance plan deductible
- Excess funds may be rolled over into a traditional IRA
- Roll-overs from an MSA are permitted, tax-free
- If you have an HSA, expenses for family members can be paid for even if they are not on your health insurance
- HSA's finally make health care affordable!
Posted on Fri, Mar. 24, 2006
Health benefits, tax ramifications only two of the considerations
Buyouts can be study in complexity
By GENE MEYER
The Kansas City Star
An early retirement buyout offer can trigger some of the most complicated and important decisions that workers can make.
'It's definitely not a windfall,' said Stewart Koesten, a certified financial planner and president of Koesten Hirschmann & Crabtree Inc. in Overland Park.
'What's being measured is the difference between what someone is giving up for the rest of their life and what they are getting in return.'
General Motors Corp.'s offer to its workers '' essentially to swap gold-plated health and pension benefits for single shots of taxable income up to $140,000 '' illustrates the complexity.
Workers who take the money will need some of the money to pay taxes, some of it to live on, some to invest for the future and some to replace health insurance benefits. How much will vary, depending on differences as wide as how well a working spouse's health plan might cover family members to how far rainy day funds can be stretched until new income is found.
Even so, taxes and health insurance are two of the biggest issues most workers must sweat when considering a buyout offer.
Buyouts essentially are severance packages, which are taxed at the same rate as regular paychecks. Lump sums are included in taxpayers' incomes the year they are received.
At the least, a worker taking $140,000 might be bumped upward a tax bracket or two, said Jackie Perlman, senior tax research coordinator at H&R Block Inc. in Kansas City.
I don't see how any of (the buyout money) can be excluded from taxable income,' Perlman said.
Some workers also could face the alternative minimum tax. The AMT can peel away home mortgage and other deductions along with many personal and dependent exemptions for heavily itemizing taxpayers with as little as $75,000 in income.
Replacing health benefits also is tricky and usually costs more.
A Kansas City family of four, generously covered by GM's plan now, probably would pay $500 a month if they bought a traditional middle-of-the-road plan, said Bob Brow, an Indianapolis insurance broker and owner of the online comparison service Health Quotes USA.
Short Term Medicalsm bridges the gaps in coverage between jobs, and or recent graduates, students not covered by parents plans, early retirees
INDIANAPOLIS (March 14, 2006) As a nurse, Sandra D'Annunzio of Sterling Heights,Michigan knows just how costly medical care can be. That's why the working mother turned to Golden Rule short term health insurance for her two young adult daughters who were no longer eligible for coverage under her plan. 'It's all about peace of mind,' D'Annunzio said. 'Injury and illness can happen to anyone at any age. No one is immune.'
Golden Rule Insurance Company, a UnitedHealthcare company and leader in the individual insurance market for 60 years, today introduced its newest generation Short Term Medical plan to fill in gaps in coverage for individuals and families in times of transition and change. With Golden Rule's new Short Term Medical, consumers can opt for one to six months of coverage and also choose from a range of deductibles and payment options that best meets their individual needs. Customers also have the flexibility to drop the plans at any time without penalty or to apply for another one to six months of coverage.
In addition, UnitedHealthcare's comprehensive national network of health care professional and facilities provides substantial discounts on medical services. 'We designed an affordable, easy-to-understand plan with a simple, quick application process because we know that life circumstances change,' Golden Rule CEO Rich Collins said. 'Peace of mind comes from knowing that you and your family are protected regardless of your temporary situation.'
Independent insurance broker Bob Brow of Health Quotes USA, who recommended Golden Rule Short Term Medical to D'Annunzio, agrees. 'Anyone can break a leg or have a medical emergency and suddenly be facing $10,000 in bills,' he explained. 'This can be financially devastating to someone just out of school or in between jobs, especially when you realize that affordable temporary health insurance was available.'
Brow, who's based in Zionsville, Indiana, but is licensed to offer health insurance in 20 states, said that 20 percent of his customers have purchased temporary health insurance. He recommends short term plans to recent graduates looking for work or students dropping off their parents plans, workers between jobs who find COBRA coverage too costly, early retirees waiting for Medicare eligibility and others whose lives are in times of transition.
As UnitedHealthcare's individual insurance provider, Golden Rule offers health savings account (HSA) plans, other high deductible plans and traditional copay plans in addition to Short Term Medical. 'Saver' options within many of the plans feature Golden Rule's lowest premiums for consumers who previously thought they couldn't afford health insurance.
Golden Rule helped pioneer the HSA which combines a high deductible insurance plan with a tax-favored savings account. Golden Rule customers typically save 45 to 55 percent or more in premiums by choosing a health savings account plan over a more traditional plan. In addition, HSA's offer triple tax advantages: the savings are tax deductible when deposited, grow tax deferred and can be withdrawn tax free as long as they are used for qualified medical expenses including vision and dental.
Today, 40 percent of health plans purchased from Golden Rule throughout the country are HSA's and its customers have accumulated more than $155 million in their tax-advantaged savings accounts. Golden Rule currently does health insurance business in 28 states and is rated 'A' (Excellent) by A.M. Best, and 'A+' (Strong) by Standard & Poor's, independent rankings that indicate financial strength and stability. In addition, for eight consecutive years, Golden Rule has been ranked by Ward Group as one of the 50 Life-Health top-performing companies that have done the best job of balancing financial safety, consistency, and performance over the past five years.
For more information about Golden Rule Short Term Medical and other quality health insurance plans, consumers can call 1-800-388-0102 or visit www.healthquotesusa.com.
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