You would think that with the sky high price of Employee Benefits, especially Group Health Insurance, that employers would be shying away from offering it to their employees. Not at all the case. In fact, to attract and retain employees, many #employers are increasing their Benefits offering to compete. A fantastic way to help with the cost of Group Insurance is having plans with an HSA component attached. Simply having a High Deductible Health Plan (HDHP) is not enough…the plan has got to be HSA compatible. That means that not only does it have to be High Deductible, but have other parts of the insurance fit the #HSA model.
Think of an HSA as a “Medical IRA” and use it as such
One of the benefits of having an HSA, is that you can bank thousands of dollars each year, pre-taxed, to use on almost everything Health, Dental, Vision, Chiropractic, Hearing, Prescriptions, and a ton of other things. Unlike an FSA, you can bank way more money and roll it over year to year, without a penalty with an HSA. The downside to having an HSA compatible Health Plan is that most times, you have to pay everything before your deductible is satisfied (at the negotiated rate of course), which can be costly….especially if you don’t have the funds in the HSA account yet.
HSAs are not for everyone
If you have the money to fund the account, month after month, even a little bit, it can really add up. Used judiciously, many people I know (including me), have thousands in their HSA account. Once accumulated, now if you have a big expense, its not such a big hit, financially. This is especially attractive for employers offering to either fund some of the employee’s HSA accounts, or purchase products that help pay for expenses incurred when they DO happen. I like to call this “underfunding” the High Deductible Health Plans. It is super effective if you have discipline and you’ve gotten the education from the Health Broker on HSA strategies. Without these two pieces, it probably will not work for you.
Steve Brauer-Principal, Brauer Insurance Services. We specialize in Group Health Plans for employers with under 100 employees all over the state of CA. www.brauerinsurance.com