Las Vegas, NV (PRWEB) January 18, 2007
HSA Qualified Health Plans work by coupling a Qualified High Deductible Health Plan (Q-HDHP) with a Tax Advantaged Health Savings Account. The funds deposited to the HSA can be utilized to pay for Qualified Medical Expenses on a tax-free basis and balances roll over from year to year. The minimum Q-HDHP deductibles are $1,100 for single and $2,200 for family coverage. When coupled with 100% co-insurance plans they can significantly reduce the annual maximum out of pocket cash when compared with traditional Co-pay plans. This is especially true when discussing family plans where there may be deductibles for each family member. The Q-HDHP plans utilize family deductibles where one or multiple family members' medical costs go toward a single deductible.
"I can immediately think of five reasons how a Q-HDHP plan married with a Health Savings Account makes complete sense for the self-employed here in the state of Nevada," explained Jennifer Knox, president of Knox Associates. "When purchasing health insurance you either pay for services through higher monthly premiums/low co-payments or raise deductibles and pay for services as they are required. I am in favor of paying for services as they occur and placing the premium savings into an HSA."
Reason One - Q-HDHP's can reduce the insured's total liability when it comes to maximum out of pocket expenses. One of the more popular $500 deductible Nevada plans has an annual maximum out of pocket of $3,500 - for a family on this plan; the maximum out of pocket is $7,500. Also, once the maximum annual out of pocket is reached, the insured still pays co-pays for physician's office visits and prescription drugs. With a Q-HDHP, the more popular "single deductible" plans can offer maximum out of pockets as low as $1,100 for individuals and $2,200 for families. In addition, once the deductible is met all covered medical expenses are paid by the insurance carrier, including prescription drugs.
Reason Two - For the self-employed; health insurance premiums are 100% tax deductible. However, in order to deduct your qualified medical expenses they have to exceed 7.5% of the insured is Adjusted Gross Income (AGI). Because the funds deposited into the HSA are 100% tax deductible, the insured now gets first dollar tax deductibility of their qualified medical expenses. In addition to routine medical care; some examples of Qualified Medical Expenses are; Dental treatments, Eyeglasses, Fertility enhancement, Lodging, COBRA payment and LASIK Eye Surgery to name a few.
Reason Three - In 2006, in order to fully fund an HSA, the insured was required to have a Q-HDHP for the full year. Thanks to the 109th Congress and President Bush, this restriction has been eliminated. In 2007, a single person can now contribute up to $2,850 and a family can contribute up to $5,650, regardless of the deductible selected or when the insured obtained the Q-HDHP. Individuals who are 55 and older can make additional catch-up contributions of $800 to their HSA in 2007.
Reason Four - Nevada has over 120,000 self-employed individuals. The first few years of being self-employed are the most difficult when it comes to cash flow. The IRS is now allowing a one time "penalty free" funding of Health Savings Accounts by rolling funds from an IRA into an HSA. In order to avoid penalties, this must be a trustee-to-trustee transaction. This can free up as much as $470 in monthly cash flow for a family in their mid forties with two teenage children without compromising coverage in their first year of being enrolled in a Q-HDHP.
Reason Five - Many local banking institutions are now offering Health Savings Accounts. This makes it easier than ever for the self-employed to manage their Nevada Health Savings Account related finances. No longer does the insured have to use an HSA trustee that is located outside of the state of Nevada; making it painless to deposit and access funds that are necessary to pay for Qualified Medical Expenses.
For more information on Health Savings Account Qualified Health Plans for the Self Employed in Nevada go to http://www.SilverStateInsurance.com or call 702.656.5915 and speak to the Individual Sales Department of Knox Associates, LLC.
Knox Associates is a Las Vegas based insurance brokerage specializing in providing Health, Life and Disability insurance to Small Businesses and the Self-Employed. Knox Associates, established in 2003, is a dedicated team committed to providing personalized, five-star service.