Health Savings Account Basics
Health Savings Accounts are a
popular strategy in the Small
Business sector to provide a
flexible alternative to standard
fare health plans. It has been
the fastest growing sector for
health benefit products
recently. The combination of
high deductible health insurance
plans reducing monthly premiums
and tax favored employee
accounts offering flexibility
for coverage on minor expenses
has been quite attractive.
Successful Health Savings
Account Implementations have the
following attributes:
-Employer
Contributions It is
important for you to establish
an Employee health savings
account contribution schedule
and stick to it. There’s no
better recipe for failure than
handing your employees a high
deductible health plan with
practically all the benefits
expensed out of pocket towards
the deductible. Your
employees will need protection
against the deductible they
face- particularly since they
most likely are coming from a
traditional health insurance
plan, whether it be an HMO or
PPO, where there are co-pays for
medical expenses deductible
waived. You can read more in
our section on HSA
Contributions.
-Implementation Education
Health Savings Accounts will
most likely be a new experience
for your employees so it will be
important for you to educate,
educate, educate. Multiple
opportunities for your employees
to review and respond to the HSA
opportunity presented will make
for happy employees. Review
sessions are also important,
following up ensuring everyone
is clear on questions and
implementation. The concept it
pretty straightforward once the
staff has had some time to
familiarize and utilize.
-Collateral Providing
customized collateral concise to
your company’s rollout will
alleviate nervous and confused
minds. The simpler the better
but it should show clear
examples of the specific plan
you are implementing so the
deductible, premium, and account
contribution numbers match the
real implementation.
-Roll Over There are a
number of new laws which allow a
one-time Flexible Medical
Spending account rollover,
Health Reimbursement rollover,
and IRA account transfer to the
HSA account.
-Employee
Contribution
Your employees should also be
informed of their options to
contribute personal funds to the
Health Savings Account. The
account after all belongs to the
Employee. Funds’ remaining in
the account stay with the
employee even after the employee
terminates employment. The
employee then begins to
understand healthcare isn’t free
as they see the transactions
first hand process from Provider
to Insurer back to Member.
Knowledgeable Health Savings
Account Administrator Nothing
ruins your day than calling your
HSA administrator and not
getting any answers to your
questions. In the beginning,
when Health Savings Accounts
were first launched as a
congressional pilot program, the
first few Health Savings Account
Administrators were small in
number and large in expertise.
This was mainly because as a
pilot program it had to
continually pass re-approval
status in Congress so large
financial instituations did not
quickly jump to offer the
accounts. Now that the
popularity of Health Savings
Accounts for Small Groups is
staggering the largest financial
institutions in the country have
jumped on board to offer them.
The downside of opening your HSA
account at your conglomerate
bank is potentially finding
someone with expertise on tax
and contribution questions can
be difficult.
Other
important
resources:
California
Small Group
health quote
California
Small Group
online
doctor
listing
California
Group
Enrollment
and
Eligibility
Center
