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 +

How does the High Deductible Health Plan and Health Savings Account work? HSA HDHP • Pre-Tax Premiums • Pre-Tax Contributions • All services and prescriptions apply to the deductible, except • Money rolls over year-to-year preventive care which is covered at 100%. • Once the deductible has been • Earns interest met, copays for some services + will apply until you reach your out- of-pocket maximum. • You own this account – not a • Once the out-of-pocket maximum “use it or lose it” account has been met all services and prescription drugs are covered at 100%. • Account is portable • In-network services and prescription drugs are paid based on the carrier negotiated rates • No co-insurance as long as you stay in-network • Remember, preventive care is Banking Institution covered at 100% Insurance Coverage

High Deductible Health Plan 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 $20 PCP/$40 Specialist Subject to Deductible been met Emergency Room Copay – After deductible has $150 $150 been met 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 out-of-pocket maximum.

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 Long Term Care premiums o o COBRA premiums Orthodontia – Adult and Child o o Contact lenses/solution Over-the-counter medications o o (you must have a prescription from your Deductible expenses o physician) Dental treatment o Physical therapy o Eye exam/eyeglasses o Radial keratotomy / Lasik o Health insurance premiums o surgery (Retiree or while drawing Smoking treatment program unemployment) o Speech therapy Hospital and Emergency o o Vaccines Room services o Weight loss programs Laboratory fees o o (Prescribed for illness) Medicare premiums o 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 opening 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 office 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.

Example – Healthy Employee Only Coverage HDHP Deductible – DPS will contribute $1,500 $750 for Single coverage into your Health Savings Account $3,500 Out-of-Pocket Maximum Co-Insurance (After Deductible) 100% Preventive Care Covered in Full 1. Office Visits – 1 Visits Amount you may owe: $0 (1 visits to PCP – OB/GYN annual) Preventive Visit Amount you may owe : $0 2. Prescription Drugs (4 prescriptions – generic birth control) Preventive medications Total Out-of-Pocket Expense $0 (and you have $750 accumulated in your Health Savings Account) 2014 HSA Maximum Contribution: $3,300 Single / $6,550 Family