| Many people get health coverage
through their employer, this is called group coverage. Employers
usually offer several types of coverage to choose from, and
employees get a chance to change their coverage once a year during
open enrollment. The three most common types of health plans are
health maintenance organizations (HMOs), preferred provider
organization insurance plans (PPOs) and high deductible health plans
(HDHP) which are qualified to also have a health savings account (HSA).
HMO:
- When you sign up, you select a primary care physician (PCP)
from a network of doctors.
- Your PCP is your first point of contact for most of your basic
health care needs.
- Women can also select an OB/GYN for obstetrical and
gynecological care.
- If you need special tests or need to see a specialist, your
PCP will give you a referral to see another doctor
PPOs:
Like HMOs, PPOs often feature a network of doctors, specialists
and hospitals; however, there are some key differences between the
plans.
- With a PPO insurance plan, you don't have to choose a primary
care physician.
- You have the option of receiving care from doctors, hospitals
and specialists in the network or outside the network, and you
don't always need a referral to see a specialist. Stay in-network
to keep your out of pocket medical expenses as low as possible.
HSA qualified plans:
A High Deductible
Health Plan (HDHP) is a health insurance plan that contains certain
requirements with respect to deductibles and out-of-pocket expenses
that qualifies the policyholder to open and contribute to a Health
Savings Account (HSA).
A
Health Savings Account (HSA) is a tax-favored account used in
conjunction with an HSA-compatible health plan or HDHP. The HSA
allows you to contribute funds on a pre-tax or tax-deductible basis,
which you may use to pay for eligible medical expenses.
-
HSA contributions are
tax-free or tax-deductible
-
No use it or lose it, its your money
-
You’re in control. You
choose when to use your HSA or pay out-of-pocket.
-
After age 65, HSA funds
can be used for non-qualified expenses and only income tax is
assessed
-
Withdrawals are tax-free
when used to pay for qualified medical expenses
-
Earnings grow
tax-deferred
Health Savings Accounts (HSA) have tax and legal
ramifications. AMG Insurance Agency and Health Plan Finders does not
provide legal or tax advice, and nothing herein should be construed
as legal or tax advice. These materials, and any tax-related
statements in them, are not intended or written to be used, and
cannot be used or relied on, for the purpose of avoiding tax
penalties. Tax-related statements, if any, may have been written in
connection with the promotion or marketing of the transaction(s) or
matter(s) addressed by these materials. You should seek advice based
on your particular circumstances from an independent tax advisor
regarding the tax consequences of specific health insurance plans or
products. |
