06/21/2004
Are you looking for health-care options? Need help deciphering the morass of acronyms, regulations and manuals that complicate the health-care picture? Want to see if there's a way for you to save on health care?
Delegates of the 2004 NFIB National Small Business Summit learned about new options to lower health-care costs for themselves, their employees and their families during two breakout sessions titled “Understanding the New Health-Care Marketplace.” You can learn the same tips they did.
AHPs
For several years, small-business advocates have been working to pass national Small-Business Health Plan legislation, also known as AHPs. If enacted, the proposal would allow small-business owners to band together across state lines through their membership in a bona fide trade association to purchase health coverage for their families and employees. NFIB has been front-and-center in the fight for AHPs. The House has passed AHP legislation seven times, but the Senate has never acted. You can help in two ways right now:
Contact your senators and ask them to support AHPs.
HSAs
But you don't have to wait for AHPs to be enacted to explore new options. At the summit, delegates also learned about the benefits of the newly enacted Health Savings Accounts (HSAs), how they work and how to get started.
In effect since Jan. 1, 2004, HSAs are tax-free savings accounts for medical expenses that may allow more small-business owners to obtain affordable health coverage for themselves and their employees. Any taxpayer with a high-deductible health insurance plan can contribute up to $2,600 a year ($5,150 for families) into an HSA account.
Roy Ramthun, senior adviser on health initiatives at the Treasury Department, provided an overview of HSAs, including eligibility requirements, contribution rules and the advantages of HSAs.
Todd Page, account manager with the J.L. Barnes Group, dispelled myths about HSAs and offered advice to small-business owners on how to start taking advantage of HSAs today.
What consumers don’t understand, Page said, is that they’re playing the copay game, to their detriment. “You pay $120 a month to be able to pay $20 to the doctor,” he said. “With an HSA, you buy the insurance you need.”
To take best advantage of an HSA, you should seek an insurance plan with no copayments, according to Page. Your premiums will be lower, because the insurance company won't pay anything until you reach your deductible. Under a copay plan, insurance companies pay every time you go to the doctor. With a non-copay plan, many people may never reach the deductible, allowing the insurance company to pass their savings on to you in reduced premiums. The HSA comes into play by allowing you to cover many, or perhaps all, of your expenses up to the deductible.
According to Page, HSAs trim the fat, allowing holders to save an average of 35 to 50 percent off their health-care costs. “People who buy HSAs, 90 percent of the time, end up with lower out-of-pocket costs,” he said.
Page says that small-business owners interested in opening an HSA need to make the first move. Because HSAs are commission-free, there is little incentive for insurance agents to introduce the concept to their clients. If you make the first move, Page said, chances are they will be willing to help out.
NFIB offers Health Savings Accounts to its members through NFIB HealthBenefits and Assurant. For more information, see the link at the right.
