Mert & Holly Kilpatrick on wed 31 dec 03
I read that the new Medicare prescription drug bill that
just passed in Congress includes a new Health Savings
Account (HSA) similar to MSA's but more people are eligible,
and it has some expanded features. I put that in Google and
the first site that came up has an explanation:
http://www.healthsavingsaccount-hsa.com/
It could be good if they become available. My sister had
the same experience as Cindi, she was interested in an MSA
but couldn't find anyone in the area selling it.
Holly
East Bangor, PA
Cindi Anderson" wrote:
> I also looked into MSA's. One problem is that they were
only set up for a
> few years then expired, but I seem to remember they may
have been renewed by
> Congress recently. But they were also hard to find
because they have to be
> managed by a trustee and few companies are in this
business. If anyone does
> find a good company for MSA's I would like to hear but I
couldn't find one
> in CA.
Stephani Stephenson on wed 31 dec 03
I echo Kathi's sentiments.
Most 'group' rates are experiencing same increases as individuals. One
tilemaker I know employs 15 people, provides coverage for employees,
experienced a 30% hike this year. Individual policies seeing similar
hikes.
Many groups searching for a resolution to problem. No one has found a
simple solution, or even a complex but effective solution . 'Group'
rates seem about as high as individual rates. Currently I purchase an
individual plan with an HMO . My rates go up every year.
David Henley has mentioned one approach which may work for self
employed, and something I intend to check out . Right now I am not
knowledgable about the details, i.e everything below is pretty much
heresay, as I remember it told to me, so you will need to verify .
This approach is two pronged
1. purchase a relatively inexpensive(whatever that means nowadays),
major medical plan, with a high deductible to cover major medical
expenses.
2. self employed people , find out more about Medical Savings
Accounts,( unfortunately , this is where I don't know the exact name of
the program or option). This is a federally approved way to deal with
money spent on medical expenses. NOTE*: There is an important
difference, I gather, between Medical Savings Accounts for self
employed and the Medical Savings Accounts you might be familiar with as
an employee . Also there may have been positive changes in regs on this
in last few years.
In the employee style accounts, you had to estimate your expenses for
the coming year and you had to 'use it or lose it' every single year.
If I understood David correctly, in this style of account:
A. the money deposited is deducted from income , so there is a tax
benefit,
B. the money is allowed to accumulate from year to year.
C. you can put this in an interest bearing account, I think...
D. This is the money you use to meet your deductible each year,
toward the major medical policy, as well as other non covered
expenses.
E. If you don't have many medical expenses that year , the money
simply carries over to next year and it stays in your hands.
F. If you have major expenses, once you meet the deductible, the major
medical policy kicks in.
For some self employed folks this sounds like a good option , though
of course there are regional and personal differences in resources and
needs.
Certainly worth researching if you are looking for options.
Stephani Stephenson
steph@alchemiestudio.com
Cindi Anderson on wed 31 dec 03
I concur that the costs are going up outrageously. We have had 30%
increases every 6 months.
Stephanie has good ideas but there are still problems with them... Of
course plans vary from state to state... But I found the high deductible
plans have problems like they don't cover prescription drugs. Which would
be OK for normal drugs, but what if you get some serious illness, they still
won't cover drugs and it could be hundreds of thousands of dollars in
prescriptions. What I really wanted when I went looking was "catastrophic
coverage", like they would cover everything over $5,000 or $10,000 or
something, but strangely enough that didn't exist.
I also looked into MSA's. One problem is that they were only set up for a
few years then expired, but I seem to remember they may have been renewed by
Congress recently. But they were also hard to find because they have to be
managed by a trustee and few companies are in this business. If anyone does
find a good company for MSA's I would like to hear but I couldn't find one
in CA. Also make sure you have access to the money when you might need it.
One guy from ClayArt told me he had money locked inside one and couldn't get
it out because now he was covered by his wife's plan, and he couldn't use
the MSA if he was covered by another plan. Something like that.
Cindi
Fremont, CA
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