Business Owners Resource Network

February 26, 2009

A Basic Overview of Health Savings Accounts

Filed under: Employee Benefits — michellehodges @ 8:01 pm

I have found another wonderful article on HSA’s.   Consumer Driven Health Plans is a phrase you may have already heard and if not, will be hearing about in the near future.   HSA’s are for individuals as well as employee group plans.  Hope you find this information helpful and interesting!  Please contact me at mhodges@benefitsdesigngroup.cc or  913-262-0600 .  Thank you, Michelle Hodges

 

A Basic Overview of Health Savings Accounts Health Savings Accounts are becoming more of a need these days than a luxury. You must be enrolled in a high deductible health insurance plan in order to qualify for a Health Savings Account (HSA). Since Health Savings Accounts have been around, millions of people have qualified and gotten one. The trend should only continue to raise as more and more employers and companies offer this benefit as a bonus to their medical plans. Some companies aren’t quite there yet but many have jumped on the bandwagon. There are some basic rules that can help an individual or corporation decide to enter the HSA market:

To establish an HSA, there are some rules and regulations. It is like establishing an individual retirement account (IRA) in most cases. In fact the documents are very similar and the procedure as well. An HSA trustee (or HSA Administrator) can add terms to their agreement regarding the effecting policy and procedure of their HSA. These terms can include any of the following but that may not be all that is required. Included in your agreement could be definitions, fees and expenses, amendments, disqualifying provisions, investment options, distributions, transfers and rollovers, reports and records, termination and/or resignation, and liability protection. There might be more of less of these conditions depending on the insurer.

HSA eligibility requires you to have an Internal Revenue Code to even desire to be eligible. You must be enrolled in a high-deductible medical care plan. So, people who don’t pay a deductible or it is very low, do not qualify for this benefit. Some exemptions do apply of course but you would need to contact the right person to find out. You must not be able to be claimed as a dependent for anyone else or on Medicare. To qualify your deductible needs to be for an individual a minimum or $1150, and your out of pocket expenses can’t exceed $5,800 for that year. For a family, the deductible needs to be a minimum of $2300 and the out of pocket portion can’t exceed $11,600 per year. There is a cost of living deduction as well and your agent to better save you money will adjust things. Many organizations require that you prove you are eligible prior to a contract. It is the individual asking for the HSA that must figure out that they qualify or might qualify.

The yearly contribution can’t exceed the deductible amount or combination with out of pocket expenses. As long as the individual has the high-deductible health plan they are qualifying. If you lose this plan, you will not be eligible for that month or period of time. If you are married and have separate high-deductible health plan, it is the lowest deductible amount that the family as a whole can meet. There are no combining deductibles to get a higher benefit. If you qualify, you can establish a regular contribution, a rollover contribution, or a transfer contribution plan. For the money to be deductible for a specific tax year, one must file by the deadline to receive the benefits. If an eligible individual’s employer contributes to his or her HSA, the employer, not the HSA owner, is entitled to a deduction.

An HSA administrator or trustee reports the contributions on IRS Form 5498-SA, HSA, Archer MSA, or Medicare Choice MSA Information. Copies of the report are due to each participant and the IRS by May 31 of each year. The owner is responsible for reporting the contribution amount on the proper forms to be submitted and file them with the income taxes that year. The distributions are to be made by the owner, if different than the participant. These will tax-free if used to pay for, or reimburse qualifying medical expenses that occurred after putting the plan into effect. These expenses include and could exceed the diagnosis, cure, treatment, or prevention of disease, prescription and certain nonprescription drugs, and transportation and certain lodging costs primarily for and essential to qualified medical care and certain qualified long-term care services. It is an HSA owner’s responsibility to determine the taxability of an HSA distribution and whether it is legitimate. The guidance of a tax or legal professional may be necessary to determine whether an expense is a qualified medical expense to avoid penalties.

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February 24, 2009

Supplemental Health Insurance

Filed under: Employee Benefits,Financial Services — michellehodges @ 11:09 pm

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In today’s world of rising health insurance premiums, I often have employers ask me how to help provide their employees with benefits but at the same time help them to contain costs.  Let’s face it, right now we all need to look at opportunities to get the best bang for our buck.  In the health insurance arena…one brillant way is to make available  supplemental insurance  policies to your employee benefit package such as Aflac and Colonial.  Here’s some more information to give you an overview of just what supplemental insurance is…

How Does a Supplemental Health Insurance Plan like Aflac and Colonial Work?

Supplemental insurance, such as what Aflac and Colonial offers, pays a cash benefit to the insured. The amount of cash and how it is paid out depends on the supplemental health insurance plan or policy. Some popular supplemental health insurance policies are specific disease insurance such as for cancer, accidental death and dismemberment insurance or accident health insurance, and hospital indemnity insurance.

Determine Your Need for Supplemental Health Insurance

Since you already have health insurance do you need any of these supplemental health insurance plans offered by Aflac and other insurance companies? Well, that depends on your risk factors and how much insurance you want to carry or can afford to carry and how much savings you have put back.

First, Obtain a Good Health Insurance Policy

Of course, the first thing you want to have is a good health insurance policy. A good health insurance policy will pay for your health insurance bills just fine. Supplemental health insurance comes in to help you pay for what your health insurance does not pay or other expenses you cannot pay if something should happen where you temporarily or permanently cannot make an income to pay your bills.

What to Consider when Choosing Supplemental Health Insurance

Only you can decide if a supplemental health insurance plan is right for you. Some things to consider when deciding if you need a supplemental health insurance plan are your health risk factors, your savings, and how much insurance you can afford. Of course no one can predict what their health will be in the future, but if you have always been in good health and take good care of yourself then you would be less likely to use a supplemental health insurance policy than someone who is often in bad health. Also, your savings should play an important role in your decision to purchase a supplemental health insurance policy. If you were in the hospital for a few weeks or more, would you have enough to cover your other expenses that your insurance would not? And, when deciding on purchasing a policy, you need to take into consideration if you can afford it or not. Supplemental health insurance policies are not often used so it is not worth it to you to purchase a policy that you probably will not use if it would be a financial burden.

Let’s now take a closer look at the three most common supplemental health insurance policies:

1. Disease Specific Insurance: This type of supplemental health insurance provides a cash benefit paid directly to you if you require treatment for a specific disease such as cancer. Usually the benefit is paid per day or per procedure. There is a usually a minimum daily benefit and a policy maximum. The cash can be spent in any way you would choose and getting your benefit would have nothing to do with how much your insurance paid for your medical costs.

2. Accident Health Insurance or Accidental Death and Dismemberment Supplemental Insurance: This type of supplemental insurance typically would reimburse you for medical costs resulting from accidents. Benefits are paid if you die (to your beneficiaries) or are disabled due to a specific accident outlined in the policy. Premiums are usually low and no medical exam is required. Accidents can include car accidents and accidents in the home or at your job. Also, if you loose limbs, fingers, toes, or your vision due to a covered accident, you may be able to collect a percentage of the death benefit.

3. Hospital Indemnity Insurance: This type of supplemental health insurance provides a daily, weekly, or monthly cash benefit if you are confined to a hospital stay. Usually there is a minimum hospital stay before benefits are paid. The cash benefit is paid in addition to any other insurance you may have. Benefits are usually reduced if you are confined to a mental hospital and often you can find plans through an employer that require no health exam.

Next week I’ll talk about how integrating supplemental insurance with a high deductible health plan makes perfect sense!

You can reach me at:

Michelle Hodges

Benefits Design Group

mhodges@benefitsdesigngroup.cc

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February 23, 2009

Health Savings Accounts…FAQ’s

Filed under: Employee Benefits — michellehodges @ 8:06 pm

With HSA’s being such a buzz word in the healthcare industry, I often have clients asking the same basic questions.   Here you will find some answers to some of the most common questions asked…

What is a Health Savings Account (“HSA”)?
A Health Savings Account is an alternative to traditional health insurance; it is a savings product that offers a different way for consumers to pay for their health care. HSAs enable you to pay for current health expenses and save for future qualified medical and retiree health expenses on a tax-free basis.

You must be covered by a High Deductible Health Plan (HDHP) to be able to take advantage of HSAs. An HDHP generally costs less than what traditional health care coverage costs, so the money that you save on insurance can therefore be put into the Health Savings Account.

You own and you control the money in your HSA. Decisions on how to spend the money are made by you without relying on a third party or a health insurer. You will also decide what types of investments to make with the money in the account in order to make it grow.

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What Is a “High Deductible Health Plan” (HDHP)?
You must have an HDHP if you want to open an HSA. Sometimes referred to as a “catastrophic” health insurance plan, an HDHP is an inexpensive health insurance plan that generally doesn’t pay for the first several thousand dollars of health care expenses (i.e., your “deductible”) but will generally cover you after that. Of course, your HSA is available to help you pay for the expenses your plan does not cover.

For 2008, in order to qualify to open an HSA, your HDHP minimum deductible must be at least $1,100 (self-only coverage) or $2,200 (family coverage). The annual out-of-pocket (including deductibles and co-pays) for 2008 cannot exceed $5,600 (self-only coverage) or $11,200 (family coverage). HDHPs can have first dollar coverage (no deductible) for preventive care and apply higher out-of-pocket limits (and copays & coinsurance) for non-network services.

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How can I get a Health Savings Account?
Consumers can sign up for HSAs with banks, credit unions, insurance companies and other approved companies. Your employer may also set up a plan for employees as well.

How much does an HSA cost?
An HSA is not something you purchase; it’s a savings account into which you can deposit money on a tax-preferred basis. The only product you purchase with an HSA is a High Deductible Health Plan, an inexpensive plan that will cover you should your medical expenses exceed the funds you have in your HSA. However, HSA trustees often will charge fees for their services.

For more information,  I can be contacted at:

Michelle Hodges

Mhodges@benefitsdesigngroup.cc

913-262-0600

From www.ustreas.gov

 

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The First Step in Buying a Business

Filed under: Business Brokers,Business Valuations — alieser @ 3:58 pm

With layoffs and unemployment rates on the rise, many people are considering using their severance package to purchase a business.  Most, however, do not know where to begin the process.  They make an assumption that, similar to home buying, their first step should be a visit to the bank for loan pre-qualification.  In reality, lenders will consider both the buyer’s financial needs and capabilities and the financial strength of the business that they wish to purchase prior to making a loan commitment.  Therefore, most banks will want a buyer to have their business search narrowed to a particular business with an accepted offer on the table before they will qualify the buyer for a loan.

 

So, how do you begin the process of buying a business?  As a business broker, I meet with many first time buyers who have been searching the internet for businesses for sale, but are so confused by terminology and pricing that they fail to inquire for months or even years.  An initial no-obligation visit with a business broker can clarify a number of issues for a potential buyer, such as the size of business that you should be contemplating based upon your available down payment and income needs, what you should anticipate from a financing prospective, what “cash flow” means, and how “cash flow” is used to determine the value of a business.  This initial meeting will frequently conclude with a potential buyer completing a non-disclosure agreement (NDA) which will then allow the business broker to share information on any particular business listings that meet the buyer’s criteria.  Though business brokers are most often hired by the seller with the seller paying any broker’s fees, brokers typically are only paid when the business is sold.  Therefore, it is in the best interest of the broker and the seller for the broker to assist the often-nervous novice buyer throughout the process so that everyone is comfortable with the transaction, significantly increasing the probability of a successful transaction.

 

If you are interested in exploring the possibility of buying a business, pick-up the phone and set an appointment with a business broker.  This one hour investment of your time could save you months of “spinning your wheels” and could significantly streamline your road to entrepreneurship.

 

Anita Lieser, Senior Business Broker

913-433-2306

Sunbelt Business Advisors

7101 College Blvd. Suite 1650   Overland Park, KS  66210

February 18, 2009

A Prescription for Wellness; HSA’s

Filed under: Employee Benefits — michellehodges @ 11:02 pm

Health Savings Accounts or HSA’s as you might have heard them called…Scary, maybe at first until you grasp the fundamental concepts.  HSA’s allow you to set up a tax-deductible account to pay for medical expenses that are not covered by your health insurance.   For example you can use your HSA funds to pay for your glasses, contacts, dental needs, some over the counter medication, etc.  And since few health insurance plans cover expenses like homeopathy, acupuncture, or chinese medicine many Americans are paying for these alternative therapies out of their own pocket.  With an HSA, these expenses are 100% tax deductible when paid for through a health savings account. 

Humana has put together a great little video on YouTube…check it out!

February 17, 2009

Stop Talking so fast.

Filed under: Business Insurance — natewatson @ 5:55 pm

Have you ever gotten a message like this?

“Hi this is Frank, I was referred to you by Jennie from accounting.  She said you would be the person to help solve my problem.  Please call me back at…

The next flurry of sounds and clicks is spoken so fast it sounds like it is in Swaheli?  You have to listen 17 times just to hear what the area code is. 

Why do we do this?  Why do we believe that people can understand our super-fast gibberish that we call numbers?  You would never leave the whole message this way.  I want to let you in on something, something I learned from getting those types of messages all the time. 

  • The phone number is the most important part of the message.  Not who you are or what you want.  the number.  so SLOW…D.O..W…N…. 

I see this a lot with insurance too.  You spend all this time figuring out what your new company’s name is, where you want your office to be, what you want to sell, and to whom, but when it comes to making sure your newest venture is covered for all the pitfalls of the world, people just hand someone a check.  Then down the road, when the insurance really counts, they have no idea what they have, how it works or even who to call.  They just bought the first policy they saw, or even worse, the cheapest policy they saw and assumed they were all the same. 

Insurance should be something you look at with your agent once a year.  Your business changes but your insurance doesn’t unless you change it.  If it has been 4 or 5 years since your last checkup, call your insurance agent, or better yet, get a new one.  One that understands your business and knows business change.  You need one that makes it a point to call upon you and ask what has changed.  

  • injured-blue-manAfter an accident, is the wrong time to find your not covered and worse yet, could have been for a few dollars more a month if only you would have known you weren’t covered. 

 

I understand there will always be a place for bottom rung, cheap-as-possible, no-agent insurance.   Just not covering your business.  If you remember only one thing, remember this:  This is more than your job.  This is your life.   Proctect what you have built by using a good, local insurance agent.  One that is going to help you pick up the pieces and put you back on the right track.  To get you building your business again.  To get you doing what you love again.  Don’t let one bad car wreck, one bad employee, or one bad widget end your dream.  Insurance exists to cover you for all of these things.  To help you.   We may cost a few dollars more, but I promise the good ones are worth it.  

What horror stories do you have about cheap insurance that wasn’t worth the savings?

Blog written by Nathan Watson.  Insuring Shawnee and all of Kansas City.  913.322.3388. 

“I help you get the insurance you think you already have.”

February 14, 2009

What is the lucky number?

Filed under: Financial Services — cresslinger @ 6:21 pm

images2In the spirit of yesterday…”Friday the 13th,”  the lucky number 13.  Lets talk about a question I get all the time from clients and potential clients.  “How much should I be saving/What is the lucky number?”  This is a relative question and requires a little more in depth questioning than just a generalized answer.  Each situation/person is different in the goals they set for themselves in the short term and long term.  Do you want the vacation home?  Travel?  Play golf all everyday?  All of these questions have an impact on how much would need to be saving to fund these lifestyle choices.  

My rule of thumb is to set aside at least 10% of your income.  Most people I talk with get overwhelmed with the idea that they need to save at least 10%, but do not take into consideration that it does not necessarily have to be all invested.  A lot of the times they are already doing that with contributions to their company 401K and personal savings accounts.  Ideally over time it should be a goal to increase that number to 20%.  

Everyone should be creating different buckets of money for certain goals that have different time horizons.  My next post we will discuss the different buckets and pros/cons of each.  

How much are you saving? 

Chad Esslinger, HighPointe Financial Group.  913-234-0307

February 11, 2009

Hired and Non-Owned Insurance

Filed under: Business Insurance — natewatson @ 5:02 pm

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I was doing an insurance review yesterday for a tile company that services KCK, Shawnee, and Overland Park.  I noticed the owner didn’t have the coverage called “Hired and Non-Owned Coverage” This was alarming to me because the owner said he had been with his insurance agent for over 5 years! and he had never even heard of the coverage. When I explained that Hired and Non-Owned coverage was for when he or his employees were doing work for the company in their own vehicles, he asked me why he needed that coverage as all his employees should have their own insurance. I explained that most insurance companies would NOT cover the vehicle if you were doing company business in it. It is the business’s responsibility.

Send an employee out to get lunch for the office, business’s responsibility. Send an employee to the bank, business’s responsibility.                                 Send an employee to get parts, business responsibility.

Even if they are in their own car!

He was shocked that his agent had never told him about his and that his business had a huge hole in the coverage. When I did a complete review of all of his insurance, personal and commercial, I found quite a few places where he thought he was covered but he was not. He was surprised at all the questions I had considering his former agent had only asked him what he sold and how much he paid his employees. He had never even spoken with his agent after the initial setup. Now, with his new policy through me, he is set. And we setup a time for next year that we can talk about how his business has changed and if his insurance needed to change with it.

This is what I do. I make sure all of my customers actually get the insurance they think they already have. If this is something you want for your company, call me, I would love to help. 

How has your business changed since you started?

Nathan Watson, Nationwide Insurance.  913-322-3388.  x-14.                         Get the insurance you think you already have.

February 8, 2009

Change, Change, Change

Filed under: SEO,Small Business Growth,Web Site Development — smallbizexperts @ 4:25 pm

changeDo you want to show up higher in Google and Yahoo? To do so there’s a myriad of things you need to do, none of which is as important as maintaining fresh content on your Web site. Search engines reward those who provide fresh content on their sites. Going with the theme of writing first for the customer, then for search engines, you should be changing the content on your Web site at least once a month.

But it’s not just change to change. Make sure your change contains the keywords you’re hoping to show up for in Google. For example, I have a chiroprator client in Overland Park, Kansas, named Jason Huffman. We change his health tip of the month so it includes his key words. Here’s last months health tip. “Are the recent layoffs from major companies in Overland Park Kansas stressing you out? As a Chiropractor in your neighborhood I can provide the relief you need.”

Next month we’ll talk about lower back pain, and how by using all the walking trails in Overland Park Kansas at least three times a week, etc…

Change often and change in relation to your sites key words. When was the last time you changed the content on your Web site? If you are changing your site, is it helping your rankings? Please provide in comment form your success stories.

Chris Nastav, KC Web Specialists, LLC. www.kcwebspecialists.com
Experts in how business gets done on the Internet (913) 908.5642

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