Isnt It Time for a Health Savings Account by fionan


									Isn’t It Time for a
Health Savings Account?
Savings solutions. Comprehensive Coverage. Empowered Employees.
Introducing Health Savings Accounts
             HSAs are complex arrangements
             subject to various IRS rules
                                                   What is an HSA                     • Employees who withdraw
                                                                                        money for purposes other
             and regulations, which are not
             all explained in this brochure.
                                                   and how does                         than qualified medical
                                                                                        expenses must pay taxes on
             Please read the “Important            it work?                             the withdrawal, and a 10%
             Notice” at the end of this                                                 IRS penalty.
             brochure for important                Health Savings Accounts (HSAs)
                                                                                      • Contributions to the fund may
             information.                          are tax-advantaged savings
                                                                                        now exceed the plan deductible.
                                                   accounts that are combined with
                                                                                        The maximum contribution
                                                   a qualifying High-Deductible
                                                                                        amount in 2007 is $2,850 for
                                                   Health Plan (HDHP) to
                                                                                        self-only coverage and $5,650
                                                   maximize choice while helping
                                                                                        for family coverage (subject to
                                                   to reduce health plan premium
                                                                                        certain maximum amounts set
                                                                                        by the IRS.) The maximum
                                                   • An HSA is a personal, interest     contribution amounts for
                                                     bearing account that may be        2008 are $2,900 for self-only
                                                     funded by the employer             coverage and $5,800 for family
                                                     and/or the employee.               coverage.
                                                   • The HSA is to be used with a     As you can see, HSAs operate
                                                     qualified high-deductible        differently than other health care
                                                     health plan and may be used      funding arrangements you are
                                                     to pay for qualified medical     used to choosing for your
                                                     expenses.                        employees. They allow employees
                                                   • Employees can make pre-tax       to be more involved in deciding
                                                     contributions through payroll    how and where their health care
                                                     deduction to the HSA             dollars are spent while providing
                                                     account and withdrawals for      the security of a high quality,
                                                     qualified medical expenses are   High-Deductible Health Plan to
                                                     tax-free.                        cover medical expenses over and
                                                   • Unused HSA funds may be          above the deductible amount
                                                     rolled over indefinitely and     when they occur.
                                                     because the account is owned
                                                     by the employee, he/she can
                                                     take it when leaving or
                                                     changing employers.

                                                   These accounts provide savings
                                                   solutions while maintaining
                                                   high quality health care coverage
                                                   and empowering employees to
                                                   become better health care

How ConnectiCare’s High-                                                          Why Choose
Deductible Health Plans work                                                      an HSA?
High-Deductible Health Plans                  Hampshire counties in               Multi-year benefits
combine member responsibility                 Massachusetts, and Orange,          strategy:
for health care decisions with                Putnam, Rockland and                We’d be happy to consult with
quality benefits coverage. When               Westchester counties in             you in developing a custom
you combine the savings account               New York.                           multi-year strategy to introduce
aspects of HSAs with the proven             • More than 85 hospitals and          HSAs to your employees, and
quality of ConnectiCare’s benefit             22,500 health care providers to     help you increase their migration
plans you have a powerful                     choose from                         into your HSA plan in future
combination of tools to help                                                      years.
                                            • Access to nationally-recognized,
employees understand the value
                                              award-winning Health
of their health care coverage.
                                              Management programs including
                                                                                  Premium savings and
High-Deductible Health Plans
                                              Birth Expectations, Breathe,        stability:
provide members with access to                                                    With health care costs continuing
                                              DiabetiCare and HeartCare
a range of benefits including:                                                    to increase, many employers are
                                            • Healthy Alternatives — a series
                                                                                  unable to stretch their budget
• Coverage for medical services               of available discount programs
                                                                                  any further — and some are
  including prescription drugs.               designed to improve members’
                                                                                  forced to stop offering health
  Please review your benefits                 health through a variety of
                                                                                  benefits altogether. When
  summary for more information.               resources including health club
                                                                                  compared to traditional forms of
• Medical and prescription drug               membership, weight manage-
                                                                                  coverage, HSAs can help to bring
  expenses that are subject to the            ment programs, nutritional
                                                                                  annual premium increases under
  deductible, copay or coinsurance            counseling, acupuncture,
                                                                                  control. You can even use part of
  (if applicable).                            massage therapy and more.
                                                                                  your premium savings to fund
• First dollar coverage for a broad         Another advantage that                your employees’ HSA account if
  list of preventive services. Please       ConnectiCare plan designs offer       you decide to do so.
  review your benefits summary              is that these plans support certain
  for more information.                     preventive care services at 100%
                                                                                  Maintain quality
• In-network services from                  coverage, or at a small copayment     coverage:
  ConnectiCare’s participating              based on the plan design you          By making the most out of
  providers located throughout              select. These services are not        health care dollars, HSAs allow
  all of Connecticut, Berkshire,            subject to the deductible, (such      you to continue providing the
  Franklin, Hampden and                     as well visits to a Primary Care      high-quality health benefits your
                                            Physician.)                           employees have come to rely on.

                                                                                  Lower premium
                                                                                  Because annual premium increases
                                                                                  are mitigated for the employer,
                                                                                  the employee, in turn, might pay
                                                                                  lower premium contributions.

Value-conscious employees:
The design of HSAs seeks to
make employees active and
involved participants in their
health care. There are financial
incentives for employees to make
informed and prudent health
care decisions. Employees view
the HSA as spending “their”
money, and begin seeking the
most value for their dollars.
Individuals with chronic health
conditions, for example, can help
reduce treatment costs by
enrolling in one of our nationally
recognized Health Management
Programs. These programs offer
                                     See how an HSA can lower employer
one-on-one assistance from a         health care costs
specially trained nurse case
manager, who provides informa-       The illustration below shows how an employer may achieve greater premium savings by switching
tion about self-care, lifestyle      coverage to a ConnectiCare HSA-compatible High-Deductible Health Plan. All cost information
changes, evidence-based health       is for example purposes only and may not reflect actual premium savings.
care practices, and treatment
                                       Current coverage
Choice and flexibility:              Employee: Male
• You choose which qualified         Coverage Type: Family
  high-deductible health plan(s)     Plan Type: HMO OA 20-30 copay
  best meet your company’s           Rx coverage: $10/$20/$35
                                     Employer monthly cost:                                                              $1,400
• You can choose the employer
  contribution level for the HSA.
• You decide whether to have           HSA plan savings
  HSA contributions deposited
                                     HSA Plan Type: HMO-OA HDHP $3,000 Family Deductible
  annually in one lump sum,
                                     Rx coverage: $15/$25/$40 copay after deductible is met; up to $1,500
  semi-annually, quarterly,
                                     Rx family copay maximum.
  monthly or weekly.
                                     Employer cost per month:                                         $1,000
Tax-free benefit:                    Monthly employer premium savings when enrolled in a
Any contribution you make to         ConnectiCare HSA-compatible HDHP plan:                            $400
the HSA is a tax-free benefit for    Annual employer premium savings:                                 $4,800
your employees.                      100% employer contribution to HSA account*:                      $3,000
                                     Annual employer net savings:                                                        $1,800
No “use it or lose it”
The employees’ unused HSA            * Employers can choose to contribute any portion of the maximum contribution amount to employees’ HSA accounts, or nothing at
funds roll over year after year.       all, as long as they meet comparability rules. Savings may vary by employee based on percentage of contribution, HSA plan type
                                       selected, coverage type and Rx coverage selected. Studies have shown that employers who fund a portion of the plan deductible for
                                       their employees’ HSA accounts enjoy greater employee enrollment in these types of plans. We’d be happy to assist you and your broker
                                       in establishing a multi-year contribution strategy.

                                      There are IRS rules governing employer contributions to employees’ HSA accounts, and employers are advised to consult qualified tax
                                      or legal professionals to assure compliance with these rules. Also, there are instances where total health plan costs for members may be
                                      higher with an HSA than with a traditional HMO plan.

Why ConnectiCare?
Because your employees’ HSA           Having a ConnectiCare HDHP           ConnectiCare also offers a
accounts can be used with             also means you get the outstanding   number of value-added programs
ConnectiCare HSA-compatible           health plan service and quality      to support and promote your
 High-Deductible Health Plans,        that ConnectiCare is known for.      employees’ health and wellness.
    employees can benefit from        ConnectiCare earned the highest
     significant savings on most                                           Please see “Important Notice”,
                                      member satisfaction score for
      covered services due to                                              on inside back cover, for further
                                      customer service and claims
      ConnectiCare’s negotiated                                            information.
                                      processing of any health plan in
      participating provider and      Connecticut — and well above
     prescription drug rates. This    the national average, according to
   means that their HSA funds can     the 2006 Consumer Assessment
go further with ConnectiCare.         of Healthcare Providers and
ConnectiCare’s negotiated rates       Systems Survey (CAHPS).
are generally better than those for   ConnectiCare has also maintained
PPO and fee-for-service plans.        four-star excellent accreditation
Participating providers must accept   status from the National
the negotiated ConnectiCare rate      Committee for Quality Assurance
as payment in full and employees      (NCQA) since the category was
cannot be billed for any balance.     established in 1999.

You and your employees can rely on the
outstanding health plan service and quality
that ConnectiCare is known for.

                                        feature, and more information
Information                             about a member’s doctor.
is power                                We have also incorporated the
                                        ability to search for doctors
Because an HSA gives members            by county, city, ZIP code,
more control over how their             name, network affiliation and
health care dollars are spent, it’s     distance. Members can also
important for your employees to         create a customized, printable
be as informed as possible about        directory.
their health care decisions. To       • The ability to obtain physician
help your employees make these          profiles.
decisions we offer a variety of
powerful, useful tools on our
Web site. With these tools they’ll    PlanCompare
be able to navigate through and
more clearly manage the many          & CostCompare
choices they have when consid-
ering their personal health care
                                      upgrades now
needs.                                allow your    Personal                                                        Subimo
                                      employees to  Health                                                          Healthcare
Member self-                                                                                                        Advisor™ and
                                      do more       Manager
service tools                                                                   The Personal Health Manager         PharmaAdvisor™
                                      Choosing the right health benefit
In the Managing Your Accounts         plan is important but it can              provides members with online
and the Cost of Care sections of                                                information, resources and tools    These tools are for anyone facing
                                      sometimes be a daunting task.
our Web site we provide a variety                                               to help maintain their health.      an important health care decision
of tools that outline each member’s   That’s why ConnectiCare has
                                                                                Members can use it to:              or for those needing to learn
personal health plan basics.          contracted with WebMD®, to
                                                                                                                    how to manage a particular
These include:                        provide a decision support tool
                                                                                • Complete a Health Risk            condition. This combined
• Medical and pharmacy claim          that can help sort through an
                                                                                  Assessment;                       suite of tools is available to
   history. Members can view          array of benefit plans and price
                                                                                • Create an electronic Personal     ConnectiCare members at no
   up to 18 months of claims          comparisons.
                                                                                  Health Record;                    charge and offers a number of
   history including claim totals,
                                      Features allow for personalized                                               references including a Decision
   deductibles, coinsurance                                                     • View WebMD’s Treatment
                                      input providing a more accurate                                               Guide to help your employees
   where applicable and other                                                     Cost Estimator to determine
                                      analysis of the total costs includ-                                           and their families address and
   relevant information.                                                          estimated costs for hundreds of
                                      ing the ability to:                                                           act on key health-related
                                                                                  common procedures and tests;
• Health Care Financial                                                                                             decisions.
  Summary. This is a summary          • compare the benefits and costs          • Receive targeted wellness
  for subscribers of our                of the various plan options               information;                      Viewing benefit summaries
  High-Deductible Health Plans          offered;                                • Set up reminders about            online. Members can check
  (HDHPs) which are                                                               appointments and screenings;      their benefit summaries for
                                      • provide employee paycheck
  compatible with Health                                                          and more.                         copayment information,
                                        frequency to help calculate
  Savings Accounts (HSAs).                                                                                          deductible, coinsurance and
                                        their annual premium
  It’s especially important for                                                                                     related information whenever
  HSA account holders to keep                                                                                       they need it.
                                      • enter the employee-contribution
  track of their health care                                                                                        Staying Healthy. With this tool
                                        amount to gain a more
  spending because they can use                                                                                     members can stay in control of
                                        accurate assessment of the
  these tax-exempt accounts for                                                                                     their health with a variety of
                                        total cost-share; and
  qualified medical expenses.                                                                                       features including: Managing
                                      • enter the employee’s and/or                                                 Your Health, My Health Resources,
• Find a Doctor, our online
                                        the employer’s annual HSA                                                   and Health Trackers.
  provider directory provides
                                        contribution, if applicable.
  frequent updates of our
  provider data, a Quick Search

Health                                     Worksite                             Healthy
Management                                 Wellness                             Alternatives
Programs                                   ConnectiCare has developed a         ConnectiCare’s Healthy
                                           full range of wellness programs      Alternatives offers a number of
ConnectiCare is one of only a              for you and your employees.          discounts on health-related items
handful of health plans in the             ConnectiCare can customize           and services such as weight
nation to receive a full, three-year       programs to fit specific worksite    reduction programs, acupuncture,
accreditation from the NCQA                needs. Programs include:             massage therapy, and nutritional
for all of our health management                                                supplements. The program is
programs. These programs provide           • Stress management                  designed to assist members in
education and support to                   • Medical self care                  improving and maintaining their
members to help them control               • Nutrition and weight               health. ConnectiCare members
their conditions, improve their              management                         enjoy discounts just by showing
quality of life, and maintain their        • Smoking cessation                  their ID cards.
best health status.                        • Healthy fitness
• Birth Expectations — for                 • Health risk profiling
  high-risk pregnancies                    • Prenatal education
• BREATHE — for asthma and
                                           Worksite Wellness programs
                                           can help to reduce absenteeism,
• DiabetiCare — for diabetes               increase productivity and increase
• HeartCare — for coronary                 employee satisfaction and
  artery disease and congestive            goodwill. Note: There is a fee
  heart failure                            for these programs.
In addition, ConnectiCare covers
immunizations and screenings
designed to encourage preventive
measures that help protect
against and detect serious illness.
And, ConnectiCare’s Pharmacy
Quality Initiatives have shown
significant impact in addressing
cholesterol, diabetes, heart
disease, asthma, and drug safety
in the elderly.

First HSA — nationally
recognized leader in
HSA administration
ConnectiCare has selected one of the nation’s leading authorities on
Health Savings Account administration as a preferred administrator
that can manage, administer and service your employees’ HSA
accounts. First HSA is a nationally recognized leader in HSA account
administration and has worked with members of Congress in the
development of today’s HSA account rules. For more information on
First HSA call (610) 678-6000 or toll-free at 1-888-769-8696.

First HSA provides a full range of administrative and technical services:
• Account set-up and administration
• Flexible and convenient contribution options
• A checkbook for convenient payment of covered medical services
• A VISA® debit card
• Automated telephone banking 24-hours-day, 7-days-a-week
• Monthly account statements detailing contributions, withdrawals,
  interest earned and ending balance
• Year-end tax statements
• Internet access to account information via the First HSA Web site,
• Integrated investment options
• Competitive interest rates
• Free monthly administrative fees as long as your employees are
  enrolled in a ConnectiCare High-Deductible Health Plan

               First HSA is a nationally
               recognized leader in HSA
                 account administration.

Getting started and setting up HSA accounts
Here are some simple steps to follow to start your HSA enrollment process:

STEP 1: Enroll in one of ConnectiCare’s High-Deductible Health Plans.
STEP 2: Distribute First HSA information to your employees.
STEP 3: Determine your method of contribution. Contact First HSA for
        detailed instructions.
STEP 4: Collect First HSA applications.
STEP 5: Submit First HSA applications to First HSA.
STEP 6: The applications will be processed and a “Welcome Packet” will
        be mailed to your employees.

For more information on consumer-driven health plan options, please
contact your agent or broker, or call your ConnectiCare Sales Executive
or Account Manager.

                    Important Notice:
There are instances where total health plan costs for members may be
higher with an HSA than with a traditional HMO plan.

There may be some rare circumstances in which the fee that is contracted
between ConnectiCare and its providers can be higher than the billed
rate. In these instances (less than 1% of all cases) a member will be
required to pay the higher amount for these covered services even
though the billed rate may be lower. This payment arrangement must
be met to allow for the tax-qualified status of his or her high-
deductible plan.

ConnectiCare’s HSA-compatible high deductible health plans (Plans)
are intended to be appropriate for use with HSA accounts. The Plans
have been designed to conform with Federal Internal Revenue Service
(IRS) guidelines on such plans. However, the IRS has made no determi-
nation that the Plans are qualified. Whether or not an HSA used with
these Plans will provide a ConnectiCare member with a tax advantage
depends on a number of circumstances, including the member’s personal
coverage situation, contributions to and withdrawals from the HSA
account, other coverage a member or spouse may have, and changes to
or interpretations of IRS rules. Members should consult with a qualified
tax advisor in determining whether and how this option may provide
them with a tax benefit. ConnectiCare cannot guarantee that tax benefits
will accrue to anyone covered under the Plan.

ConnectiCare provides only health plan coverage and administration.
First HSA provides HSA accounts and administration. The accounts are
separate from ConnectiCare health plans. ConnectiCare is not responsible
for the administration of any HSA accounts or other financial accounts
used in connection with its health coverage products. First HSA may
charge you a fee for the set-up or administration of your HSA account.

This brochure is only a general overview of some HSA and consumer
driven health plan information. It is not intended to provide tax or
legal advice of any kind, and neither the accuracy nor completeness of
any information is guaranteed. Consult a qualified tax or legal profes-
sional with any tax or legal questions you may have.
                                         175 Scott Swamp Road, Farmington, CT 06032

Coverage is provided by and services are administered as follows: In Connecticut: Group HMO and POS coverage, and Individual HMO is underwritten by
ConnectiCare, Inc.; Individual POS is underwritten by ConnectiCare Insurance Company, Inc. In Massachusetts: Group HMO and POS coverage is underwritten
by ConnectiCare of Massachusetts, Inc. In New York: HMO and POS is underwritten by ConnectiCare of New York, Inc. FlexPOS, PPO coverage, ASO/Self-funded
services, and Dental products are administered or underwritten by ConnectiCare Insurance Company, Inc.

                                                                                                                                            HSAER 0907

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