The Health Savings Account (HSA) by richman6


									NIA/Combined presents:
The Health Savings Account
About Assurant Health

• U.S. individual medical market leader
• In business over 110 years
• More than 1,000,000 customers1
   1Assurant Health is the brand name for products underwritten and issued
   by Time Insurance Company.
Assurant Health—an HSA leader

• At the forefront of HSA legislation
• Sold the first HSA
• Expert in account administration
• Offers one of the only custodial accounts in the country
  providing seamless administration option with no fees
What is an HSA?
• Tax-sheltered savings account
• Allows for the accumulation of funds to pay for qualified
  current and future health care expenses
• Paired with a qualified high deductible health insurance plan
• Together, the high deductible plan and HSA provide:
    — Premium savings
    — Tax advantages
    — Investment opportunities
Huge new opportunity
HSAs are:
       •    Tax free
       •    Flexible
       •    Permanent
       •    Portable

Assurant Health makes HSAs simple and easy
How big is the HSA market?

• Congressional analysts estimate up to 40 million accounts will
  be created over the next 10 years
• Everyone2 with a qualified high deductible plan is eligible
• HSAs make high deductible medical plans more attractive
  and easier to sell than ever before
   2To be eligible, the qualified high deductible health plan must be the
   client’s only major medical coverage.
Federal guidelines
• Annual contribution limits for 2006 are the lesser of:
   1) The deductible or
   2) $2,700 (individual) / $5,450 (family)
• Individuals 55 and over are allowed to contribute an
  additional $700 for 2006
• Unused MSA plan funds may be rolled over into an HSA
  without penalty
• No first-dollar benefits except for wellness
HSA deductibles
                        Single   Family

Maximum Out-of-Pocket   $5,250   $10,500

Assurant Health         $1,100   $2,200
                        $1,600   $3,200
                        $2,100   $4,200
                        $2,700   $5,400
                        $5,000   $10,000
Family deductibles
What is a common family deductible?

  A common family deductible refers to the accumulation of
  all medical expenses for all covered persons to meet a
  single deductible
HSA advantages

• Funds are contributed tax free
• Funds gain interest tax free
• Withdrawals for qualified medical expenses are tax free
• Funds can be withdrawn at age 65 for other purposes without
  penalty—only ordinary income tax applies
   (A 10% penalty plus ordinary income tax applies if funds are withdrawn
   before age 65 for non-medical expenses)
Eligible expenses
Qualified withdrawals:
• Eligible medical expenses as defined under Section 213 (d)
  of the IRS code
    — Medically necessary services
    — Deductibles and coinsurance
    — Vision correction
    — Dental expenses
    — Non-prescription drugs
• Qualified long-term care premiums
• COBRA continuation premiums
• Premiums while unemployed
• Medicare Part A, B and D premiums (not Medicare supplemental
Cost comparison scenario

• Family coverage (husband and wife are 37 years old,
  have two children)
• 28% federal tax bracket
• Living in metropolitan area
• $1,500 in claims
          Cost comparison
                                     Typical Family Plan       Assurant Health HSA Plan
                                     Three times single        Common family deductible =
                                     deductible = $1,000       $5,400
Coinsurance:                         80%/20%                   100%
Premium paid:                        $8225                     $4,506
Insured’s share of health care       $1,000 for deductibles,   $1,500 for deductible and $550 for
                                     $100 for coinsurance,     dental/eyewear expenses
expenses: ($1,500 claim)
                                     $550 for dental/eyewear
                                     +$1,650                   +$2,050
Expenses subtotal:                   $9,875                    $6,556
Tax savings on HSA deposits:         $0                        $1,512
Net expenses:                        $9,875                    $5,044
 (out-of-pocket minus tax savings)
Total net savings with HSA Plan:                               $4,831

                                                               HSA Balance $3,350
HSA administration options

• HSA Fundamentals
   — feeless, seamless administration

• HSA Tools
   — enhanced administration
HSA Fundamentals—
feeless, seamless administration
• No administrative, setup or user fees
• Competitive interest rates
• Optional automatic claims payment
• Several contribution options
    — Monthly, quarterly, semi-annual, annual
HSA Tools—
enhanced administration option
• VISA debit card
• Simple, comprehensive online features
• Competitive interest rates
• All for only $3.95 per month
    — Fee not applicable in AZ, GA and NC
Money withdrawal methods

HSA Fundamentals
• Automatic disbursement method
• Manual disbursement method

Assurant Health HSA Tools
• VISA debit card
Clients save premium, reduce taxes
and build savings
• Unused funds accumulate from year to year
• Use the money to pay for qualified medical expenses
  tax free as they occur
• Save money tax free for future medical expenses
• Accrue savings and build a tax-sheltered fund for other
  expenses in retirement
Get a jump on the competition

• Since everyone with a qualified high deductible medical plan is
  eligible, these accounts will be in big demand
• Don’t lose a sale to a competitor because you don’t offer them
• Assurant Health has a market leadership position
• Your HSA experts at Assurant Health are ready to assist you
      Want more information?

For more information or to obtain additional
        HSA sales materials, see

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