There are many Tax-Benefit
health plans available for you and your employees. How
do you know which one is best for you? Would a combination
of plans work best? How do they fit in with your company's
tax strategy? Will your employees understand and be happy
with your plans?
These are just a few of the questions that employers NEED
to have answered. Is your benefits consultant giving you
these answers?
Health Savings Accounts
A Health Savings account is a like a checking account
combined with a High Deductible Health Plan to pay for
qualified medical expenses tax free. Employees and employers
can contribute to the account and get a deduction for
those contributions. Money that goes into the account
is tax-free and can build up year to year. When medical
expenses occur (big or small), money used from the account
can meet those costs, and it will count toward the annual
deductible for the Health Plan. If the deductible is
met during the year, the health plan then takes over
for its required portion of expenses. This has the effect
of a person being able to pay for medical services with
TAX FREE money!
Also, these plans can be set up with some flexibility,
which could benefit your employees at no extra cost
to you. For example, if you have a Health Savings Account
system set up for your employees, can that employee
contribute the maximum amount allowed even if their
spouse is covered elsewhere under a traditional plan?
Subtle benefits like that can make go a long way toward
making a model employee.
Health Reimbursement
Accounts
An HRA is an account that is funded by the employer
to help employees meet their deductible, or other qualified
medical services. This allows the employer to deduct
those contributions and save costs by utilizing a higher
deductible insurance plan. These accounts can be limited/capped
per your requirements and any remaining funds can rollover
year to year. If the employee terminates, any unused
funds stay with the employer.
These plans offer a great amount of tax-planning and
cost-saving benefits to the employer, while allowing
employees to maintain adequate coverage with access
to money for deductible coverage.
Flexible Spending Accounts
An FSA is an account to which both employer AND employee
can contribute to help cover qualified medical expenses
such as co-pays, deductibles, over the counter meds,
etc. Money contributed by the employees is done on a
pre-tax basis for them, AND a NON-TAX basis for the
employer. Employer contribution is optional.
FSAs do have a "use it or lose it" clause.
Any unused money is kept by the employer at the end
of each year to help offset administrative or premium
costs.
So which is right for you?
This is where expert advice is necessary. Granite Benefits
can analyze your needs and develop a plan that can put
you in the most tax-favored position. Give us a call
- you'll love our answer!
|
