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Qualified High Deductible Health Plan

**NEW AS Of 2023 – Qualified High Deductible Health Plan Available**

We are excited to present a new medical benefit option for our workforce. This additional plan option will provide a consumer driven, triple tax advantaged option for our employees. Effective January 1, 2023, we will be offering a Qualified High Deductible Health Plan (QHD) though Kaiser Permanente and an accompanying Health Savings Account (HSA). The current medical plans will remain in place, allowing you to select the plan that best fits the needs of you and/or your family.

A QHD is a consumer driven plan and provides you with more control over your health care costs. It will be important to review all of the communication materials carefully so you can decide if this will be the best option for your healthcare needs. Many of the plan design components are very different from our current plan offerings. For example, under the QHD, you must satisfy a higher annual deductible before the plan will begin paying benefits. However, the QHD also provides some incentives for taking on that responsibility:

  • Lower Payroll Premium Contributions: Because you are assuming a larger part of your health care cost risk, the premiums for the QHD are lower.
  • Tax Advantages: Employees enrolled in the QHD may also enroll* in an HSA, which allows you to set aside pre-tax money to use for eligible health care expenses, including your deductible and coinsurance.
  • Preventive Care Fully Covered: Preventive services (routine physicals, immunizations, gynecological exams, mammograms, etc.) are 100% covered, and not subject to the deductible.
  • Catastrophic Expense Protection: If you reach the out-of-pocket maximum, the plan will cover all further eligible expenses at 100% for the remainder of the calendar year.

 

Whether or not the QHD/HSA plan is right for you depends on two important questions you
need to ask yourself:

  • How Often Do I Use My Health Care Benefits? If you are someone who sees a doctor once or twice a year for routine preventive care or the occasional treatment, selecting an QHD could save you money simply because your payroll contributions for the QHD are less than your contributions for other available plan options.
  • Am I Comfortable Assuming the Risk of a Higher Deductible? If you or a family member require medical care, you could be faced with substantial out-of-pocket costs. However, as you build savings in your HSA, that risk may diminish as you use your HSA to pay for your deductible and other eligible costs. Your HSA also gives you greater purchasing power, as the money you deposit is not subject to federal income taxes.

 

HEALTH CARE COSTS CONTINUE TO RISE, SO WHY NOT MAKE THE MOST OF
EVERY DOLLAR YOU SPEND?

Employees who participate in the Qualified High Deductible Health Plan (QHD) are eligible* to enroll in a Health Savings Account (HSA).

An HSA is just what it sounds like - it’s a personal, individual account that you can use to set aside money on a tax-advantaged basis, to use for health care expenses for you and your qualified dependents. Making contributions to your HSA on a pre-tax basis reduces your taxable income in the same way that 401(k) contributions would, meaning that you can save on taxes. Unlike a 401(k) plan, however, your HSA money - including any interest it has earned - remains tax-free even when you withdraw it, provided it is used for an eligible health care expense that is not paid for by any insurance plan. TRIPLE TAX ADVANTAGE!

 

ELIGIBLE HEALTH CARE EXPENSES INCLUDE:

  • Medical bills
  • Doctor visits
  • Prescriptions
  • Laboratory fees
  • Over the counter medications
  • Other qualified expenses, such as vision, dental, chiropractic and more!
  • Copays, coinsurance, and out-of-network charges

You can contribute to your HSA through easy payroll deductions; simply determine how much you would like to contribute. With an HSA, there is no “use it or lose it” rule like you see in flexible spending accounts. Money left unused at the end of the year remains in your account. Please note, the Internal Revenue Service does limit the amount that can be deposited into an HSA each year. For 2023, single subscribers can deposit up to $3,850, while employees in the ‘Employee + Spouse,’ ‘Employee + Child(ren)’ or ‘Family’ coverage tiers may deposit up to $7,750. These limits are a total of all contributions, including those made by your employer.

 

FLEXIBLE SPENDING AND HEALTH SAVINGS ACCOUNT PLANS

A Limited Purpose Flexible Spending Account (FSA), is one of several pre-tax accounts you may be able to sign up for through your benefits program. It is used to pay for vision and dental expenses that are not covered by insurance.

A Limited Purpose FSA can sometimes be confused with a Health Care Flexible Spending Account (FSA), also known as a General Purpose FSA. While they have similar names and can cover similar expenses, there are some key differences:

  • A General Purpose FSA can be used to pay for your out-of-pocket expenses related to medical care, dental care and vision.
  •  A Limited Purpose FSA can only be used to pay for your out-of-pocket expenses related to dental and vision.  In other words, the Limited Purpose FSA is limited to paying for those two types of expenses.

Compatibility with other plans

  • A General Purpose FSA is not compatible with a Health Savings Account (HSA). You can either have a General Purpose FSA or have an HSA. You cannot have both accounts at the same time.
  • A Limited Purpose FSA is compatible with a Health Savings Account. You can have both a Limited Purpose FSA and an HSA account.
  • You cannot have a Limited FSA and a General FSA at the same time. They are mutually exclusive

Find out if you are eligible HERE.

 

*Employees enrolled in the QHD are eligible to enroll in an HSA provided they are not covered by any non-high deductible health plan. This includes Medicare and/or a Health Care Flexible Spending Account (FSA), including a spousal FSA.

 

Hanford Employee
Welfare Trust (HEWT)
QHD Information


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FREQUENTLY ASKED QUESTIONS (FAQs)

QHD FAQs
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THINGS YOU
SHOULD KNOW

Make sure that you know these important insurance terms:

Individual Deductible: The amount you pay each year before the plan starts to pay a benefit (for employee-only enrollment).

Family Deductible: The amount you pay for your family before the plan starts to pay a benefit for any member of your family.

Preventive Care: Covered in full and not subject to the deductible.

Coinsurance: The portion of your medical charges paid by the insurance company after your deductible is satisfied.

Out-of-Pocket Maximum: The amount of money you can spend for the deductible and coinsurance before the plan will pay 100% of any remaining eligible expenses for the rest of the plan year.

Prescription Drugs: Subject to the deductible and coinsurance.

In-Network: Providers have an agreement with the insurance carrier to charge a discounted fee. You pay the in-network percentage of that fee, after deductible.

Out-of-Network: Providers can charge whatever they want. You pay the out-of-network percentage of the insurance company’s ‘reasonable and customary’ (R&C) fee, plus any amount the provider charges in excess of the R&C fee, after deductible.
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QHD THINGS TO
KEEP IN MIND

You must satisfy your deductible before the plan pays for services - including prescription drugs.

Make sure all claims are submitted to the carrier, even if you know you have to pay for the service because you have not met your deductible. This way you can be sure that all expenses are applied to your deductible.

Tell the provider you are in a High Deductible Health Plan and that they should bill you after they receive the insurance company Explanation of Benefits (EOB). Note, you will need to meet the deductible before the plan will begin paying benefits, including the cost of covered prescriptions. HSA funds can be used to pay for your prescription drugs.

You will receive an EOB that tells you the amount billed, the approved and discounted amount, and what portion of the expense is your responsibility.
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BENEFITS OF AN HSA
Contributions to an HSA are tax-free (federal tax and FICA).

Interest earnings are tax-free.

Unused funds roll over year after year.

Your HSA account is fully portable - you keep it even if you discontinue your employment or disenroll from the QHD.

Money you save is available for health care purchases now, or at any time in the future, even if you no longer participate in a high deductible health plan (though you may only contribute to an HSA while you are enrolled in a high deductible plan).

If you are 55 or older, you can make a “catch up” contribution to your HSA of up to $1,000 each year.

Last Updated 05/22/2024 8:59 AM