Health - Ch. 3 - Section 3

Consist of funds set aside by employers to reimburse employees for qualified medical expenses. employers qualify for preferential tax treatment of funds placed in an _______ in the same way that they qualify for tax advantages by funding an insurance plan. employers can deduct the cost as a business expense.

- defined as contribution healthcare plans, not defined benefit plans;
- not a taxable employee benefit;
- employers' contributions are tax deductible;
- allow employees to rollover unused balances at the end of the year;
- do not require that employers advance claim payments to employees or healthcare providers during the early months of the plan

- provided with employer dollars, not employee salary reductions;
- permit the employer to reduce health plan costs by coupling the hra with a high deductible (an usually lower-cost) health plans
- even the playing field between the group purchasing power of larger employers and smaller employers

Open to employees of companies of all sizes; however, the employer determines eligibility and contribution limits. has no statuatory limit. limits may be set by employer and rollover at the end of the year based on empoyer discretion. former employees, including retirees, can have continued access to usused ________, but this is done at the employer's discretion. remina with the originating employer and do not follow an employee to new employement.

Often used in coordinatino with msa's, hsa's or hra's. features higher annual deductibles and out of pocket limits than traditional health plans, which means lower premiums. except for preventive care, the annual deductible must be met before the plan will pay benefits. preventive care services are usually first dollar coverage or paid after copayment. credits a protion of the health plan premium into the coordinating msa, hsa, or hra on a monthly basis. the deductible may be paid with funds from the coordinating account plan.

Designed to help individuals save for qualified healthe expenses that they, their spouse or their dependents incur. they are tax-free. an individual who is covered by a high deducitble health plan can make a tax-deductible contribution to this and use it to pay for out of pocket medical expenses. contributions by individuals are deductible, even if the taxpayer does not itemize. contributions by an employer are not included in the individual's taxable income.

To be eligible, an individual must be covered by a high deductible health plan, must not be covered by other health insurance (does not apply to specific injury insurance and accident, disability, dental care, vision care, long-term care), must not be eligible for medicare (reached age 65), and can't be claimed as a dependent on someone else's tax return.

Linked to high deductible insurance. a person may obtain coverage under a qualified health insurance plan with a minimum deductible of $1100 for singles and $2200 for families. each year eligible individuals (or their employers) are allowed to save 100% of the health plan's annual deductible, up to $2850 for singles and $5650 for families in 2007. when opening an account, an individual must be under 65 (the age of meadicare eligibility). for taxpayers aged 55 and older, an aditional contribution amount is allowed ($800 in 2007, up to $1000 in 2009).

An _________ holder who uses the money for a non-health expenditure pays tax on it, plus a 10% penalty. after age 65, a withdrawal used for a non-health purpose will be taxed, but not penalized.

Health care plans that are controlled by the employer. basically the employee member receives first-dollar coverage from a designated health account (can be HRA or HSA) until funds are depleted, then a deductible gap must be met before an insurance plan is available to cover additional cost.

While other types of plans restrict certain types of coverage, members of ___________ may use funds from the plan to pay for costs associated with genetic testing or a special nursery school for a child, for instance, without being denied coverage. the employer determines eligibility of the employees - not national qualifying requirements. the employer determines the contribution, the growth percent and the exit rules. funds are allowed to rollover from year to year at the discretion of the employer.

For most people who are unable to go to work, employement income would terminate after a brief period of time and consequently most people would be forced to turn to personal saving to pay normal living expenses such as food, rent and utilities. one should ask how long he or she could survive without any income.

A vital component of a comprehensive insurance program that is designed to prelace lost income in the event of this contingency.

Disability income insurance is designed to provide a reasonable and predetermined income to a disabled party for a set period of time subject to a "time deductible" termed an ________________.

Provides after a specified waiting period, a monthly benefit for a stated amount and period of time for total and parital disability due to injury (accidents) or illness (sickness). can be purchased individually or on a group basis through an employer