With the election behind us, there’s more certainty about the direction of health care reform, but it’s not over yet. State officials got an extension. They have until December 14 to decide whether to run their state health insurance exchange or let the federal government run it. And, all the work to open the exchanges has to be completed by October 2013. That’s when the exchanges are to be open for business with coverage going into effect January 1, 2014.
More than 30 million people who need health insurance are projected to be able to get coverage then, but more of us are underinsured than uninsured. So, what’s happening to help us?
Policies no longer limit the amount of coverage available per lifetime. By 2014, they won’t limit the amount of coverage available per year, either. There’s still the issue of out-of-pocket costs for most of us, though.
You’ve probably noticed that policies requiring you to pay for health care until it adds up to a certain amount, or a deductible, tend to charge some of the lowest premiums. These plans pay for recommended preventive care before you’ve met the plan’s deductible now, so opting for one of the low-premium policies may work for you. In that case, you need to know two other things.
If you had a plan with a deductible prior to health care reform, you may not have this expanded coverage. Find out before you end up paying for something you thought was covered. If your old policy doesn’t have to provide the new coverage, you have the option of upgrading to a new plan that will, as long as your health is good. And, if you have health problems, companies will have to accept your application in 2014.
The other thing you need to know is that only one type of health insurance helps you reduce the taxes you owe. Certain of the high-deductible health plans let you open a Health Savings Account or an HSA. I know, who has much to save now days, but this is not your average savings account. If you aren’t saving and you are paying for dental or health-related care, you can run those payments through your HSA to claim a tax deduction for just about all these bills.
These expenses don’t have to be any percentage of your income to qualify. And, it doesn’t matter what your annual income is, either. Of course, if you can save, the IRS lets you claim a deduction for that, too, as long as you save in an HSA. The net effect is that most people will owe less in federal and state taxes thanks to this type of coverage. Then they can use the money they save on taxes to pay for health care or get tax-free earnings by keeping that money in their HSA.
You can claim these tax deductions for 2012 even though the year is just about gone. You need an HSA-qualified health insurance plan by Dec. 1, and then you have until April 15, 2013 to open a Health Savings Account. We’re here to help you with all of that.