Manage Your Health and Wealth for Maximum Return
May 5, 2010
Vol. 6, Issue 4
It has always been my belief that the more personal responsibility you take for your results, the better off you will be. No matter how good your health insurance is or how good our health care system is, the main determinant of your health is you, your understanding of how to take care of your health, and the actions you take. In a similar way, your financial future will be affected by the economy, taxes, and other factors out of your control – but the more you take responsibility for your situation, without doubt, the better off you will be.
So this month I’ll share a couple tips on managing your health, and some information that may affect your business actions in 2011.
Proactive Health Management
Most of us are pretty good at avoiding major risks that might immediately endanger our lives. We look both ways when we’re crossing the street, we avoid walking alone down dark alleyways in the shady part of town, and if we participate in sports like skydiving we do so with safety equipment and careful procedure. (Yes, I am guilty of letting my son climb trees without full safety gear.)
Wiley IV's Personal Risk Management
So what ends up killing us instead is chronic disease. In fact, 7 in 10 Americans die from some sort of chronic disease, including cancer, diabetes, and cardiovascular disease. But the good news is that these diseases are largely preventable, and usually much easier to treat if caught early.
One of the benefits we offer on our Additional Benefits page is a membership with Direct Labs. This allows you access to wholesale pricing on lab tests, often saving you 70% or more. It also allows you to take more personal responsibility in the management of your own health.
Their package of 10 most important tests includes a complete blood count, chemistry panel, tests for cardiovascular disease risks including fibrinogen, C-reactive protein, and homocysteine, and testosterone or estradiol tests, depending on your sex. The retail price for all these tests is over $1400, but can be purchased through them for just $396.
It is your body, and it is your right and responsibility to know what’s going on in it. If you do see something that is not right, definitely talk to your doctor about it. By being proactive in managing your health this way, not only will you save money but you will also be able to prevent what may be a relatively minor problem, such as high triglyceride levels, from becoming a major problem like diabetes.
How Natural Medicine will be Affected by Health Care Reform
Starting in 2011, you will no longer be able to pay for over-the-counter medication from your HSA. Many of our customers are very proactive about taking care of their health, and many use herbs and other natural treatments to maintain their health.
If you currently use herbal treatments such as gingko biloba, St. John’s wort, or Echinacea, remember that purchases made after January 1 of next year will no longer be HSA-qualified expenses unless you have a written recommendation from your physician.
You will still be allowed to use HSA funds to pay your practitioner, with little limitation on the type of provider you choose. As the government more clearly defines what they consider to be a qualified medical expense, it is important to remember that the money in your HSA always gives you the freedom to decide for yourself what kind of treatment you want, without needing approval from your insurance company (or the Secretary of Health and Human Services!).
New 1099 Mandate
One element of the health care bill that has not been discussed much is a new mandate that will require small business owners to issue many more 1099s. Since so many of our customers are self-employed, I wanted to make sure you are aware of this.
The 2010 Health Care Act has added “amounts in consideration for property” and “gross proceeds” to categories of payments for which a 1099 is required if the amount is over $600, starting in 2011. (If you want to refer this to your accountant, this is Code Sec. 6041(a) as amended by 2010 Health Care Act §9006(b) and Code Sec. 6041(a) as amended by 2010 Health Care Act §9006(b))
This basically means that you must issue a 1099 for any business transactions that you pay for over $600. This would include any purchases (such as office furniture or a used car), office rent, or any other transactions. For the first time, this also includes payments to corporations.
To me, this is a pretty onerous mandate, and I am hoping that once it receives some attention that a change will be made. Not only will it cause massive tax filing headaches for most of us, but also it will flood the IRS with hundreds of millions of new 1099 forms.
Managing your health and putting away as much money as possible in your HSA will put you in a great position. It will allow you to get blood tests that you want, even if they are not on the official list of approved preventive services that will soon be coming out. You’ll have money to get a second opinion or complementary care, even if not covered by your plan. And hopefully, it will help you avoid going to the doctor in the first place.
P.S. - Next month insurance companies will have to have plans in place for implementing the first phases of reform. As the details come out, I’ll let you know what you need to know.