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Obama's Bill to Aid COBRA

On February 17, 2009 President Obama signed into law the American Recovery and Reinvestment Act (the “Act”). This stimulus bill was designed to address our current economy crisis and includes several changes to COBRA including a 65% federal subsidy for COBRA  premiums to qualified beneficiaries! 

The federal subsidy is available to qualified those receiving COBRA continuation due to a covered employee's involuntary termination of employment between September 1, 2008 and December 31, 2009.  These are referred to as "Assistance Eligible Individuals" or "AEI".  It's  important as an employer to identify these Assistance Eligible Individuals as soon as possible so necessary actions can be taken when ready. 

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HSAs & High Deductible Health Benefits

Our economy is changing, the healthcare industry is changing, and the health insurance industry is changing to reflect these trends.

Health Savings Accounts (HSAs), combined with high deductible insurance has become not only popular but commonplace as health insurance premiums increase.  Money previously spent on higher premiums are now funneled into the employee-owned HSAs to pay out-of-pocket medical expenses until the higher deductible is reached.   HSAs are funded with payroll-deducted pretax dollars, providing a tax saving to both employer and employee. 

Employers benefit by providing this type insurance; contributing to both the employee’s HSA & insurance premium, you can still pay less than what the older, more traditional types of coverage would cost.  Since high-deductible insurance does not provide coverage until the stated deductible is reached, the insurance premium is much lower than the more common HMO & PPO coverage available.  

 

Employees benefit too.  While it takes a little to get used to, it feels good to have more control over your healthcare and healthcare costs.  And many HSAs provide prepaid Visa/MasterCard Debit Cards which make HSA spending and expense tracking easy and straightforward.  Your employees can use the debit card at the doctor's office & drugstores for not only prescriptions but also over-the-counter qualifying healthcare purchases (aspiring, allergy medicines, bandages, etc.).... all with pretax dollars.  Plus, unused HSA dollars can carry forward to next year. 

 

Please keep in mind that many plans differ in coverage.   You'll want to match your HSA contributions to the annual deductible of the companion policy.   Call Carole Shaffer at The Shaffer Group - 877.286.1359, Ext. 1041 for more information and a comparative quote from multiple insurance companies. 

 

 

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Changes in Life Insurance

Now that we are living longer, life insurance policies are costing less and are adding Long Term Care coverage riders, so you're protected in any situation. 

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New IRS 2009 HSA Contribution Limits

May'08- IRS Statement 

Maximum 2009 HSA contributions 

 will be as follows:



Single Coverage - $3,000

(up from $2,900 - 2008)  

Family Coverage - $5,950

(up from 5,800 - 2008) 

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Last modified: 12/09/10