Consumer Driven Experience. What is Consumer Driven Health Care? . Consumer Driven Health Care offers a medical plan partnered with a tax-advantaged account to offset the cost of the medical plan deductible and coinsurance.
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Account owned by the employee
Tax free distribution of funds if used for medical expenses (this includes all 213d expenses as well as qualified long term care insurance premiums and certain medical premiums)
IRS allows distribution from account for non qualified expenses with income tax and 20% penalty tax.
May roll over from year to year and continue to earn interest
May be invested in mutual funds
CDHP with Health Reimbursement Account
Employer provided (and owned account)
Account not portable
Employer decides if other expenses may apply (may include all 213d expenses)
May roll over from year to year
Typically forfeited when leaving the groupDifference between Health Savings Accounts and Health Reimbursement Accounts
* Emerging Data on Consumer Driven Health Plans, May 2009, American Academy of Actuaries
Health Savings Account
Option to reimburse from Health Savings Account for Deductible and Coinsurance or save funds for future medical expenses.
Amount that needs to be satisfied before health coverage begins.
Preventive care not subject to deductible.
Protects member from high costs.
Coinsurance similar to traditional plans.
Out-of-pocket maximums are in place for added peace of mind.
$0 – Physical
$150 – Prescriptions
$75 – Doctor’s Visit
$125 – Urgent Care
= $350 Total Expenses
Your HSA Account
$750 from OC
$750 self contributions
Your HSA Account
= $2,650 Balance
Maximizing Value for Tax-free Growth
*Interest rates are subject to change.
Maximizing Value for Tax-deferred Growth