Cloud & Associates Blog

If you’re not happy with Obama Care and are not keen on putting your health care decisions in the hands of a company that cares more about managing its profits than it does about your health, A HSA, Health Savings Account may be a good option for you.  The agents at David C. Cloud with their years of experience have compiled the newest updates and legislative action that effects health care and have put it together in a manner that explains all your options without the legal Mumble Jumble of the IRS.

There are primarily four types of Personalized Health Care Accounts.  They are commonly referred to by their initials such as HAS’s, FSA’s, MSA’s, and HRA’s.  We can consider these accounts to be various vehicles or tools to maximize our health care options and strengthen our tax advantage.  Below are the basic types of Health Savings Accounts:

• Health savings accounts (HAS’s).
• Health flexible spending arrangements  (FSAs).
  • Medical savings accounts: Archer MSAs and Medi-Care Advantage MSA’s.
  • Health reimbursement arrangements   (HRA’s)

Each of these accounts has a different set of rules and requirements along with different advantages and disadvantages.  We here at David Cloud and Associates,  highly encouraged you to  seek out professional advice when  deciding  which account is best suitable for you, as there are serious and potential tax disadvantages between each type of account.  Let’s start with the HSA, Health Savings Account.

An HSA is a pre tax account that you, the holder of the account, can contribution into.  A family member may also contribute to your account.   The amounts that you or your spouse, if filing a joint return are Tax Deductible.  Your employer may elect to make contributions to your HSA; however the amount that your employer contributes is not tax deductible on your return.  The money contributed from your employer is not considered income to you.  If a person other than a family member or individuals listed on your return contributes to your plan, there are different rules for them.  Distributions from a Health Savings Account that used to pay qualified medical expenses are not taxed or treated as personal income.

Here is some important legislature that applies to Health Savings Accounts.  Any medicine or drug will be a qualified medical expense only if the medicine or drug:

1.  Requires a prescription,

2.  Is available without a prescription (an over-the-counter medicine or drug) and you get a

Prescription for it

3.  Is insulin.

Some of the benefits of a HSA, Health Savings Account are that they allow you to claim a tax deduction for the amounts you or a family member contributed to your plan, even if you do not itemize your deductions on your tax return.  The contributions made into your HSA from your employer, including contributions that were made from a cafeteria plan in most circumstances are not treated as income to you. With an HSA, unlike some other plans, the contributions in your account are not subject to the “Use it or Lose It” clause and remain in your account year after year until you use them.  The earnings and profits made on these accounts are also tax free.

.

David Cloud and Associates can guide you through this and help you establish the best account for you.  As you can see, there are many rules that apply to HSA’s, yet the benefits are great.   Stack the deck in your favor, take back a little control over your health and money and put it back where it belongs, in your hands.  Let David Cloud give you a voice and a choice in managing your family’s health care decisions.  This option allows you to keep the change in your pocket, where it belongs.

WASHINGTON — A Democratic senator, Ron Wyden of Oregon, and a Republican member of the House, Paul D. Ryan of Wisconsin, unveiled a bipartisan plan on Wednesday to revamp Medicare and make a fixed federal contribution to the cost of coverage for each beneficiary.

The lawmakers aim to reshape the debate over the giant health insurance program by addressing concerns that have provoked fierce opposition to similar ideas in the past.

Just as important as the details of their proposal was the fact that the two were working together on an issue that both parties have exploited for political advantage.

In 2010, many Republicans won House seats — and the support of older voters — by arguing that President Obama’s health care law would damage Medicare. Democrats are hoping to retake the House by arguing that Mr. Ryan and other House Republicans are pushing for the privatization of Medicare, which they say could greatly increase costs for beneficiaries.

The new Wyden-Ryan proposal, by blurring the contrast between the parties on this issue, could make it more difficult for Democrats to win the argument.

The proposal would make major structural changes in Medicare and limit the government’s open-ended financial commitment to the program.

Under the proposal, known as premium support, Medicare would subsidize premiums charged by private insurers that care for beneficiaries under contract with the government.

Congress would establish an insurance exchange for Medicare beneficiaries. Private plans would compete with the traditional Medicare program and would have to provide benefits of the same or greater value. The federal contribution in each region would be based on the cost of the second-cheapest option, whether that was a private plan or traditional Medicare.

In addition, the growth of Medicare would be capped. In general, spending would not be allowed to increase more than the growth of the economy, plus one percentage point — a slower rate of increase than Medicare has historically experienced.

To stay under the limit, Congress could cut payments to providers and suppliers responsible for the overspending and could increase Medicare premiums for high-income beneficiaries, the lawmakers said.

The proposal is sure to come under fire from beneficiaries and Democratic lawmakers who see themselves as the pre-eminent defenders of Medicare.

For his part, Mr. Wyden said: “Medicare is the most important fiber in the social safety net. I would never do anything to shred it, weaken it or harm it in any way. Our proposal places traditional Medicare, long supported by progressives, alongside a menu of private alternatives that provide the choice and competition long supported by conservatives.”

Unlike the Ryan budget blueprint approved by the House in April, Mr. Ryan said, the new proposal would preserve the traditional fee-for-service Medicare program as an option for all beneficiaries. “Our proposal harnesses the power of competition to address the root cause of medical inflation,” said Mr. Ryan, the chairman of the House Budget Committee.

Democrats expressed concerns about the proposal based on policy and politics. A senior Democratic Congressional aide said, “This plan gives bipartisan political cover to Ryan and other Republicans against whom we have been waging a very successful political offensive.”

from BigHealthReport.com

Most of us remember the 1997 Steven Spielberg movie!  Richard Dreyfus plays Roy Neary who chases his vision of a spacecraft into a remote area where he and others experience a "close encounter of the third kind" - contact with ET! Well, if this happens to you, you can now rest assured that the Federal regulations will have a code for it in their new release of the ICD-10 medical diagnosis codes.

A new federal law is about to expand the number of medical-insurance codes dramatically.  The International Classification of Diseases (ICD) Codes are the  classification codes used by hospitals and doctors to diagnose and describe a patient's illness and injuries. The Health Insurance Portability and Accountability Act of 1996 (HIPAA) requires these codes be used by health plans, health care providers and related services when electronically submitting claims and such. This does of course affect Medicare and Medicade patients and some non-government services. But, it will also undoubtedly affect every one of us and our providers due to the new health care act passed last year.

According to the Centers for Medicare & Medicaid Services (CMS) ICD-10 Website, the old codes ICD-9 are outdated. The 18,000+ codes don't allow them to be specific enough. They are about to be replaced with a new ICD-10 code.  The new law will result in about 140,000 codes. This is expect to be the most complex, expansive and expensive code change in history. Industry analysts expect it to exceed Y2K with respect to cost and impact. The governments' own site states, "Every standard has been updated, from claims to eligibility to referral authorizations." www.cms.gov

So, OK where were we? One web company is advertizing that its ICD-10 training can be fun! So how much fun can we have with this one! Think about this:

If you step on a turtle - which causes you to walk (please walk, don't run, don't think they have a code for running)  into a lamp post - at the pool behind your neighbors mobile home - while you are distracted by the crash of a spacecraft, which injures the occupant, there are codes for that!

W5922XA - Struck by a Turtle, initial encounter
W2202XA - Walked into lamppost, initial encounter
Y92026 - Swimming-pool of mobile home as the place of occurrence of the external cause
V9541XA - Spacecraft crash injuring occupant, initial encounter

Oh wait, wrong code! we weren't struck by the turtle, we tripped over him/her/it!

W5929XA - Other contact with turtle, initial encounter

So, where does the "Third Kind" come into play? How about these codes?

1.) V9541XA - Spacecraft crash injuring occupant, initial encounter
2.) V9541XD - Spacecraft crash injuring occupant, subsequent encounter
3.) V9541XS - Spacecraft crash injuring occupant, sequela

And heaven forbid you are a "sequela" which a dictionary defines as "A pathological condition resulting from a disease." Yea, second definition defines it as "A secondary consequence or result", but they have a code for "subsequent encounter". Maybe the "Third Kind" can be used for an alien abduction!

Are you ready for new HIPAA X12 5010 & ICD-10 standards? Version 5010 (which is a whole 'nuther update) standards for electronic health transactions start on January 1, 2012.  ICD-10  for medical diagnosis and inpatient procedure coding on October 1, 2013. Don't you just love it?