Its been years since I heard one of those stories about some poor soul who got severely sick and then was boned by their insurance company over a “pre-existing condition”. I like that, pretty much want to keep it that way. Find it soothing to the nerves.
He’ll fuck his supporters on trade. He might throw them a bone on immigration.
Wouldn’t surprise me in the least. Screwing people over is practically what he’s about, at least if they’re not in any position to do anything about it. Which describes most of his supporters perfectly.
“You fucked up, you trusted me” should be his motto.
He’s even stiffing his own pollster.
There are flex spending accounts (FSA) and health savings accounts (HSA). FSAs are use-it-or-lose-it; HSA funds don’t expire, and work just like an investment account–the funds can be put into the stock market. Both are tax-free. I have an HSA and the company makes a contribution on my behalf. It’s obviously not a replacement for a health plan, but it’s a nice adjunct to a high-deductible plan.
Right. I used to work for one of the largest benefits outsourcing companies in the U.S. and I still don’t understand why FSA’s exist at all. You lose it all if you don’t use it during the fiscal year and your company is the one that gets to keep the money which is really perverse. However, there is a flip side as well. You can use all of your declared contribution for the year the first day the plan starts and then quit to take a new job. Your company simply has to eat the loss because turnabout is fair play. I have no idea why anyone ever thought that was a good design but FSA’s are still fairly popular.
HSA’s actually make sense. They are just tax-free savings accounts for a wide range of medical and dental procedures. I have one now and think they are a great idea. You can build up quite an emergency medical fund if you contribute the maximum and don’t need it for years at a time. They should be encouraged. However, they are just a supplement to health insurance and not a replacement for it especially in their present form. The contribution limits are way too low to cover even a single emergency per year (I think it is $3000 a year for a single person right now and proportionally lower for a family).
Dude, you mispelled “Liar”…
They are pretty weird but I guess they make sense for people with chronic illnesses and predictable health costs. I have zero health costs in a typical year, but when I do have expenses they’re pretty high (and unpredictable). So it makes no sense for me to contribute to an FSA because I’d be wasting most of it. An HSA as a buffer to cover the deductible makes lots of sense, though.
That makes sense, but His Trumpness seems to think an HSA can take the place of health insurance.
Trump has never spent more than 15 seconds thinking about anything, and most of the policies he suggests reflect this.
Still, its remarkable how wrong he can be in such a limited time.
When was the last time you think Trump thought about health insurance as an actual person needing it, and not as the person that has to control costs to his own company for providing it?
I really don’t understand why they’re a good idea. Why can’t I just keep my money in my regular savings account? If you want to make medical expenses deductible for tax reasons just make them deductible for tax reasons. Its weird to force people to predict ahead of time what their expenses are going to be for something as potentially unpredictable as health care. Its weird to make whether health care costs are tax deductible or not dependent on your employer choosing to offer this. How much of this is really the optimal design for the problems at hand and how much of it is lobbying by companies that get to administer these plans for a fee?
And don’t get me started on the plethora of use-it-or-lose-it savings accounts. Health care, dependent care, commuting. All requiring you to make decisions a year in advance about your spending where if you calculate wrong you get to throw a bunch of your money into the trash.
[thread hijack]I administer Flex plans for a living. Just wanted to make a couple comments about them.
First, don’t use them for “emergency” procedures. No one can plan such events. I recommend you use them for things that are easily calculated, such as co-pays for regular doctors’ visits for the year, maintenance prescriptions such as blood pressure, thyroid, diabetes meds, supplies for diabetes, vision care and the like. Example: If you know you’re going to visit your GP at least once a year, factor in one doctor’s co-pay. Maybe you take Lipitor and you know what your co-pay is for your monthly prescription. You know what your dentist is going to charge you for a cleaning, a filling or a crown. Going to buy a new pair of glasses and visit your eye doc? These expenses generally qualify. Total it all up and that’s the amount to run through your Health FSA. It really shouldn’t take you that long. If you’re nervous about use-it-or-lose-it, dial the amount back by 20%. I guarantee you won’t leave a penny in that account and will probably have used it all up by July.
Second, many employers have adopted the rollover option now featured on these plans. This permits you to roll over up to $500 in any year in case you didn’t calculate well, or added in an expense that turns out to not be covered. It’s a safety net. Check to make sure your employer adopted it (most did).
Third, you would literally need to leave more than a third of your annual election plus the $500 rollover amount in your Health FSA before you lost one dime more than someone who doesn’t participate in the plan at all.
Let’s say you decided to put $1,000 through your Flex plan. At the end of the year, you still have $1,000.00 and find you were careless and failed to save your receipts. The rollover option allows you to salvage $500 by rolling it forward into the new plan year. Your tax savings on $1,000 is going to be a minimum of $300, realized through your tax savings at the time of payroll withholding. So your net loss would be $200. Someone who didn’t participate at all will lose $300 (the 30% of tax savings he/she didn’t realize because they didn’t enter the plan, for medical expenses they nonetheless paid for).
Obligatory disclaimer: Employers have wide discretion to determine what services/products qualify for tax-favored treatment through their Flex plan, so be sure to check yours particularly before calculating your annual election. The expenses I suggested are very commonly-allowed expenses, however.
You really have to be careless to lose money in a Health FSA through your Flex plan.[/thread hijack]
Those are all true statements by they also highlight why the U.S. healthcare system and the tax codes in general are still a gigantic mess. You shouldn’t need to be psychic or even break out a spreadsheet to keep the money you put into any type of health savings account. The people calling for simplifying the tax codes have a very valid point. The rules for FSA’s are simply bizarre and very risky if you don’t calculate properly. HSA’s are much better because you don’t have to “use it or lose it” but are still generally a losing “investment” because of administrative fees.
None of this is sane or has to be this way. It would be much simpler to just let taxpayers take a tax deduction (not a credit; there is a huge difference) on qualified medical expenses. Unfortunately, you can’t do that with the current tax code because it requires itemizing your expenses and most people don’t do that. The only real solution is to overhaul both the entire tax system and the medical system and you have seen how that has worked out so far. It is a gangbang clusterfuck pure and simple and something has to give some time soon.
The international company that I work for has always prided itself on providing “free” healthcare to its employees. That was great in the beginning but then they had to go to high deductible plans two years ago that were basically unusable except for basic care and catastrophic accidents. We all got the email today that, thanks to ObamaCare, the multi-thousand dollar deductibles are not only going up but we also have to pay hundreds of dollars a month for coverage that the vast majority of us can never use unless we are terminal and desperate. This whole house of cards will fall at some point in the near future because it is completely unsustainable and irrational.
There is no simple solution to this problem at all and anyone that claims otherwise is either completely ignorant about everything or lying.
Oh, I completely agree with all you’ve said. I will gladly be put out of business for our nation to pursue a sane health care system. I’m a single payer supporter to the bone. I was simply pointing out how to use the Flex plan you have, until something better is worked out (if ever).
Moreover, HSAs are fine except for the reason you point out: Administrative costs offset your tax savings if you leave your employment and have to bear those costs yourself. Banks profit from this, so they love HSAs.
Your greatest tax savings are realized within the system we currently have when you utilize both a Flex Health FSA and an HSA. Since participation in an HSA means you can only use a Limited Purpose Health FSA for vision and dental care costs, calculate those separately and run them through your Health FSA. That allows you to preserve your HSA funds. Since vision care and dental care are frequently high dollar expenses and often foreseeable and easy to calculate, it’s a good way to go for now.
I agree it’s all nuts when compared to single payer.
With respect to the OP, Trump’s plan is simply a way to shift costs for health care from employers to individuals. Unless/until we get health insurance companies and the profit motive out of our health care system, it will be like putting a band aid on an amputation. And you can bet that those companies profiting from our health care system will pull out all the stops and an almost unlimited amount of money to scare us into thinking what we truly need is bad for us.
Same here basically. It makes the deductible I got stuck with after the ACA a lot easier to take (especially since this year we crossed that line) but I can’t see it as a total replacement for health insurance.
What also gets lost in these discussions is the fact that health care costs are incredibly concentrated - roughly half the population uses a negligible amount of health care, and half of health care costs are incurred by only 5% of the people. It’s a big country, so that’s still millions of people we’re talking about.
If you’re unfortunate enough to be in that 5% of people who are simply sick, for lack of a better word, then HSAs and flex savings accounts are not going to be sufficient for you. As a society we can either extract money from the healthy 50% of the population through taxes / single payer / ACA / guaranteed ER treatment / something similar, or we can tell those people they have to suck it up and either deal with it or die. There are more and less efficient ways of dealing with this problem, but it’s not simple.
Typical Republican answer - Tax Credits - which ignores the fact that too many people don’t have enough money and don’t make enough money for tax credits to make a difference.
Kinda like when I divorced and my ex-father in law wanted to give me a 1099 for the $15k I’d paid toward my ex-wife’s house. Since I’d had negligible income in the year, a 15k tax deduction was worthless to me.
I used to work for an FSA administrator – as the Communications Manager. I was in charge of producing the educational materials to inform customers about their FSA plans. The only point I don’t see being made here is: If you itemize, yes, you can claim deductions for qualified medical expenses, IF the total cost of those expenses exceed 7.5% of your salary. Section 125 plans (dependent care and healthcare flexible spending plans) were created to bridge that gap up to 7.5% of your salary. It takes a* lot* of illness to add up to 7.5%. (DISCLAIMER: That percentage may have changed in the 15 years it’s been since I last worked in that industry.)