BASE^® Blog

As health care expenses continue to increase, tax-advantaged health plans can be a cost-effective way to offset health care expenses.  Two of the most popular – HSA and FSA.  Both provide tax savings on health care costs and can make managing out-of-pocket health care expenses easier throughout the year.  But who would win in a boxing match?

Let’s meet tonight’s matchup! 

Fighting in this corner, a special type of bank account designed for individuals, enrolled in a High Deductible Health Plan (HDHP), to save and pay for qualified health care expenses, with the opportunity to save for the future, and the potential to be used as a powerful tool to diversify retirement portfolios.  This contender also provides excellent tax benefits helping to make the most out of every health care dollar…it’s the Health Savings Account (HSA)!

And fighting in this corner, an account for employees to elect pre-taxed funds, up to the IRS annual maximum, to pay for qualified health care costs.  Subject to certain rules with unspent funds at the end of the plan year its… the Flexible Spending Account (FSA)!

As Michael Buffer would say, “Let’s Get Ready to RUMBLE!”  Let the 12 rounds begin! 

Which plan is the undisputed champ for your business?

At the end of the fight, there are no losers, only winners!  Regardless of which of these savings solutions an employer chooses, each can help the employer provide a cost-effective employee benefits solution, employees pay for out-of-pocket medical expenses, and both save valuable tax dollars.

In this match-up, the HSA and FSA cannot be teammates in the ring, but the HSA can team up with a Limited Purpose FSA.  The LPFSA allows employees the opportunity to build contribution amounts in the HSA while still receiving a pre-tax benefit for eligible dental and vision expenses.   

For more information on the BASE® Health Savings Account (HSA), BASE® Flexible Spending Account (FSA), or the BASE® Limited Purpose Flexible Spending Account (LPFSA), call 888.386.9680 or visit www.BASEonline.com.

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It has been a full year since the Excepted Benefit HRA has been available for businesses.  Unlike the name suggests, the EBHRA offers much more than just the reimbursement of “excepted benefits” in ways of INTEGRATION, DESIGN, & ELIGIBILITY.

The BASE® Excepted Benefit HRA (EBHRA) allows employers, who offer a group health plan, to reimburse employees an additional $1,800 for premiums paid towards excepted benefits that are not included in a traditional group health plan.  Some excepted benefits are COBRA, dental, vision, short-term medical plans, and other qualifying out-of-pocket medical expenses.

The BASE® EBHRA is available to businesses of ALL sizes looking to maximize tax benefits for their business while expanding the benefit package for their employees.  This HRA is for employees that have been offered the employer-sponsored group health plan but are not required to enroll to participate in the EBHRA.

In 3 ways the EBHRA offers more:

INTEGRATION:

While other HRAs, such as the Individual Coverage HRA (ICHRA) and Integrated HRA, must integrate with either an individual health insurance plan or the employer-sponsored group health plan, the EBHRA does not.  The sponsoring employer MUST OFFER the EBHRA in conjunction with the employer-sponsored group health plan, however, the employees are not required to enroll in the group health plan to participate in the EBHRA. 

Simply put, if the employer wants to provide the EBHRA to their employees, they must offer an employer-sponsored group health plan.  It is up to their employees if they want to participate or not.

DESIGN:

The EBHRA is designed for uniform availability meaning it must be offered on the same terms and conditions to all eligible employees.  The employer gets to determine what expenses to reimburse and how much will be reimbursed up-to the maximum of $1,800 (indexed for inflation) per plan year to employees. 

Simply put, the employer must provide the EBHRA to all employees, but can choose how much they will provide up-to $1,800. 

ELIGIBILITY:

Final regulations leave the assumption that the employees eligible for the EBHRA must be eligible to enroll in the employer-sponsored health plan, even if they choose not to.

Simply put, the employees must be eligible for the employer-sponsored group health plan, but do not need to enroll to take advantage of the tax savings with the EBHRA. 

With the EBHRA, we want you to experience the BASE® Difference!  With BASE®, employers will have an additional way to maximize their tax benefits for the business and their employees, by providing a tax-free means of paying for COBRA, Short-Term Limited Duration Insurance, and Excepted Benefit Insurance and/or IRC Section 213(d) medical expenses.  Employees will have up-to an additional $1,800, tax-free, to apply towards these benefits.

Simply put, the EBHRA can offer benefits to both the employer and employee, allowing both to maximize their tax savings.  For more information, call BASE® at 888.386.9680 or visit www.BASEonline.com.

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