Photo Credit via @photosteve101

You have questions, we’ve got answers. Here are some of the most general questions and answers for employees answered. Let’s begin.

1. I’ve heard about a number of different health care proposals over the last year. Which one did Congress pass? The health care reform law is a combination of two bills:

• The Patient Protection and Affordable Care Act (H.R. 3590), which was signed into law on March 23, 2010; and
• The Health Care and Education Reconciliation Act of 2010 (H.R. 4872), which was signed into law on March 30, 2010.

2. Does health care reform allow people to keep their current health coverage? Yes. Nothing in the new law requires individuals to terminate coverage that they had on the date the law was passed. However, due to new coverage requirements, the coverage provided under an individual’s plan may change. Also, employers are not required to offer the same coverage in future years.

If an employer’s health plan existed on March 23, 2010, and the employer has not made certain changes to the plan, the plan may have grandfathered status. Grandfathered plans are subject to many, but not all, of the health care reform law’s requirements.

3. Are individuals required to have health coverage? Not yet. However, in 2014, most U.S. citizens must obtain health insurance coverage or they will be subject to penalties. There are exceptions for low-income individuals and those who are unable to obtain affordable coverage.

4. What are the penalties for individuals who don’t have health coverage? Beginning in 2014, the penalties for individuals who are not enrolled in coverage will be the greater of a flat dollar amount or an applicable percentage of income. The flat dollar amount for 2014 is $95, $395 for 2015 and $695 for 2016. After 2016, the flat dollar amount is indexed for inflation. The applicable percentage of income is 1 percent for 2014, 2 percent for 2015, and 2.5 percent for 2016 and later years. The penalty for children is half of that for an adult. A family’s total penalty generally cannot exceed 300 percent of the adult flat dollar penalty or the national average annual premium for the “bronze” level of coverage through the insurance exchange.

5. Does the new law affect dependent care flex accounts and health flexible spending accounts? Prior to the passage of the health care reform legislation, dependent care flex accounts are capped at $5,000 annually, and health flexible spending accounts (health FSAs) have no cap (although many employers implement their own caps, typically at the $5,000-$6,000 level or less). The new health care reform law does nothing to change the limits on dependent care accounts, which remain capped at $5,000. However, the law does establish an annual cap on health FSAs of $2,500. This change is effective on January 1, 2013. 

6. How do I get my 21-year-old covered under my plan? Beginning with the first plan year after September 23, 2010, insurers will be required to permit children to stay on family policies until they turn 26. This rule applies to all plans in the individual market and to non-grandfathered employer plans. It also applies to grandfathered employer plans; however, the sponsor of a grandfathered plan may decide to exclude from coverage adult children with another offer of employer-based coverage (such as through his or her job). Beginning in 2014, grandfathered plans must cover children up to age 26, even if they have another offer of coverage through an employer. Note that state law requirements may require offering coverage beyond age 26.

7. Is the coverage for my adult dependent taxable? No, the value of the coverage is not subject to federal tax for the employee or dependent. The Health Care and Education Reconciliation Act revised the Internal Revenue Code to clarify that the cost of coverage for a taxpayer’s child is excluded from income through the end of the year in which the child turns 26. However, state requirements may differ, so state taxes may apply.

8. Can I now get coverage for my child who has a pre-existing condition? Effective for the first plan year after September 23, 2010, health insurance companies that cover children will not be able to deny coverage to your child under 19 years old based on a pre-existing condition. This applies to all non-grandfathered and grandfathered plans.

9. What consumer protections will I get if I obtain insurance at work? Effective for the first plan year after September 23, 2010, insurers will be prohibited from placing lifetime limits on what they will pay for your medical care and they can only apply restricted annual benefit limits. Insurers will no longer be able to arbitrarily cancel your insurance policy when you get sick, except in cases of fraud.

Insurance companies will be prohibited from denying coverage to children with pre-existing conditions. This applies to all non-grandfathered and grandfathered plans.

All non-grandfathered group health plans must provide coverage for preventive services. Recommended prevention and vaccination services will be covered without any deductibles or copayments. Plans must also have a straightforward and independent appeals process so you can appeal decisions by your health insurance company.

10. I have a pre-existing condition. How can I get coverage this year? This year, if you have been uninsured for 6 months and have a pre-existing condition, you may have access to health insurance through the high-risk pool program. This temporary program will be available until 2014.   

Have additional questions? Ask us via e-mail, phone, or on our Facebook fan page!

Sources: Department of Labor, Department of Health and Human Services

Saving When You Are Nearing Retirement Age

If you are in your 40s or 50s, you likely feel the pressure of retirement looming just over the horizon. However, there are several actions you can take to ensure that you have saved enough to live comfortably in your golden years. Follow these tips in order to maximize your savings:

• Take advantage of catch-up contributions. Those who are 50 or older at the end of 2011 are allowed to make catch-up contributions up to $5,500 for 401(k)s or $1,000 for IRAs. These contributions are added to the defined contribution limits ($16,500 for 401(k)s and $5,000 for IRAs) for contribution totals of $22,000 for 401(k)s and $6000 for IRAs.
• A minimum of 15 percent of your gross annual salary should be put aside specifically for retirement (assuming you have been putting 10 to 15 percent aside in your 20s and 30s; if not, you should increase your current contribution to at least 20 percent.)
• It is suggested that those in their 40s should have 80 percent of their portfolio in equities and 20 percent in bonds. Those 50 and older should put 60 percent in equities and 40 percent in bonds.
  Find out whether your company offers an automatic contribution escalation, in which an employer automatically increases an employee’s contributions by about 1 percent per year.
• Many financial experts recommend rebalancing your portfolio every few months. This way, as the market fluctuates, your investments will remain relatively stable.
• Be diligent about paying off any outstanding large debts, such as mortgage(s), student loans, wedding(s), and high-interest credit cards.
• It is likely you will need to plan on working up to five years longer than you originally intended due to the fluctuating economy and constant inflation in the cost of living.

Have additional questions? We are here to answer them. Give us a call at 361-855-2500 or send us an e-mail.

Photo Credit via Flickr @NewtonFreeLibrary

Photo Credit via Flickr @kayugee

Although the risk of disease and disability clearly increases with age, poor health does not have to fill your later years in life. Much of the illness, disability and death associated with chronic diseases are avoidable through preventive measures. The secret to aging gracefully is to establish a healthy lifestyle early, and stick to it as you grow older.

Eat Right and Exercise

Proper nutrition, including a diet that is low in saturated fat and contains five or more servings of fruits and vegetables each day, is vital to maintaining good health. Improving your diet as an older adult could extend your life span and reduce the occurrence of chronic diseases like heart disease, stroke, cancer, diabetes and osteoporosis. Regular exercise and physical activity are also important to health and longevity. Regular physical activity greatly reduces the risk of dying from heart disease, and decreases your risk for colon cancer, diabetes and high blood pressure. Physical activity has other health benefits such as:

• Control weight
• Contribute to healthy bones, muscles and joints
• Relieve the pain of arthritis
• Reduce symptoms of anxiety and depression
• Decrease the need for hospitalizations, physician visits and medications

Finally, physical activity does not need to be strenuous to be beneficial. People of all ages benefit from moderate physical activity. However, people tend to be less active as they age. People who are normally sedentary and have lost a tremendous amount of muscle mass can gain it back by increasing strength even with leisurely physical activity.

Stop Smoking

Tobacco use is the single most preventable cause of death and disease in the United States. Cigarette smoking is responsible for one of every five deaths in the United States, or more than 443,000 deaths each year. Tobacco use increases the risk for heart disease, cancer and stroke. Smoking cessation has major and immediate health benefits for men and women of all ages, regardless of smoking-related diseases.

Mind over Matter

Your mind plays an important role in your ability to age well and maintain a high quality of life when you are elderly. Being engaged and maintaining positive social connections can help you retain cognitive function as you age. A healthy attitude can help aging as well:

• Maintain positive self-esteem
• Exert control or autonomy
• Develop quality relationships with others
• View life as meaningful

Have you ever been to the emergency room (ER) for a sore throat or sprained ankle? Though it is tempting to seek immediate care for an illness or injury, you could save a lot of money by choosing your facility more wisely.

A trip to the ER is far more expensive than a visit to your primary doctor or urgent care – and yet, a study by the Commonwealth Fund found that 21 percent of ER visits are avoidable. Steering clear of unnecessary ER visits can save you hundreds of dollars each time you are sick or injured.

Do visit the ER when immediate attention is required, such as trouble breathing, chest pain, heart attack, stroke, broken bones, severe burns or bleeding, shock, poisoning or seizures.

For conditions such as ear infections, vomiting, fever less than 102 degrees F, sprains and strains, upper respiratory infections and headaches, opt for an urgent care facility or your primary doctor instead. In addition to saving money, these options can mean less waiting – a patient with a nonemergency in the ER may wait an hour or more to be seen.

Photo Credit via Flickr @thinkpanama

I recently attended a webinar offered by TrainingIndustry.com which featured Ken Blanchard, author of numerous books on management and motivation, and Colleen Barrett, President Emeritus of Southwest Airlines. It was an engaging webinar that reminded me of my primary aim which I discovered through my work with E-Myth. My primary aim, what really drives me and gives me energy, is to help other folks be successful.

So what does that have to do with the question at the top? Well I was brought up short once more on who my/our customers are here at Arvak Insurance Group.

Southwest Airlines has developed a culture in which their first customer is their employees. It is their belief (and after all these years also their experience) that satisfied employees treat people better and in turn those satisfied people come back and tell their friends about their positive experience. This has a positive effect on the financial performance of the company which in Southwest Airlines case means that their stockholders are satisfied as well.

I see our aim as a company is to provide the opportunities for our employees to excel, to shine, to show off the best of themselves. In turn, this will reflect on our client’s experience, whether it is getting an insurance ID card replaced or appeal a denied claim. Satisfied employees work effectively and create a positive environment. Arvak Employees make Arvak Insurance Group a place that we forward to coming on a daily basis.

Who is your customer and why?