Retirement planning always involves your spouse, so that the two of you can plan for the future together. But when a large age gap exists between you, you will face a few more challenges. You’re less likely to retire at the same time, and this can lead to more consequences than you might think. So, if one of you is much older than the other, look more closely at these three areas of retirement planning.
Social Security. If your spouse is much younger, then there is a good chance he or she will outlive you. Therefore, there might come a time during which they need Social Security survivor benefits. If you’re the higher income earner, or if your spouse doesn’t have a work record at all, then claiming your benefits too early can leave them with less to live on.
Timing of Social Security claims is complicated for everyone, and even more so when there is a wide age gap between spouses. Examining all of your options carefully, and working with a financial professional, can help you decide which path to take.
Long-term care. An estimated 70 percent of retirees will need long-term care at some point. You might plan to rely upon your spouse for your care, but there are two problems with this plan:
- He or she might not possess the nursing skills required, meaning you still need a nursing home or in-home nursing provider
- Your spouse will likely outlive you, and who will provide their nursing care when the time comes?
The average annual cost of a nursing care facility is $82,000 to $92,000 per year. Luckily, long-term care insurance can cover this cost, if you had the foresight to enroll in a policy. Let’s talk about that now, before you retire, because enrolling in a policy at a younger age will mean more affordable premiums.
Health insurance. What if your spouse relies upon your health insurance, provided through an employer? If you retire at 65 or later, you will enroll in Medicare… But what about your spouse? They will be left without health insurance, and taking on that expense can be risky.
You have several options, such as working until they are eligible for Medicare, but that might not seem realistic if your spouse is a decade (or more) younger. Purchasing a health insurance plan independently is probably the safer way to go. Give us a call and we can walk you through your health insurance options.
When you’re suffering a minor health condition, the last thing you want to do is get dressed and drag yourself into a stuffy doctor’s office. You don’t want to infect other people, and you certainly don’t want to expose yourself to even more germs. But in the past, that was our only option.
Finally, we have a solution for these situations. The healthcare field has evolved to allow phone consultations for many minor conditions. This option can be better for all of us, reducing the unnecessary spread of colds and other minor illnesses. Plus, it’s much more comfortable and convenient for you, the patient.
These appointments are now available in California, depending upon your provider and insurance plan provisions.
It’s important to remember that there will always be some situations in which an in-person visit is necessary. Phone appointments are best used for conditions such as:
- Colds or respiratory infections
- Follow-up appointments regarding previous treatment
- Other minor, non-emergency illnesses
Telephone consultations are not appropriate for:
- Possible broken bones or sprains
- Severe shortness of breath
- Chest pains
- Severe abdominal pain
- Psychiatric emergencies
- If urgent care is required, call 911 or go to the closest emergency room.
How it works. When you call for a phone consultation, you will be asked to confirm that you are at least 18 years old and that you have previously attended one face-to-face meeting with this provider. If so, a one-hour window will be scheduled for you, during which your doctor will call you back.
It’s really that simple! And the best part is, you won’t even have to change out of your pajamas. For more information on telephone appointments, call your primary care provider or your health insurance representative.
As a business owner, your to-do list is never lacking. It doesn’t help that as the business world changes, growth, increased regulations, and changing procedures can sometimes increase the amount of time you must spend on operational tasks. Once simple and straightforward, benefits enrollment has become more complicated and time-consuming in recent years.
We aim to address that problem for you, and we’ve found that online benefits enrollment is often the solution. In fact, nearly 50 percent of businesses are now utilizing benefits administration software, and it’s succeeding because…
The benefits enrollment process is simplified. Say goodbye to paper forms and delays due to written errors. Creating digital files ensures that you spend less time collecting and reviewing forms, determining eligibility, and communicating details to employees. Employees love online enrollment because they can easily compare their benefit options and choose the ones that best suit them.
Happy employees are loyal employees. Research has demonstrated that when employees understand their benefits, they are more loyal to their employers. Online enrollment offers them 24-7 access to their benefit details and educational resources to help them best utilize their insurance plans.
You can manage benefits more efficiently. Online enrollment allows you to view enrollment progress in real time, and track new hires’ onboarding and benefit elections. Your HR department will thank you for the improved efficiency.
These are just some of the primary benefits of an online benefits enrollment system. For more information on how online enrollment works, and how it will suit your business specifically, give us a call and we’ll review the finer details with you.
Sharing of premium payments, between employers and employees, has become a common method of providing a comprehensive benefits package while managing the associated costs. Under this type of arrangement, your employees can access group insurance plans (most notably, health insurance). At the same time, you are able to put a cap on your own expenses, by covering premiums up to a certain amount and then allowing employees to share in the cost.
This arrangement provides benefit not only to your employees, but to you as well. But of course, you face certain responsibilities as well.
Fiduciary responsibility. As the employer, you withhold from paychecks the employee’s contribution to the benefit plan. As such, certain regulations govern the handling of these funds. Employers are under fiduciary responsibility to use those funds only for the purpose of insurance premium payments, and payments must be made in a timely manner.
Consequences for missteps. Accounting is no small task for business owners, and mistakes can be made. But with regard to the aforementioned fiduciary responsibilities, mistakes in this area can be costly.
Late premium payments can trigger lapses in insurance coverage, causing no small amount of inconvenience and hardship to employees. The courts recognize these situations as a serious problem, and employers who lapse on insurance payments can face legal problems such as lawsuits. Failing to appropriate employee contributions correctly also results in stiff fines.
Income tax obligations. In addition to fiduciary responsibility, you are tasked with keeping appropriate records for tax purposes. The IRS takes a serious view of pre-tax contributions, and lack of appropriate documentation can lead to trouble with auditors. In this case we are talking about Section 125 documents; these must be set up properly, and kept secure in the event that a review becomes necessary.
Section 125 adds yet another task to your accounting regimen, but it is one of utmost importance.
Sharing the cost of insurance premiums is certainly a worthwhile endeavor for both employer and employee, but as you can see, it is also no simple matter. We urge you to contact us if you have any questions about your benefits plan, and the associated regulations and documentation. We can explain your benefits plan in greater detail, and help to ensure that everything is in order.
If your son or daughter is graduating from college, please pass on our congratulations to him or her! They have fulfilled an important promise to themselves, that will greatly impact their future.
Now it’s time to evaluate another big life decision: What will your child do about health insurance?
If they enrolled in their school’s health insurance plan for students, that plan will probably expire soon. The first thing your new graduate should do is call the plan administrator, and ask how graduating will affect enrollment in the plan. Since health conditions or accidents can strike at any age, going without insurance can create a significant financial risk. Now it’s time to begin evaluating their options.
Option One: Join a parent’s health insurance plan.
If your own’ health insurance plan covers dependents, children under age 26 can usually be added to it. Of course, this plan might, or might not, be a good fit for your child personally. Check the details carefully, so that you both understand provisions such as co-pays, deductibles, coverage limits, and provider networks.
Option Two: Enroll in an Individual healthcare plan.
Talk about “adulting”! Shopping for their own Individual healthcare plan can feel like a daunting process to your graduate, but it’s just one of a series of decisions that lead to greater independence.
Normally, consumers can’t enroll in a health insurance plan outside of the annual Open Enrollment period, which begins in November. But your child might qualify for a Special Enrollment Period if they meet one of these circumstances:
- They’re losing your current health insurance (such as a school plan)
- They’re dropping off of their parents’ plan
- They’re moving away from the place they attended school
- They experience other major life changes, like getting married or having a baby
The easiest way to know whether your young graduate will qualify for a Special Enrollment Period is to simply ask! Give us a call, and we can help you and your child evaluate the options and decide how to proceed.
Health insurance offers significant medical security for your family, along with the obvious monetary benefits. In the event of large medical bills, your insurance will kick in to cover charges over the amount of your annual deductible and co-pays.
Yet, for some people, reaching that deductible still presents a challenge. For example, if your deductible is set at $6,000 per year, this means you will pay for the first $6,000 in medical bills before your insurance plan takes care of the rest. If you’re like a lot of people, perhaps $6,000 dollars in medical bills sounds like a heavy burden to shoulder all at once.
A health savings account offers a creative solution to this problem. With an HSA, you can set aside pre-tax dollars in a special savings account. The money can be used on qualified healthcare expenses, such as co-pays, deductibles, and prescription medications.You can also access your HSA to pay for uncovered medical expenses, like vision and dental services. For convenience, you can even have the money diverted directly from your paychecks and into the account.
If you don’t use all of the funds in your HSA during any given calendar year, the money is not lost. Funds roll over from one year to the next, and you can even carry the account with you into retirement. At that point, any unused funds can be used for Medicare premiums and other qualified medical expenses. So, not only can an HSA help you now; the money will always belong to you and can even be used as a secondary way to save for medical bills in retirement.
Since the funds are deposited on a pre-tax basis, you won’t owe income taxes on the amount you divert into the HSA. In this way, an HSA can also function as a valuable tax benefit.
Only some health insurance plans allow for a health savings account, most notably the Bronze high-deductible policies. To find out whether you’re eligible for a health savings account, give us a call. If you already have an HSA Qualified Plan, set-up your HSA, don’t delay. If you do not, it is something to consider at the next Open Enrollment when you can change plans.
Going without health insurance brings significant financial and health risks into your life. Luckily, even if you quit your job or get fired, COBRA allows you to continue accessing your employer’s group health insurance plan. Of course, the problem with this scenario is that you will often incur high expenses, because you’re now paying your previous employer’s part of the premium in addition to your own. Luckily, if you feel like COBRA coverage will be too expensive for you, there are some other alternatives.
Utilize the state exchange. Losing your job (and health insurance coverage) qualifies you for a Special Enrollment Period through the state health insurance exchange. You might also qualify for a subsidy to help cover the cost of premiums.
Independent health insurance. An independent health insurance policy can sometimes offer suitable coverage for lower premiums than COBRA. You can choose deductible and copayment plans that suit your needs, and this coverage can last as long as you need it.
High deductible health insurance. These types of plans offer low monthly premiums, but the high deductible means you’re responsible for a considerable amount of medical bills before the insurance kicks in to cover the rest. If you choose this option, you will be eligible for a health savings account, which can offer significant tax benefits.
Sometimes just staying with COBRA is your best alternative. There is more to consider than just the cost of COBRA. Have you met your current plan’s deductible or out of pocket maximum? Do you have a surgery scheduled or need another service in the near future? This is why you should always contact a qualified insurance agent to discuss your particular situation and review the best options for you.
If you’ve lost your job, or feel that an employment change is imminent, give us a call. We can help you evaluate your health insurance options and choose a path that works for your situation.
Your health insurance plan does more than just protect your family’s health. It also protects your budget, by helping you manage expenses. But there are several ways to wring a bit more value from your plan…
Make sure you have the right plan. You wouldn’t use the wrong tools to accomplish a particular task, so why use the wrong health insurance plan to protect yourself and loved ones? It’s tempting to automatically re-enroll in your current plan each year, because it’s one less task to tackle. But really, you should be re-evaluating your family’s needs each year, and comparing those needs to your plan’s provisions.
Understand your plan. Upon enrollment, your health insurance company will send you a packet of information. Take the time to review this information, and hang onto it for later reference.
If you’ve met your deductible, take advantage. If, and when, you meet your deductible for the year, go ahead and schedule other screenings or procedures that you might have postponed earlier. You’ll be getting them at reduced cost now.
Use in-network providers whenever possible. Before utilizing any medical facility or doctor, check with your insurance company to be sure they’re in-network. Only use out-of-network providers when absolutely necessary.
Try mail-order prescription services. Check with your insurance provider to see if they cover mail-order prescription services. You can save money by ordering a 90-day supply of your prescriptions, rather than standing in line at a local pharmacy each month.
Consult with a medical billing advocate. Hospitals can, and do, make errors in billing. Sometimes those errors amount to thousands of dollars! When you encounter high out-of-pocket costs, consult with a medical billing advocate. Consultation is usually free, if your bill turns out to be correct. If the advocate succeeds in reducing your bill, their fee is usually about one-third to one-half of the amount saved. Your insurance company might even offer this advocacy service.
Stay in touch. Health insurance companies sometimes add special services and perks to their roster of offerings. Read any emails or snail mail they send you, and check their website frequently for updates on free screenings, wellness programs, handy apps, and more.
If you choose to offer your employees a dental care plan, providing them with a valuable health benefit is probably your primary motivation. However, when your employees take advantage of those plans, particularly preventive dental care, you also reap the benefits.
According to a study by Guardian Life Insurance Company of America, companies that encourage employees to use preventive dental care can slash the cost of group policies for their employees.
The study analyzed claims data from 2011 to 2017, and divided employers into two groups: high-preventive-utilization and low-preventive-utilization. In other words, they compared the rates at which preventive dental care was accessed by workers, between different companies.
Over the six-year period, the high-preventive-utilization group spent 39 percent more on preventive care, but 86 percent less on major and restorative dental services. This translated into a 16 percent savings on dental care, overall, as compared to the low-preventive-utilization group.
Because more than 90 percent of systemic diseases present oral signs and symptoms, routine preventive dental care also aids in early detection of many serious (non-dental) medical conditions. Therefore, accessing their preventive dental care benefits might also help your employees detect health conditions such as diabetes and heart disease. Routine dental care can even contribute to a healthy pregnancy. So, preventive dental care might also help to reduce overall expenditures on medical care, as well as the cost of sick leave and other workplace issues related to employee health.
How can you urge your employees to utilize their preventive dental benefits? First, it is important for you to thoroughly understand your dental health package. Then, you can more effectively communicate those benefits to workers, and offer incentives to encourage their use.
We’re happy to help you understand your dental health policy, so that you and your employees can reap the full benefits of it. Just give us a call and we will discuss your group plan.
When do you think you’ll retire?
Not too long ago, the most common answer was, “age 65”. That’s because 65 was once the standard age for reaching “full retirement age” according to Social Security, meaning you would access your full benefits at that point. Plus, it was – and still is – the age of Medicare eligibility.
So, a worker could reasonably assume that once he or she reached age 65, they could retire, claim their Social Security benefits, and receive healthcare through Medicare.
These days, Social Security’s full retirement age has risen to 66 for those born in 1943 or later, and to 67 for anyone born in 1960 onward. So, many people are delaying retirement at least another year or two (and sometimes longer if their retirement savings falls short of what they need). This means a lot of you are still working at age 65, when you become eligible for Medicare.
Now, here’s a funny thing: You’re actually required to enroll in Medicare when you turn 65. If you don’t, you will face higher premiums when you eventually do retire. For some people, the wait might make sense, but this definitely creates a bit of a puzzle for you.
If you already have health insurance through your employer, it’s important to understand how Medicare will coordinate with that plan. You need to talk with your employer’s health plan administrator, to find out whether you’re required to enroll in Medicare, if your insurance will change once you enroll, and how much you’re paying for health insurance currently. Remember, since you don’t pay taxes on payroll deductions for health insurance, you need to consider the tax implications of keeping your insurance versus enrolling in Medicare.
Should you enroll in Medicare? For most people, Medicare Part A is premium-free. Your hospital expenses will be covered by your employer health care plan, and Medicare Part A would kick in as a secondary payer. In many cases this is a good idea since you might, for example, have a large deductible.
On the other hand, if your employer provides healthcare through a Health Savings Account, their contributions might stop if you enroll in Medicare. You need to investigate this issue before making a decision.
As for Medicare Part B, or doctor and inpatient coverage, the answer is not so clear. If you already have employer coverage, you might not want to enroll in Part B in order to avoid the premiums you will be charged. Part B provides only a very limited value to most people with employer-provided insurance. But if you’re self employed, or work for a small employer with less than 20 full-time employees, Medicare is likely to be the primary payer. So it might make sense to enroll.
The bottom line: It’s complicated. If you’re still working at age 65, and you’re covered by an employer’s group health insurance plan, you should seek specialized guidance when deciding whether to enroll in Medicare.