Counterintuitive though it may be a downturn in the economy generally signals an upturn in higher education. Otherwise qualified individuals who have lost their jobs over the past year have been looking to higher education as a way to occupy their time productively and give them an edge when searching for a new job. In fact, many two and four year institutions are expanding their class offerings to fit the schedule of part-time students looking to boost their resume. Higher education is, indeed, the answer for many Americans who have had their hours reduced or eliminated. Of course, renewed education can be an expensive endeavor, but the digital age has given us a few tools to make higher education more affordable.
Many universities are now taking advantage of online technology to allow users to access lectures and course materials online for free. For instance, many schools are taking advantage of a program called iTunesU. iTunesU allows universities to post audio and video clips of their lectures in the iTunes store where users can download them to their iPod for free. This is a good option for individuals who do not posses the time or the resources to actually attend classes at a university. This also allows you to tailor your learning to your specific career field. This method does not, however, give you any credit that would be visible on a resume; it is simply a way of bringing your education up-to-date in your field.
Some two-year colleges and universities are offering course materials online for free as well. Visiting departmental websites for universities such as UNC Chapel Hill will yield a surprising amount of course work for some classes. You can use study guides and lecture notes to educate yourself on new techniques and theories in your field. Unfortunately this also does not provide a tangible benefit for your resume. Do not be fooled though, increased knowledge in your field will be evident to employers during an interview.
Perhaps the most effective way to redefine your career skills during a downturn is to attend a two-year institution. There are over 1900 community colleges in the United States and many of them are making special efforts to accommodate laid-off employees and part-time employees from local industries. For instance, some community colleges are offering classes that begin as early as 6 a.m. and as late as midnight to accommodate working individuals or individuals with families.
For more information on programs available here in our area you can check out Cape Fear Community College (http://cfcc.edu) or the University of North Carolina Wilmington (http://uncw.edu).
Source
http://money.cnn.com/2009/10/29/pf/online_classes.moneymag/?postversion=2009102904
http://www.nytimes.com/2009/10/28/education/28community.html?_r=1&pagewanted=p
Thursday, October 29, 2009
An Individual Mandate for Healthcare Coverage
Analysts, industry experts, insurance companies, congressional Democrats, and the Obama administration all feel that the only way to make healthcare reform a viable option is to include an individual coverage mandate. This means that Americans who do not have or are not offered health insurance through their employer will be forced to purchase individual coverage or face a penalty levied by the IRS. Unfortunately this is true, the type of healthcare reform that is currently making its way through our legislature would depend on convincing uninsured individuals that they needed health insurance despite the cost. While the government subsidies will easily convince the segment of the uninsured that currently cannot afford health insurance, it is the millions of Americans who already qualify for government subsidized healthcare (Medicaid) and choose not to participate or those that can afford insurance but choose not to purchase it that will take some convincing. The only way to convince these latter individuals is to impose a financial penalty on them for choosing not to participate.
The insurance industry has also clamored for the inclusion of an individual mandate because, they argue, if healthcare reform requires carriers to cover individuals despite pre-existing conditions then it will encourage individuals to go without coverage until they need it and then buy it. This practice goes against the very basis of health insurance which requires premiums from healthy individuals to help offset the costs of unhealthy individuals. The only way to lower health insurance costs while in-turn guaranteeing coverage for every American is to mix risk in the overall insurance pool. Unfortunately this means that healthy Americans who choose to go without health insurance will be forced to participate in the pool for the benefit of the unhealthy. While congressional Democrats and the Obama administration have gone to great lengths to convince voters that this mandate and accompanying penalty is not a tax, it is, by the very definition of the word, a tax.
Despite shifting phrases from the administration, you can bet that any healthcare reform bill that passes this year will include an individual mandate. It will not affect those of us who already have coverage, but it will affect anyone who chooses to go without coverage for any period of time. The only interests that stand to gain from an individual mandate are politicians and insurance companies. The more Americans that politicians can force onto healthcare, the better their statistics will be come next election cycle. And an individual mandate represents potential windfall profits for insurance companies. For those of us that it actually affects, the taxpayers, its just one more burden.
Source
http://www.msnbc.msn.com/id/31782553/ns/health-health_care/
http://www.washingtonpost.com/wp-dyn/content/article/2009/07/21/AR2009072103410.html
http://www.aishealth.com/Bnow/hbd102209.html
The insurance industry has also clamored for the inclusion of an individual mandate because, they argue, if healthcare reform requires carriers to cover individuals despite pre-existing conditions then it will encourage individuals to go without coverage until they need it and then buy it. This practice goes against the very basis of health insurance which requires premiums from healthy individuals to help offset the costs of unhealthy individuals. The only way to lower health insurance costs while in-turn guaranteeing coverage for every American is to mix risk in the overall insurance pool. Unfortunately this means that healthy Americans who choose to go without health insurance will be forced to participate in the pool for the benefit of the unhealthy. While congressional Democrats and the Obama administration have gone to great lengths to convince voters that this mandate and accompanying penalty is not a tax, it is, by the very definition of the word, a tax.
Despite shifting phrases from the administration, you can bet that any healthcare reform bill that passes this year will include an individual mandate. It will not affect those of us who already have coverage, but it will affect anyone who chooses to go without coverage for any period of time. The only interests that stand to gain from an individual mandate are politicians and insurance companies. The more Americans that politicians can force onto healthcare, the better their statistics will be come next election cycle. And an individual mandate represents potential windfall profits for insurance companies. For those of us that it actually affects, the taxpayers, its just one more burden.
Source
http://www.msnbc.msn.com/id/31782553/ns/health-health_care/
http://www.washingtonpost.com/wp-dyn/content/article/2009/07/21/AR2009072103410.html
http://www.aishealth.com/Bnow/hbd102209.html
Friday, October 23, 2009
Issues at Stake for Small Businesses
Over the last few months we have heard a lot of rumors about the affect that healthcare reform might have on small businesses. Some claim that the proposed legislation will have no effect on small groups, while others claim is will make it easier for small groups to afford coverage, while yet others claim that it will force small businesses to provide coverage that they cannot afford. The truth probably lies somewhere in between, but until the actual text of the bill is laid out we will have no way of knowing who is right. Unfortunately all that the Senate committees are releasing are gilded summaries of what is supposedly in the draft legislation rather than the actual wording.
Many experts contend that people may lose their employer sponsored coverage if a play-or-pay mandate system was enacted. The argument being that if given the choice between sponsoring expensive healthcare and paying a fine, many companies will just choose the fine. The truth of the matter is that while companies that do not currently offer benefits may choose to pay the fine rather than take on coverage, most groups that currently have coverage will see no reason to get rid of it just to pay an fine, whether it is less than the cost of a policy or not.
The real area that may come in to play for small business owners is the proposed tax on what lawmakers are calling “cadillac” health care plans. Basically, this means that if your plan has a richer schedule of benefits than the proposed national standard, you may pay a penalty tax. Until the actually wording of the bill is released we will not know what constitutes a cadillac plan and depending on the wording of the bill it is impossible to know how many small businesses will be affected by this penalty. Senate Democrats have marked up the section concerning the taxing of cadillac plans to allow employees in high risk fields such as mining to be exempt after heavy pressure from labor unions and lobbyist. Small business owner really do not have a powerful lobby to support them in Congress, so it is unlikely that they will be making exceptions for any small businesses.
Hopefully in the next few weeks the final wording of the bill will be presented, but by then it may be too late for any change.
Source
http://www.bloomberg.com/apps/news?pid=20670001&sid=ajWDP_UCYBoo
http://boss.blogs.nytimes.com/2009/09/30/will-health-care-reform-encourage-small-business-to-drop-health-coverage?htm
Many experts contend that people may lose their employer sponsored coverage if a play-or-pay mandate system was enacted. The argument being that if given the choice between sponsoring expensive healthcare and paying a fine, many companies will just choose the fine. The truth of the matter is that while companies that do not currently offer benefits may choose to pay the fine rather than take on coverage, most groups that currently have coverage will see no reason to get rid of it just to pay an fine, whether it is less than the cost of a policy or not.
The real area that may come in to play for small business owners is the proposed tax on what lawmakers are calling “cadillac” health care plans. Basically, this means that if your plan has a richer schedule of benefits than the proposed national standard, you may pay a penalty tax. Until the actually wording of the bill is released we will not know what constitutes a cadillac plan and depending on the wording of the bill it is impossible to know how many small businesses will be affected by this penalty. Senate Democrats have marked up the section concerning the taxing of cadillac plans to allow employees in high risk fields such as mining to be exempt after heavy pressure from labor unions and lobbyist. Small business owner really do not have a powerful lobby to support them in Congress, so it is unlikely that they will be making exceptions for any small businesses.
Hopefully in the next few weeks the final wording of the bill will be presented, but by then it may be too late for any change.
Source
http://www.bloomberg.com/apps/news?pid=20670001&sid=ajWDP_UCYBoo
http://boss.blogs.nytimes.com/2009/09/30/will-health-care-reform-encourage-small-business-to-drop-health-coverage?htm
Saving Effectively for Life's Little Expenses
Undoubtedly, we have all been there at one time or another. You have been putting a little money in your retirement account, you are utilizing your health savings account, and you did not even owe any taxes but seemingly out of the blue those yearly expenses start to pop up. Home insurance, car insurance, vehicle registration renewal, annual income taxes, holiday gifts and now you are charging on your credit card or nabbing cash out of your emergency account. Its not that you did not know they were coming, but expenses that occur annually rather than monthly are easy to forget even if you are religious about your budget. Fortunately, there is an effective way to budget for these expenses and keep them from becoming an issue each year.
When you pay a bill monthly it is difficult to forget to budget for it, but when you pay annually its easy for these expenses to fly under the radar. The easiest way to keep these expenses out in front is to devise a system where you pay the bill monthly. By setting aside money each month for annual expenses you can ensure that when the due date comes around you will have the cash to make the payment without having to put it on your credit card or dip into your savings. One way to go about this is to set up a savings account for each large annual expense that you incur and divide the total amounts by twelve months. Each month, deposit the necessary funds into each account and when the bill comes due, pay it from the account and begin saving for next year. This way those large annual sums will be much easier to swallow. For instance, let’s say that you have a $300 life insurance premium due every October. If you set up a separate savings account (or checking account if you prefer) and deposit $25 a month into the account, by next October you’ll have the $300 sum and you will not have to dip into your other savings to pay the bill. There is no doubt that it is much easier to come up with $25 a month than $300 all at once and this way you will never be caught unprepared for an annual expense.
An easy way to set up multiple savings accounts for annual expenses is through an online bank such as ING Direct. Also, many traditional banks offer free checking accounts with no minimum balance and no maintenance fees that you can link to your current online banking. Contact your local bank and tell them what you are looking for and chances are they will be able to point you in the right direction.
A few examples of common annual expenses:
• Home Insurance Premiums
• Life Insurance Premiums
• Car Insurance Premiums
• Vehicle Taxes
• Property Taxes
• Annual Income Taxes
• Holiday, Birthday, and Anniversary Gifts
• Vehicle Maintenance
While none of these expenses are life-altering, they can catch up to you and its best to budget for them now rather than later.
Source
http://www.kiplinger.com/printstory.php?pid=16267
http://qvisory.org/posts/dealing-with-annual-expenses
When you pay a bill monthly it is difficult to forget to budget for it, but when you pay annually its easy for these expenses to fly under the radar. The easiest way to keep these expenses out in front is to devise a system where you pay the bill monthly. By setting aside money each month for annual expenses you can ensure that when the due date comes around you will have the cash to make the payment without having to put it on your credit card or dip into your savings. One way to go about this is to set up a savings account for each large annual expense that you incur and divide the total amounts by twelve months. Each month, deposit the necessary funds into each account and when the bill comes due, pay it from the account and begin saving for next year. This way those large annual sums will be much easier to swallow. For instance, let’s say that you have a $300 life insurance premium due every October. If you set up a separate savings account (or checking account if you prefer) and deposit $25 a month into the account, by next October you’ll have the $300 sum and you will not have to dip into your other savings to pay the bill. There is no doubt that it is much easier to come up with $25 a month than $300 all at once and this way you will never be caught unprepared for an annual expense.
An easy way to set up multiple savings accounts for annual expenses is through an online bank such as ING Direct. Also, many traditional banks offer free checking accounts with no minimum balance and no maintenance fees that you can link to your current online banking. Contact your local bank and tell them what you are looking for and chances are they will be able to point you in the right direction.
A few examples of common annual expenses:
• Home Insurance Premiums
• Life Insurance Premiums
• Car Insurance Premiums
• Vehicle Taxes
• Property Taxes
• Annual Income Taxes
• Holiday, Birthday, and Anniversary Gifts
• Vehicle Maintenance
While none of these expenses are life-altering, they can catch up to you and its best to budget for them now rather than later.
Source
http://www.kiplinger.com/printstory.php?pid=16267
http://qvisory.org/posts/dealing-with-annual-expenses
Thursday, October 1, 2009
The Politics of Healthcare Reform
In early June of this year Senators Chris Dodd (D-CT) and Edward Kennedy (D-MA) introduced a sweeping piece of legislation with the aim of reforming our current health care system. The “Affordable Health Choices Act” totals more than 615 pages and makes an attempt to bring the nearly 40 million uninsured Americans an affordable way to obtain health insurance. As the bill has passed through the various Senate committee’s it has grown in both length and scope. The most recent iteration, Senator Max Baucus’s proposal, seems to be the plan that the Obama administration wants to push forward into law.
Unfortunately, that’s where the clarity ends. For the past three months liberal Democrats have battled it out with moderate Democrats and Republicans over the airwaves and thousands of ordinary Americans have attended various town hall meetings to voice their concern over the proposed bill. All summer, speculation has driven wild rumors of death panels and single-payer systems but little has actually come out about what the final bill will contain.
The only obvious aspect of this debate is the disconnect between Congress and the American people. The most recent poll numbers show a growing majority of Americans disapprove of the proposed healthcare reform and an even larger majority of Americans are opposed to the installation of a public insurance option. On September 28th, Rasmussen Reports’ polling showed that 41% of Americans favor the proposed healthcare reform and 56% percent oppose it. These numbers not only reflect the American people’s frustration with the current administration’s healthcare reform proposal, but growing frustration with a string of government actions. Declining approval ratings for both the administration and Congress support the growing opinion that Americans are disillusioned with the aggressive spending of the last several months. Most Americans are smart enough to know that we are in the process of writing a check that will be awfully painful to cash down the road.
In the end, this issue will be decided in Congress, as it is in most American homes, on party lines. Most Liberal Democrats support the President and the healthcare reform proposal. Moderate Democrats and nearly all Republicans oppose the bill. And while most Americans fall into the latter category, we managed to vote a liberal Congress and President into office with enough votes to do as the see fit regardless of public opinion. Reports over the last month have noted that the administration is prepared to move forward with healthcare reform without any support from the Republican Party, which it seems they are unlikely to receive.
In the end, passing the bill will come with a price tag. In many of the upcoming senate and gubernatorial races early poling shows that Republican candidates are winning more support. The truth is that any Republican Party opposition will be weak over the next few years while the party searches for a message that the American people will trust, but they can certainly take advantage of the backlash of opinion against the Obama administration and Congress’s liberal spending tactics.
Source
http://www.businessinsurance.com/article/20090609/NEWS/906099972
http://www.nytimes.com/2009/09/05/health/policy/05health.html?bl&ex=1252296000&en=aca08736a6e52505&ei=5087%0A
http://prescriptions.blogs.nytimes.com/2009/09/09/baucus-to-press-ahead-with-senate-proposal/
http://money.cnn.com/2009/09/10/news/economy/healthcare_defensive_medicine/?postversion=2009091010
http://www.rasmussenreports.com/public_content/politics/current_events/healthcare/september_2009/health_care_reform
Unfortunately, that’s where the clarity ends. For the past three months liberal Democrats have battled it out with moderate Democrats and Republicans over the airwaves and thousands of ordinary Americans have attended various town hall meetings to voice their concern over the proposed bill. All summer, speculation has driven wild rumors of death panels and single-payer systems but little has actually come out about what the final bill will contain.
The only obvious aspect of this debate is the disconnect between Congress and the American people. The most recent poll numbers show a growing majority of Americans disapprove of the proposed healthcare reform and an even larger majority of Americans are opposed to the installation of a public insurance option. On September 28th, Rasmussen Reports’ polling showed that 41% of Americans favor the proposed healthcare reform and 56% percent oppose it. These numbers not only reflect the American people’s frustration with the current administration’s healthcare reform proposal, but growing frustration with a string of government actions. Declining approval ratings for both the administration and Congress support the growing opinion that Americans are disillusioned with the aggressive spending of the last several months. Most Americans are smart enough to know that we are in the process of writing a check that will be awfully painful to cash down the road.
In the end, this issue will be decided in Congress, as it is in most American homes, on party lines. Most Liberal Democrats support the President and the healthcare reform proposal. Moderate Democrats and nearly all Republicans oppose the bill. And while most Americans fall into the latter category, we managed to vote a liberal Congress and President into office with enough votes to do as the see fit regardless of public opinion. Reports over the last month have noted that the administration is prepared to move forward with healthcare reform without any support from the Republican Party, which it seems they are unlikely to receive.
In the end, passing the bill will come with a price tag. In many of the upcoming senate and gubernatorial races early poling shows that Republican candidates are winning more support. The truth is that any Republican Party opposition will be weak over the next few years while the party searches for a message that the American people will trust, but they can certainly take advantage of the backlash of opinion against the Obama administration and Congress’s liberal spending tactics.
Source
http://www.businessinsurance.com/article/20090609/NEWS/906099972
http://www.nytimes.com/2009/09/05/health/policy/05health.html?bl&ex=1252296000&en=aca08736a6e52505&ei=5087%0A
http://prescriptions.blogs.nytimes.com/2009/09/09/baucus-to-press-ahead-with-senate-proposal/
http://money.cnn.com/2009/09/10/news/economy/healthcare_defensive_medicine/?postversion=2009091010
http://www.rasmussenreports.com/public_content/politics/current_events/healthcare/september_2009/health_care_reform
Thursday, May 28, 2009
Don't Let Healthcare Bust Your Budget
The recent financial troubles have been especially hard on small business owners and employees. As such, it has become especially important that you take full advantage of all the benefits that your coverage has to offer.
If you have a high deductible health plan coupled with a health savings account, there are a few things that you need to keep a close eye on. Having a health savings account style plan is a great way to save on insurance premiums and have your other health costs tax deducted, but you also have to pay careful attention what you are spending on health insurance unlike co-pay plan users.
First of all, make sure that you are searching for the best deal on your healthcare. With a high deductible health plan, you still only pay your carrier’s negotiated price, but their negotiated price is not necessarily the same at every physician’s office for the same services. Make sure that whenever possible you use your primary care provider rather than an urgent care facility or the emergency room. Emergency room visits tend to cost between $300 and $1000, urgent care visits around $150, and primary care visits between $30 and $50. These are significant savings. Another trick to minimizing your costs is to get your doctor to prescribe you only generics when possible.
Also, make sure that you present your insurance card when you visit the doctor or the pharmacy even if you have yet to meet your deductible. First of all, this will make sure that any expenses you incur will be applied towards you deductible. Second of all, presenting your card will ensure that you only pay your carrier’s negotiated rate.
Be sure to visit the IRS’s website and find their list of qualified expenses for Health Savings Account users so that you can take full advantage of your tax savings. Expenses such as dental care and over the counter drugs are eligible expenses. It pays to know.
Source
http://www.kiplinger.com/columns/ask/archive/2009/q0129.htm
http://www.kiplinger.com/magazine/archives/2007/05/insurance.html
If you have a high deductible health plan coupled with a health savings account, there are a few things that you need to keep a close eye on. Having a health savings account style plan is a great way to save on insurance premiums and have your other health costs tax deducted, but you also have to pay careful attention what you are spending on health insurance unlike co-pay plan users.
First of all, make sure that you are searching for the best deal on your healthcare. With a high deductible health plan, you still only pay your carrier’s negotiated price, but their negotiated price is not necessarily the same at every physician’s office for the same services. Make sure that whenever possible you use your primary care provider rather than an urgent care facility or the emergency room. Emergency room visits tend to cost between $300 and $1000, urgent care visits around $150, and primary care visits between $30 and $50. These are significant savings. Another trick to minimizing your costs is to get your doctor to prescribe you only generics when possible.
Also, make sure that you present your insurance card when you visit the doctor or the pharmacy even if you have yet to meet your deductible. First of all, this will make sure that any expenses you incur will be applied towards you deductible. Second of all, presenting your card will ensure that you only pay your carrier’s negotiated rate.
Be sure to visit the IRS’s website and find their list of qualified expenses for Health Savings Account users so that you can take full advantage of your tax savings. Expenses such as dental care and over the counter drugs are eligible expenses. It pays to know.
Source
http://www.kiplinger.com/columns/ask/archive/2009/q0129.htm
http://www.kiplinger.com/magazine/archives/2007/05/insurance.html
New COBRA Rules: Explained
The new stimulus law recently passed by congress provides a COBRA premium subsidy to assist recently terminated employees with the cost of their health insurance. The subsidy will cover 65% of the participant’s bill for up to nine months.
The new subsidy only applies to employees who lost or lose their job between September 1, 2008 and January 1, 2010. The law creating the subsidy requires that employers to notify all of their current COBRA participants of the new law. This notification can be handled through the group administrator or through a company’s COBRA benefits administrator such as Ceridian. Once the employees have been notified of the change they will have sixty days to notify their former employer of their decision to take coverage.
Only employees who lost their coverage due to involuntary termination are eligible for the COBRA premium subsidy. If you have employees who came off the group plan after September 1, 2008 they only apply to employees that were laid off involuntarily. If you had an employee leave your group plan due to voluntary termination, retirement, or a reduction in hours, they are not eligible for the COBRA premium subsidy. They are however, still eligible for regular COBRA coverage.
Employees who lost their coverage after September 1, 2008, but did not elect to take coverage at that time will have a second opportunity to elect coverage following the COBRA subsidy notice. COBRA coverage will still only be good for up to eighteen months from the date of their original qualifying event; their date of termination. The subsidy is good for up to and including nine months. After the nine months is up, the participants COBRA costs will return to the original cost. The participant will still be able to terminate their COBRA coverage anytime with-in the eighteen months that they are eligible for coverage. Once the participant reaches the eighteen month deadline, regardless of whether or not their nine month subsidy eligibility is up, they will no longer be able to be a COBRA participant on their former employer’s group coverage, meaning that they will have to find other coverage without the use of the stimulus subsidy.
Billing for subsidy participants will be much like normal COBRA billing except that the participant will only pay 35% of their total cost. The employer will cover the extra 65% of the cost. Once the bill has been paid the employer will deduct that 65%, plus any other COBRA subsidy participants’ 65% from wage withholding for their Federal Insurance Contributions Act (FICA) Payroll Tax. For instance, if your FICA taxes totaled $10,000 for a given period and the premium subsidies totaled $5000, your total tax load due to the government would be $5000. If your FICA taxes totaled to $5000 for a given period and the premium subsidies totaled $6000, the government would reimburse you that $1000 difference.
For the employer to claim these reimbursements from the IRS, they will be required to keep detailed supporting records for each COBRA subsidy participant. Your COBRA billing administrator (Ceridian) will keep track of which premiums have been received from participants as well as requiring individuals to certify their eligibility. Your administrator will then send you a monthly report detailing this information which you will be required to save as supporting record for your reimbursements from the government.
This is by no means a complete run-down of the changes made to the COBRA Omnibus under the American Recovery and Reinvestment Act, but these highlights should help you gain a better understanding of what these changes mean for you and your business. If you have any questions at all, please do not hesitate to call us and we will do our best to assist you.
Source
Ceridian
http://www.kiplinger.com/columns/ask/archive/2009/q0223.htm
The new subsidy only applies to employees who lost or lose their job between September 1, 2008 and January 1, 2010. The law creating the subsidy requires that employers to notify all of their current COBRA participants of the new law. This notification can be handled through the group administrator or through a company’s COBRA benefits administrator such as Ceridian. Once the employees have been notified of the change they will have sixty days to notify their former employer of their decision to take coverage.
Only employees who lost their coverage due to involuntary termination are eligible for the COBRA premium subsidy. If you have employees who came off the group plan after September 1, 2008 they only apply to employees that were laid off involuntarily. If you had an employee leave your group plan due to voluntary termination, retirement, or a reduction in hours, they are not eligible for the COBRA premium subsidy. They are however, still eligible for regular COBRA coverage.
Employees who lost their coverage after September 1, 2008, but did not elect to take coverage at that time will have a second opportunity to elect coverage following the COBRA subsidy notice. COBRA coverage will still only be good for up to eighteen months from the date of their original qualifying event; their date of termination. The subsidy is good for up to and including nine months. After the nine months is up, the participants COBRA costs will return to the original cost. The participant will still be able to terminate their COBRA coverage anytime with-in the eighteen months that they are eligible for coverage. Once the participant reaches the eighteen month deadline, regardless of whether or not their nine month subsidy eligibility is up, they will no longer be able to be a COBRA participant on their former employer’s group coverage, meaning that they will have to find other coverage without the use of the stimulus subsidy.
Billing for subsidy participants will be much like normal COBRA billing except that the participant will only pay 35% of their total cost. The employer will cover the extra 65% of the cost. Once the bill has been paid the employer will deduct that 65%, plus any other COBRA subsidy participants’ 65% from wage withholding for their Federal Insurance Contributions Act (FICA) Payroll Tax. For instance, if your FICA taxes totaled $10,000 for a given period and the premium subsidies totaled $5000, your total tax load due to the government would be $5000. If your FICA taxes totaled to $5000 for a given period and the premium subsidies totaled $6000, the government would reimburse you that $1000 difference.
For the employer to claim these reimbursements from the IRS, they will be required to keep detailed supporting records for each COBRA subsidy participant. Your COBRA billing administrator (Ceridian) will keep track of which premiums have been received from participants as well as requiring individuals to certify their eligibility. Your administrator will then send you a monthly report detailing this information which you will be required to save as supporting record for your reimbursements from the government.
This is by no means a complete run-down of the changes made to the COBRA Omnibus under the American Recovery and Reinvestment Act, but these highlights should help you gain a better understanding of what these changes mean for you and your business. If you have any questions at all, please do not hesitate to call us and we will do our best to assist you.
Source
Ceridian
http://www.kiplinger.com/columns/ask/archive/2009/q0223.htm
Our New Website
We are very proud to announce that earlier this year we released our first website, http://www.quotepinnacle.com, dedicated to providing our clients with all the information they need to make the best decision when it comes to their insurance needs. We wanted to take a few minutes to highlight the features that you may find useful, or at least we hope you will!
On our Business Resources page you will find all the information that you need to assist you in handling new enrollments and terminations along with tips for dealing with COBRA or state continuation and contact numbers for carriers. You will also find an updated list of forms from our carriers.
Our Health and Wellness page is dedicated to improving the overall health and wellbeing of our customers. On this page you will find information about our in-house Small Business Wellness Program as well as resources for the healthy individual.
The Health Savings Account Resource are of our website is dedicated to consumer driven health insurance. We believe in the validity of high deductible health plans and their accompanying health savings accounts, especially for our younger clientele. On this page you will find all the information you ever wanted to know about these types of plans as well as why we think they are right for so many individuals and why they are so often overlooked.
Finally, our Group and Individual Coverage pages are dedicated to the products we have available for our clients and our potential clients. On these pages you can view the carriers we work with along with all the different types of products we offer. You can also request a quote directly from our site!
On our Business Resources page you will find all the information that you need to assist you in handling new enrollments and terminations along with tips for dealing with COBRA or state continuation and contact numbers for carriers. You will also find an updated list of forms from our carriers.
Our Health and Wellness page is dedicated to improving the overall health and wellbeing of our customers. On this page you will find information about our in-house Small Business Wellness Program as well as resources for the healthy individual.
The Health Savings Account Resource are of our website is dedicated to consumer driven health insurance. We believe in the validity of high deductible health plans and their accompanying health savings accounts, especially for our younger clientele. On this page you will find all the information you ever wanted to know about these types of plans as well as why we think they are right for so many individuals and why they are so often overlooked.
Finally, our Group and Individual Coverage pages are dedicated to the products we have available for our clients and our potential clients. On these pages you can view the carriers we work with along with all the different types of products we offer. You can also request a quote directly from our site!
New Happenings at Pinnacle Benefits Group
Over the last few months we have made a lot of changes here at Pinnacle Benefits Group in an effort to increase our utility to our clients and other individuals and small business owners. We are focusing on ways to try and improve our business without sacrificing our current level of service.
The first and largest change we are making is the addition of property and liability insurance products to our current line of products. Effective the first of this year we are offering commercial general liability and worker’s compensation insurance along with a full line of personal home, auto, and marine insurance. Just like our other products, we work with most of the top carriers in North Carolina to bring you a comprehensive look at what the market has to offer.
We are also proud to announce that our new website is up and running and you can check it out at http://www.quotepinnacle.com. For a full look at the features on our website, take a look at the Our New Website article in this issue of our Quarterly Newsletter.
Last, but not least, we will be unveiling our new logo and company letterhead in the next few weeks. We feel that our new logo will reflect our distinctness in our market. We are not like the majority of insurance agencies that have yet to see the changing tides in the Insurance industry. As we’ve featured in our earlier newsletters, something has to give in the health care market in the near future. Americans are becoming less and less healthy while healthcare costs and insurance premiums are shooting through the roof. Our current status cannot be maintained for much longer. That’s why in the last few years we have tried to focus more on consumer driven health products like high deductible health plans coupled with health savings accounts. In addition, we are developing plans for our clients that advocate healthier lifestyles. Healthcare is always going to be expensive, but statistically the healthier you are the less likely you are to need it.
All of these changes have one goal in mind; giving you all the tools you need to make the best decisions for you and your family when it comes to your insurance needs.
The first and largest change we are making is the addition of property and liability insurance products to our current line of products. Effective the first of this year we are offering commercial general liability and worker’s compensation insurance along with a full line of personal home, auto, and marine insurance. Just like our other products, we work with most of the top carriers in North Carolina to bring you a comprehensive look at what the market has to offer.
We are also proud to announce that our new website is up and running and you can check it out at http://www.quotepinnacle.com. For a full look at the features on our website, take a look at the Our New Website article in this issue of our Quarterly Newsletter.
Last, but not least, we will be unveiling our new logo and company letterhead in the next few weeks. We feel that our new logo will reflect our distinctness in our market. We are not like the majority of insurance agencies that have yet to see the changing tides in the Insurance industry. As we’ve featured in our earlier newsletters, something has to give in the health care market in the near future. Americans are becoming less and less healthy while healthcare costs and insurance premiums are shooting through the roof. Our current status cannot be maintained for much longer. That’s why in the last few years we have tried to focus more on consumer driven health products like high deductible health plans coupled with health savings accounts. In addition, we are developing plans for our clients that advocate healthier lifestyles. Healthcare is always going to be expensive, but statistically the healthier you are the less likely you are to need it.
All of these changes have one goal in mind; giving you all the tools you need to make the best decisions for you and your family when it comes to your insurance needs.
Why You Need a Roth IRA
“With this indispensable savings tool, your money grows tax-free, you can invest in almost anything, and you get several cool perks.”
-The Kiplinger Report
A Roth IRA very well may be the most versatile investment tool available for young adults. While the relatively low income limits on a Roth IRA mean that you won’t be able to use them forever, the flexibility they offer make them the perfect tool to begin your investment career.
First, let’s go over the rules for utilizing a Roth IRA. Only earned income is eligible for deposit in a Roth IRA, meaning that any money not earned through a paying job cannot be deposited into a Roth IRA. Single filers making less than $105,000 per year and joint filers making less than $166,000 per year can contribute up to $5,000 per year into a Roth IRA. If you are single and you make more than $105,000 per year or if you file jointly and have a combined income of more than $166,000 then your contribution will be limited. At an income level of $120,000 for singles and $176,000 for couples, you can no longer contribute to a Roth IRA. If you already have a Roth and reach those limits, you do not have to cash the account out; you simply cannot contribute to the account any longer.
Roth IRA’s offer enormous tax advantages as well. Any funds deposited into a Roth IRA are completely tax free if you wait until retirement to remove the money. If you do remove your money before retirement, you can withdraw any contributions tax free without penalty. However, if you withdraw any of the earnings from the account before retirement, they will be subject to taxing as well as a 10% early withdrawal fee. In addition to the tax advantages of a Roth IRA, account holders can use their contributions for things like purchasing their first home or saving for their children’s college tuition tax free. In addition, the Roth IRA will function as an emergency fund in a pinch since contributions can be withdrawn tax free at any time as long as any earnings on the account are left in.
Beginning in 2008, the IRS will allow Roth account holders to withdraw up to $10,000 including earnings, tax and penalty free, for the purchase of a first home. To qualify for this tax break, the account must be open for at least five years, meaning if you open an account for 2009, you could use your contributions and earnings towards the purchase of your first home as early as January 2014. The $10,000 limit is per person, so a couple could withdraw up to $20,000.
You can also use a Roth IRA to save for your children’s college if your income level does not allow for contributions to both a retirement fund and a college savings fund. In addition to being able to withdraw contributions at any time tax and penalty free, you can withdraw your earnings penalty free if you use the money for college tuition. You’ll still have to pay taxes on any earnings you use for college tuition, but you can avoid the 10% early-withdrawal penalty.
Any way you cut it, a Roth IRA is an incredibly versatile savings and investment tool. From saving for college to buying your first house, a Roth IRA will allow you to save your money, tax free, while still having access to your contributions at any time, penalty free.
Source
http://www.kiplinger.com/columns/starting/archive/2006/st0309.htm
http://www.irs.gov
-The Kiplinger Report
A Roth IRA very well may be the most versatile investment tool available for young adults. While the relatively low income limits on a Roth IRA mean that you won’t be able to use them forever, the flexibility they offer make them the perfect tool to begin your investment career.
First, let’s go over the rules for utilizing a Roth IRA. Only earned income is eligible for deposit in a Roth IRA, meaning that any money not earned through a paying job cannot be deposited into a Roth IRA. Single filers making less than $105,000 per year and joint filers making less than $166,000 per year can contribute up to $5,000 per year into a Roth IRA. If you are single and you make more than $105,000 per year or if you file jointly and have a combined income of more than $166,000 then your contribution will be limited. At an income level of $120,000 for singles and $176,000 for couples, you can no longer contribute to a Roth IRA. If you already have a Roth and reach those limits, you do not have to cash the account out; you simply cannot contribute to the account any longer.
Roth IRA’s offer enormous tax advantages as well. Any funds deposited into a Roth IRA are completely tax free if you wait until retirement to remove the money. If you do remove your money before retirement, you can withdraw any contributions tax free without penalty. However, if you withdraw any of the earnings from the account before retirement, they will be subject to taxing as well as a 10% early withdrawal fee. In addition to the tax advantages of a Roth IRA, account holders can use their contributions for things like purchasing their first home or saving for their children’s college tuition tax free. In addition, the Roth IRA will function as an emergency fund in a pinch since contributions can be withdrawn tax free at any time as long as any earnings on the account are left in.
Beginning in 2008, the IRS will allow Roth account holders to withdraw up to $10,000 including earnings, tax and penalty free, for the purchase of a first home. To qualify for this tax break, the account must be open for at least five years, meaning if you open an account for 2009, you could use your contributions and earnings towards the purchase of your first home as early as January 2014. The $10,000 limit is per person, so a couple could withdraw up to $20,000.
You can also use a Roth IRA to save for your children’s college if your income level does not allow for contributions to both a retirement fund and a college savings fund. In addition to being able to withdraw contributions at any time tax and penalty free, you can withdraw your earnings penalty free if you use the money for college tuition. You’ll still have to pay taxes on any earnings you use for college tuition, but you can avoid the 10% early-withdrawal penalty.
Any way you cut it, a Roth IRA is an incredibly versatile savings and investment tool. From saving for college to buying your first house, a Roth IRA will allow you to save your money, tax free, while still having access to your contributions at any time, penalty free.
Source
http://www.kiplinger.com/columns/starting/archive/2006/st0309.htm
http://www.irs.gov
Tuesday, April 7, 2009
President Obama Proposes New Health Care Reform
At a recent summit on health care reform, President Obama told a group of doctors, lawyers, and lawmakers that “one of the greatest threats, not just to the well-being of our families…but to the very foundation of our economy.” He said, “We cannot delay this discussion any longer, health care reform is no longer just a moral imperative, it is a fiscal imperative. If we want to create jobs, rebuild our economy, and get our federal budget under control, then we must address the crushing cost of health care this year.”
Many expected for President Obama to address health care reform during his first term, but few expected for him to call for a plan by the close of his first year in office. During his presidential campaign, Obama promised to achieve universal health care and to cut the average family’s health care costs by $2500 by the end of his first term. So what does President Obama propose to lift the “crushing” burden of health care costs?
First, health care reform cannot even be considered without finding the money to pay for it. Obama is seeking to set aside $634 billion over the next ten years as a health care reserve fund in an effort to move the country closer towards a goal of universal coverage as well as requiring seniors making over $170,000 per year to pay a higher percentage of their prescription drug costs, effectively reducing the burden on the already overworked Medicare system.
In addition to these measures, recently Obama’s aides have been signaling to Congress that he would support taxing employee health benefits to help pay for the health care system overhaul. During his presidential campaign in 2008, Senator John McCain proposed a similar plan, which Obama denounced as “the largest middle-class tax increase in history.” Faced with the overwhelming cost of reform, and a soaring national debt, Obama has been forced to recant. His change of heart could, however, become trouble politically when it is time for reelection. His victory in 2008 is owed in large part to staunch support from union leaders, whom oppose any such legislation.
Next, President Obama proposes to allow congress to sculpt their own bill, rather than handing them a plan and asking them to pass it; a method which failed miserably in the early nineties when the Clinton’s attempted to pass health care reform. The President does plan to provide congress with a few guidelines however. He laid out his eight principles for health care reform at the recent summit. His guidelines include:
• Guaranteeing choice of health plans and physicians
• Making health coverage affordable
• Protecting families’ financial health
• Investing in prevention and wellness
• Providing portability of coverage
• Aiming for universality
• Improving patient safety and quality care
• Maintaining long-term fiscal sustainability
During his run for office in 2008, Obama proposed a plan that would achieve his goals. The following points outline the plan he campaigned with:
• Require insurance companies to cover pre-existing conditions so that health coverage would be available to all people, regardless of health
• Create a new small business health tax credit that would make it more affordable for small businesses to insure their employees
• Cover a portion of small businesses catastrophic health coverage so that they would in turn offer lower premiums to their employees
• Prevent insurers from overcharging doctors for their malpractice insurance and invest in proven strategies to reduce medical errors
• Make employer contributions more fair by requiring large employers that do not offer health coverage to contribute a percentage of payroll towards the costs of their employee’s health care
• Establish a National Health Insurance Exchange with a range of private insurance options as well as a new public plan based on benefits available to members of Congress that will allow individuals and small businesses to buy affordable health coverage
• Ensure everyone who needs it will receive a tax credit for their premiums
• Lower drug costs by allowing the importation of safe medicines from other developed countries, increasing the use of generic drugs in public programs, and taking on drug companies that block cheaper generic medicines from the market
• Require hospitals to collect and report health care cost and quality data
• Reduce the costs of catastrophic illnesses for employers and their employees
• Reform the insurance market to increase competition by taking on anticompetitive activity that drives up prices without improving quality of care
While many in congress agree with the goals set forth by Obama’s plan, there is multitude of opinions on how to go about achieving those goals. While the opposition is generally partisan, it behooves the American health care consuming public to listen to what they have to say.
Recently, leading Republican Senators sent a letter to President Obama stating “that they would oppose any healthcare bill with a public plan because it would force insurers to compete on an unlevel playing field with the government.” Meanwhile, the President and majority leaders in Congress are arguing that there needs to be a government controlled alternative to private insurance.
The private insurance industry is also trying to position themselves to become a major player in the upcoming round of health care reform. Insurers are telling anyone that will listen that they are in the unique position to help improve quality and reduce waste. While it might not seem to be in their best interest at first glance, cooperating and facilitating reform could be a boon for private insurers. In the past few years, as premiums have steadily increased, individual and employer coverage has dwindled. At the same time government run programs for children and the elderly have grown into vital business for the insurers.
Whether any of these measures will help or whether any reform will take place at all remains to be seen. What we do know is that our current health care system will not remain viable for long. Here at Pinnacle Benefits Group we have made a commitment to do our part in improving the health care system. We have designed and are preparing to release a comprehensive wellness plan for our small business groups. It is our belief that regardless of what ever reform takes place in the next few years, Americans need to focus on improving their overall health to reduce their dependence on the health care system. If we can manage to improve our overall health only by a small fraction which is a simple matter of improving our lifestyles, we could significantly reduce the burden on the healthcare system.
If you have any questions about our Wellness Program for your small business, give us a call!
Source
http://www.nytimes.com/2009/03/15/us/politics/15health.html?_r=1&ref=todayspaper
http://www.google.com/hostednews/ap/article/ALeqM5jUy9FZma7bcviA2UQZ2pDst5tNXwD96UKS080
http://cgi.cnn.com/2009/POLITICS/03/05/health.care.summit/index.html
http://www.cnn.com/2009/HEALTH/03/20/obama.health.care
http://blogs.abcnews.com/politicalpunch/2009/03/president-oba-5.html
http://www.whitehouse.gov/agenda/health_care/
Many expected for President Obama to address health care reform during his first term, but few expected for him to call for a plan by the close of his first year in office. During his presidential campaign, Obama promised to achieve universal health care and to cut the average family’s health care costs by $2500 by the end of his first term. So what does President Obama propose to lift the “crushing” burden of health care costs?
First, health care reform cannot even be considered without finding the money to pay for it. Obama is seeking to set aside $634 billion over the next ten years as a health care reserve fund in an effort to move the country closer towards a goal of universal coverage as well as requiring seniors making over $170,000 per year to pay a higher percentage of their prescription drug costs, effectively reducing the burden on the already overworked Medicare system.
In addition to these measures, recently Obama’s aides have been signaling to Congress that he would support taxing employee health benefits to help pay for the health care system overhaul. During his presidential campaign in 2008, Senator John McCain proposed a similar plan, which Obama denounced as “the largest middle-class tax increase in history.” Faced with the overwhelming cost of reform, and a soaring national debt, Obama has been forced to recant. His change of heart could, however, become trouble politically when it is time for reelection. His victory in 2008 is owed in large part to staunch support from union leaders, whom oppose any such legislation.
Next, President Obama proposes to allow congress to sculpt their own bill, rather than handing them a plan and asking them to pass it; a method which failed miserably in the early nineties when the Clinton’s attempted to pass health care reform. The President does plan to provide congress with a few guidelines however. He laid out his eight principles for health care reform at the recent summit. His guidelines include:
• Guaranteeing choice of health plans and physicians
• Making health coverage affordable
• Protecting families’ financial health
• Investing in prevention and wellness
• Providing portability of coverage
• Aiming for universality
• Improving patient safety and quality care
• Maintaining long-term fiscal sustainability
During his run for office in 2008, Obama proposed a plan that would achieve his goals. The following points outline the plan he campaigned with:
• Require insurance companies to cover pre-existing conditions so that health coverage would be available to all people, regardless of health
• Create a new small business health tax credit that would make it more affordable for small businesses to insure their employees
• Cover a portion of small businesses catastrophic health coverage so that they would in turn offer lower premiums to their employees
• Prevent insurers from overcharging doctors for their malpractice insurance and invest in proven strategies to reduce medical errors
• Make employer contributions more fair by requiring large employers that do not offer health coverage to contribute a percentage of payroll towards the costs of their employee’s health care
• Establish a National Health Insurance Exchange with a range of private insurance options as well as a new public plan based on benefits available to members of Congress that will allow individuals and small businesses to buy affordable health coverage
• Ensure everyone who needs it will receive a tax credit for their premiums
• Lower drug costs by allowing the importation of safe medicines from other developed countries, increasing the use of generic drugs in public programs, and taking on drug companies that block cheaper generic medicines from the market
• Require hospitals to collect and report health care cost and quality data
• Reduce the costs of catastrophic illnesses for employers and their employees
• Reform the insurance market to increase competition by taking on anticompetitive activity that drives up prices without improving quality of care
While many in congress agree with the goals set forth by Obama’s plan, there is multitude of opinions on how to go about achieving those goals. While the opposition is generally partisan, it behooves the American health care consuming public to listen to what they have to say.
Recently, leading Republican Senators sent a letter to President Obama stating “that they would oppose any healthcare bill with a public plan because it would force insurers to compete on an unlevel playing field with the government.” Meanwhile, the President and majority leaders in Congress are arguing that there needs to be a government controlled alternative to private insurance.
The private insurance industry is also trying to position themselves to become a major player in the upcoming round of health care reform. Insurers are telling anyone that will listen that they are in the unique position to help improve quality and reduce waste. While it might not seem to be in their best interest at first glance, cooperating and facilitating reform could be a boon for private insurers. In the past few years, as premiums have steadily increased, individual and employer coverage has dwindled. At the same time government run programs for children and the elderly have grown into vital business for the insurers.
Whether any of these measures will help or whether any reform will take place at all remains to be seen. What we do know is that our current health care system will not remain viable for long. Here at Pinnacle Benefits Group we have made a commitment to do our part in improving the health care system. We have designed and are preparing to release a comprehensive wellness plan for our small business groups. It is our belief that regardless of what ever reform takes place in the next few years, Americans need to focus on improving their overall health to reduce their dependence on the health care system. If we can manage to improve our overall health only by a small fraction which is a simple matter of improving our lifestyles, we could significantly reduce the burden on the healthcare system.
If you have any questions about our Wellness Program for your small business, give us a call!
Source
http://www.nytimes.com/2009/03/15/us/politics/15health.html?_r=1&ref=todayspaper
http://www.google.com/hostednews/ap/article/ALeqM5jUy9FZma7bcviA2UQZ2pDst5tNXwD96UKS080
http://cgi.cnn.com/2009/POLITICS/03/05/health.care.summit/index.html
http://www.cnn.com/2009/HEALTH/03/20/obama.health.care
http://blogs.abcnews.com/politicalpunch/2009/03/president-oba-5.html
http://www.whitehouse.gov/agenda/health_care/
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