Summary:
Aly Adair has previously published this content on the Internet. More Americans are looking at consumer-directed health plans as a way to offset the rising costs of health care, the higher deductibles in medical insurance plans, and high personal income taxes. Consumer-directed health plans can vary from employer to employer, but most plans have some common benefits. There are steps you can take to choose which consumer-directed health plan is best for you and your family.

Details or Sample:
Consumer-directed health plans like Health Savings Accounts (HSAs), Flexible Spending Accounts (FSAs) and Health Reimbursement Accounts (HRAs) are becoming more popular as Americans seek to gain greater control over managing their high healthcare costs. In a study done by AARP, researchers found that consumers can benefit from consumer-directed health plans, but deciding which plan is best and having the skills to manage the plan may be more than some consumers are able to handle.

A BlueCross BlueShield Association press release in early 2007, reports that 57% of HSA-eligible enrollees opened HSA accounts in 2006. According to the same press release, the U.S. Department of Treasury estimates that by 2010, 40 to 45 million Americans will be enrolled in an HSA-eligible insurance plan.

BlueCross BlueShield Association has launched the Blue Healthcare Bank in order to help provide its healthcare insurance customers a one-stop, integrated customer service model with expertise in healthcare-related financial services. The Blue Healthcare Bank will work with BlueCross BlueShield companies to provide debit cards and other financial services tied to HSAs, FSAs, and HRAs.

According to the U.S. Government Accountability Office (GAO), the reason consumer-directed health plans are becoming so popular is because of the rising costs of health care in America. Consumer-directed health plans can provide consumers a convenient, consistent way to pay for eligible medical, dental, and vision services and for expenses associated with high-deductible medical plans.

Debit cards tied to certain consumer-directed health plans can be used in the medical provider’s office to pay for medical services and insurance deductibles. This eliminates the need to wait for health care expense reimbursement by your health insurance provider. For some consumer-directed health plans, you can use the money or the debit card for expenses that are not covered under your health insurance plan BEFORE you make the contributions. Some plans also allow coverage under another health plan and allow you to be reimbursed for healthcare insurance premiums.

Examples of some of the eligible expenses under consumer-directed health plans include:
deductibles and co-pays
dental services
eye exams, eye glasses, contacts, LASIK surgery
hearing exams
drug addiction programs
weight loss programs
medical equipment
prescription drugs
OB/GYN
dermatologist and Allergist
Over-the-counter (OTC) expenses like cold/flu medicines, sleep aids, pain relievers, bandages, condoms, cough drops, reading glasses, nasal sprays, and pregnancy test kits
Over-the-counter expenses like sunscreen, vitamins to treat a medical condition, hormone therapy, arthritis, and orthopedic inserts might be allowed with a doctor’s note

Examples of expenses that are NOT eligible under most consumer-directed health plans include:
deodorant
mouthwash
moisturizers
sleeping pills
multivitamins
toothpaste and toothbrush
weight scales
medicated soap

Brief Description of Various Consumer-Directed Health Plans
(Benefit plans can vary widely. For more details about consumer-directed health plans available to you, check with your employer’s benefit department)

Flexible Spending Account (FSA)
Health Savings Account (HSA)
Health Reimbursement Account (HRA)

Before You Decide on a Consumer-Directed Health Plan

Many factors go into the decision about which consumer-directed health plan is best for you and your family. Your employer’s human resources or benefits department can provide detailed information about what consumer-directed health plans are available to you. You may consider taking the consumer-directed health plan information to a tax advisor or CPA to help determine the tax implications and options for your personal income situation.

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