The Value of Health Savings Accounts (HSA's)

What is a Health Savings Account?

A Health Savings Account (HSA) is like a 401(k) for healthcare. HSAs are tax-advantaged accounts that can accumulate interest and earn investment returns. The funds can be used to pay for qualified medical expenses today or can be saved for future expenses. It is owned by you, is 100% vested from day one, and lets you build up savings for future needs.

Triple tax savings Contributions are not taxable to you, and investment growth is not taxed while it is in the account. Distributions are not taxable as long as they are spent on eligible healthcare expenses incurred after the HSA was established.

Interest and investments Your HSA balance may earn interest each month, and once you meet the minimum balance, you will have the option to invest in nationally recognized mutual fund families.

Annual HSA contribution limits are set by the IRS.

Multiple uses Hundreds of eligible healthcare expenses may be paid for with HSA funds, including prescriptions, over-the-counter medications with a prescription, doctor office co-pays, health insurance deductibles, and coinsurance. Funds may even be used for qualified expenses for your spouse or dependents.

Take it with you Because your HSA is owned by you, even if you change health plans or later become ineligible to make contributions, your account stays with you. You can even use your account for retirement expenses when you reach 65.

Easy to access Funds in the account are easily accessed with the healthcare payment card. Or, you can submit withdrawal requests online when using the card is not convenient.

Catch-Up Contributions Individuals ages 55 or older (and not yet enrolled in Medicare) can make additional “catch-up” contributions of up to $1,000 per person.

Qualified expenses are listed in IRS Publication 502.


HSA Rules & Regulations

• To be eligible to open and contribute to an HSA, you must be covered by a qualified High Deductible Health Plan (HDHP).

• HSA funds may be used for any eligible healthcare expense not covered by insurance or any other plan for yourself, your spouse, or tax dependents.

 • HSA funds can be withdrawn for nonhealthcare items, but will be subject to regular income taxes and a 20% excise tax penalty.

• For 2018, contributions may not exceed $3,450 for individual coverage or $6,900 for family coverage.

• Consult your tax advisor for more information.

The IRS may request itemized receipts for HSA purchases during tax time.

Always save your itemized receipts!


HSA Enrollment Eligibility

Most taxpayers are eligible for an HSA. However, you are ineligible for an HSA if:

• You can be claimed as a tax dependent on another person’s taxes. Generally, this excludes children under age 19 (or 24 for students), or other household members with limited income who are supported by the taxpayer.

• You are enrolled in Medicare. • You are covered by your own or a spouse’s non-HSA-qualified health plan, Flexible Spending Account (FSA), or Health Reimbursement Arrangement (HRA).

• You received any Veteran’s Administration health benefits in the last three months.

IRS Confirms ACA Mandate Penalties Still Effective


The Internal Revenue Service (IRS) Office of Chief Counsel has recently issued several information letters regarding the Affordable Care Act’s (ACA) individual and employer mandate penalties. These letters clarify that:

  •   Employer shared responsibility penalties continue to apply for applicable large employers (ALEs) that fail to offer acceptable health coverage to their full-time employees (and dependents); and
  •   Individual mandate penalties continue to apply for individuals that do not obtain acceptable health coverage (if they do not qualify for an exemption).

These letters were issued in response to confusion over President Donald Trump’s executive order directing federal agencies to provide relief from the burdens of the ACA.


These information letters clarify that the ACA’s individual and employer mandate penalties still apply. Individuals and ALEs must continue to comply with these ACA requirements, including paying any penalties that may be owed.


The ACA’s employer shared responsibility rules require ALEs to offer affordable, minimum value health coverage to their full-time employees or pay a penalty. These rules, also known as the “employer mandate” or “pay or play” rules, only apply to ALEs, which are employers with, on average, at least 50 full-time employees, including full-time equivalent employees (FTEs), during the preceding calendar year. An ALE may be subject to a penalty only if one or more full-time employees obtain an Exchange subsidy (either because the ALE does not offer health coverage, or offers coverage that is unaffordable or does not provide minimum value).

The ACA’s individual mandate, which took effect in 2014, requires most individuals to obtain acceptable health insurance coverage for themselves and their family members or pay a penalty. The individual mandate is enforced each year on individual federal tax returns. Individuals filing a tax return for the previous tax year will indicate, by checking a box on their individual tax return, which members of their family (including themselves) had health insurance coverage for the year (or qualified for an exemption from the individual mandate). Based on this information, the IRS will then assess a penalty for each nonexempt family member who doesn’t have coverage.

On Jan. 20, 2017, President Trump signed an executive order intended to “to minimize the unwarranted economic and regulatory burdens” of the ACA until the law can be repealed and eventually replaced. The executive order broadly directs the Department of Health and Human Services and other federal agencies to waive, delay or grant exemptions from ACA requirements that may impose a financial burden. However, the executive order does not include specific guidance regarding any particular ACA requirement or provision, and does not change any existing regulations.

IRS Information Letters

Office of Chief Counsel issued a series of information letters clarifying that the ACA’s individual and employer mandate penalties continue to apply.

    Letter numbers 2017-0010 and 2017-0013 address the employer shared responsibility rules.

    Letter number 2017-0017 addresses the individual mandate.

According to these letters, the executive order does not change the law. The ACA’s provisions are still effective until changed by Congress, and taxpayers are still required to follow the law, including paying any applicable penalties.

More Information

For additional information on the ACA Executive Order and the current tax filing season, please visit


Oregon Small Business Health Care Tax Credit

Any small business in Oregon with 1-50 employees can purchase an exchange certified plant from participating insurance carriers. Additionally, if you have a small business with fewer than 25 full-time employees, you could be eligible for the Small Business Health Care Tax Credit. 

The IRS Small Business Health Care Tax Credit helps qualified small businesses lower the cost of offering health insurance to employees. If you own a small business in Oregon, you must meet the following minimum criteria to qualify for the tax credit: 

  • Employ fewer than 25 full-time equivalent employees (not including family members of owners/partners, or seasonal workers who work fewer than 120 days during the taxable year.)
  • Pay average annual salaries of $50,000 or less per employee. 
  • Pay at least 50% of full-time employees' premium costs. 
  • Purchase a certified medical or dental plan. 

The maximum tax credit is 50% of the amount you pay toward your employees' premium costs (35% for tax-exempt employers). You don't need to offer coverage to your part-time employees or to dependents to qualify for the tax credit. 

If you own a small business and you believe you may qualify for the Small Business Health Care Tax Credit, please contact us today! 

Attention: Former Oregon's Health Co-Op Members

- In case you have employees with outstanding claims prior to July 31, they must be submitted to Oregon's Health CO-OP no later than 10/31/2016 to be considered for payment.

- Any outstanding claim for Oregon’s Health CO-OP members must be postmarked or electronically dated on or BEFORE October 31, 2016 to be considered for payment. Claims can continue to be submitted through current channels.

To submit claims electronically, use EDI Payer ID 45332

Paper claims should be mailed to:
Oregon’s Health CO-OP
PO Box 3948
Corpus Christi, TX 78463 – 3948

2017 Medicare Annual Enrollment


Fall is quickly approaching, and your Medicare annual enrollment period is just around the corner. The Medicare annual enrollment period applies to all Medicare Advantage and Prescription Drug Plans. Beginning October 15 thru December 7 you will need to decide if you want to keep your plan or change to another plan for 2017.  Here is a brief summary of what you need to know and do.

You will likely receive a lot of information from many insurance plans, but the most important information you need to review is the annual Notice of Change and Evidence of Coverage mailed from your current insurance plan. These documents will identify the 2017 changes to the monthly premium, copays, deductible, maximum out of pocket, and contracted providers.  To stay with your current Medicare Advantage & Prescription Drug Plans, simply inform the ISNW team listed below by phone or email.  Be aware; submitting a new application will automatically dis-enroll you from your current plan at the end of the year.
Medicare Supplement Plans, such as Plan F, do not have this same annual enrollment period and require no action from you at this time. If you want to switch from a Medicare Supplement Plan to a Medicare Advantage Plan, or the other way around, now is the time for us to talk about making that happen.

We are committed to assisting you with your insurance plan renewal by representing all insurance carrier options in Oregon & Washington.  We will email important bulletins related to the renewal, and post these notices on our website (see Resources/Blog).  
Please call or reply to this email to if you have questions and need to make a plan change.

Regence, BridgeSpan to remain in every Oregon county in 2017

Regence BlueCross BlueShield of Oregon and BridgeSpan Health today announced we will continue offering health plans for Oregon individuals and families in every county across the state in 2017. In July, Regence and BridgeSpan announced individual coverage would only be available in select counties due to shifting market dynamics and higher costs of delivering care.

“This is good news for the people and families across our state who need real choices when it comes to their health care coverage,” said Angela Dowling, Chief Business Development Officer for Cambia Health Solutions. “Through close collaboration with the State and our regulators, we are pleased to offer Oregonians choice while bringing greater stability to this dynamic and evolving marketplace.”

Health insurers nationwide are navigating the challenges posed by escalating medical and prescription drug costs, enrollment trends, shifting market participation and the end of some ACA stabilization programs. Ongoing financial losses have led to market exits across the country.

We are actively helping Oregonians across the state understand and navigate their options, including reaching out to those members with whom we previously communicated changes.

To read the Oregon Department of Consumer Services press release, please click here.

Possible Changes to Employer-Sponsored Health Insurance

We are sharing with you news of a present threat to the current system of tax deductibility of group health insurance premiums. We don’t believe we should lose tax deductibility of group insurance premiums and that is what congress is talking about right now, and we think you will agree. And here’s how you can help. Please read, and take action at the end – see #2 below. It only takes a couple of minutes. Please share this email with others.

Possible Changes to Employer-Sponsored Health Insurance System

At Insurance Solutions NW, Inc we are committed to providing our clients with the information they need to maintain affordable (as much as possible!) insurance thru employee benefits. As such, we would like to share with you a message recently distributed by the National Association of Health Underwriters (NAHU) of which we are a member.

Discussions are taking place in Congress that could result in the undermining of the employer-sponsored health insurance system by eliminating or placing a cap on the employer tax exclusion for health insurance:

NAHU is very concerned about ongoing discussions in Congress that would undermine the employer-sponsored health insurance system by eliminating or placing a cap on theemployer tax exclusion for health insurance. More than 175 million Americans currently receive their coverage through this system, largely due to the tax exclusion where employers provide contributions for an employee’s health insurance that are excluded from that employee’s compensation for income and payroll tax purposes. Eliminating the exclusion would eliminate the incentive for employer-sponsored insurance while capping it would degrade the benefit and serve as a tax increase for middle-class Americans.

The employer-based system is highly efficient at providing American workers and their families with affordable coverage options through group purchasing and its associated economies of scale by spreading risk and avoiding adverse selection. Eliminating the exclusion would eliminate most of the benefits of employer-sponsored insurance, including the means for spreading risk among healthy and unhealthy individuals and group purchasing efficiencies. Capping the exclusion for employees would devalue the benefit and result in a significant tax increase for middle-class Americans, forcing many to drop employer-sponsored insurance, including dependent coverage. Employers would be incentivized to only offer coverage to their employees that would fall below the value of the cap in order to avoid paying any increased taxes, potentially resulting in a race to the bottom for employers to sponsor insurance that wouldn’t meet the cap’s thresholds and further shifting costs onto employees. Many of the inherent problems with the Cadillac/excise tax would exist for eliminating the employer exclusion such as setting a tax credit sufficiently high enough to cover the significant contribution made by employers today. Also, indexing a credit would need to be set to medical inflation if it is to keep up with the typical rise in healthcare expenses.

The employer exclusion tax benefit makes employer-sponsored health insurance a valuable benefit for workers. We urge Congress to maintain the system that has worked for Americans for decades, and preserve employer-sponsored health insurance through the continuation of the employer exclusion because it preserves the employer system for health insurance for the vast majority of Americans. Over the coming weeks, as Congress discusses various healthcare reform proposals, we want to be sure that they hear directly from agents, brokers and employers about the value of the employer tax exclusion. You can help us spread the message by taking action below:

  1. Contact your senators and representative. Send an Operation Shout today asking your federal legislators to oppose the elimination or cap of the employer tax exclusion of health insurance in any healthcare reform legislative proposals. You can also call your legislators at the numbers below.
  2. Tell your employer clients to take action. Your employer clients would be most directly impacted by the elimination or cap of the employer tax exclusion. Tell them to take action sharing why the exclusion must be preserved in any healthcare reform legislative proposals.Tell them to take action here.
  3. Share your story. As a licensed insurance specialist who works closely with employers to help them offer and utilize employer-sponsored health insurance, you know personally about how the employer tax exclusion directly impacts your clients. Stories from your clients will demonstrate the value of the exclusion and the need to preserve it. We will share your stories with appropriate legislators and staff. You can share your story here.

Take action today and tell your federal legislators to keep the employer exclusion tax benefit!

Take Action