How Do You Afford Private Health Insurance On A Low Income?

It has been a question raised by every single American on how to acquire private health insurance with better benefits, however, with private health insurance prices that are way up a higher a low-income earning American could almost impossible be able to take advantage of one. Moreover with certain strategies that an average American can come up with it is not impossible to get private health insurance  to acquire. Here are some helpful ways on how to do it.

Go Off-Exchange
It may seem a better option to buy off-exchange directly from an insurance provider, it has been proven this year after the new administration that cut off the funds for insurance companies subsidies that allowed low-income earners to afford private health insurance with better benefits. Most insurers even boosted premiums on plans that require to be subsidized by the ACA exchanges. This resulted in insurance plans being sold at a cheaper price.

Join a Group Health Insurance
In order for you to buy a less expensive private health insurance, it is best to join a professional association, membership organization, a trade group or an alumni group. With this membership group, you will be pooled with other members of the group so your premiums will be lowered as the fees will be divided within the members of the organization. Organizations such as the National Association for the Self-Employed and the Alliance for Affordable Services will be able to help you out as their members include small business owners and entrepreneurs. This may be a good option for you to consider.

Invest Money on HAS
Since you have considered buying a high-deduction kind of health plan, you will be eligible to put your money on the health savings account, it can also help you lower your adjusted gross income. Putting your money on HAS is one of the good ways to cover some of the healthcare expenses.

Premium Deductions
In the event that you will not be able to have access on an employer-sponsored plan, what you can do is you can deduct 10 percent of your health insurance on your taxes. A medical expense deduction is also another way to cover the premiums. It allows people with high healthcare cost to deduct their spending. The qualification is that your medical expenses must be 10 percent out of your entire income.

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2019 HSA Contribution Miminums And Maximums

HSAs (Health Savings Accounts) are designed to help employees put aside money to pay for extra medical expenses on a pre-tax basis, both have protocols around maximum contributions and permissible distributions, and both have remarkably similar sounding acronyms. However, the similarities for the most part, stop here.

Some researches often answer the questions from employers who are confused as to how these two types of accounts impact each other. Most of these questions are a result of misunderstanding 2019 HSA eligibility rules, or applying these rules to another account called FSAs. In this article, we will briefly discuss both HSAs and FSAs independently, and then discuss how they impact each other in terms of eligibility.

Health Savings Accounts (HSAs)

What is an HSA?
This account is often referred to as the Consumer Driven Health Plan (CDHP). An HSA is an account through which eligible individuals can make contributions, and receive employer contributions, on a tax-free basis through an employer’s cafeteria plan. Whether an individual has the eligibility to contribute to 2019 HSAdoes not impact whether the individual is eligible for the underlying high deductible health plan. Furthermore, the individual and his or her spouse and dependents do not need to be eligible to contribute to it, to take tax-free distributions from that account for qualified medical expenses. An account is owned by the individual and not by the employer. Thus, individuals will have access to the account after employment with an employer ends.

Eligibility
To have the eligibility to contribute to (or forward contributions to) an account, two things must be true: First, the individual must be covered under a qualified high deductible health plan (QHDHP). Second, the individual must not be covered by disqualifying other coverage.

A high deductible health plan is deemed qualified, and allows a person to contribute to an HSA, if it meets both the minimum annual deductible standards and the maximum out-of-pocket limit standards set by the IRS.

As an additional to being enrolled in a QHDHP, an individual who may not be enrolled in any other health care plan that is not a QHDHP, before the minimum annual deductible is met, to be HSA eligible. Examples of other coverage that will cause a person to lose HSA eligibility are other major coverage for medical purposes, general purposes health FSAs, HRAs (Health Reimbursement Arrangements), and Medicare. Contributions to an HSA are still subject to limits set by the IRS. The limits are updated annually, and are impacted by a certain number of people covered by the qualified HDHP, the number of months out of the year an individual is eligible for an HSA, and the individual’s age.

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