The trustees of the Employees Retirement System of Texas recently received recommendations from staffers on a new option that will be available to covered employees and retirees who aren’t eligible for Medicare. You don’t have to switch health plans, but during the upcoming Summer Enrollment period, you can select this new health coverage option, to start September 1, 2016.
The plan combines a high-deductible health plan (HDHP) design with a health savings account (HSA). Making the switch may be financially advantageous for some individuals, but should be considered very carefully. The key feature of an HDHP is in its name: the high deductible. Participants will have to pay an annual deductible before the plan will pay most medical and prescription benefits, with the exception of preventive services.
UnitedHealthcare will also administer the HSA, which is like a nest egg for health care expenses. An HSA allows participants to use pre-tax funds for eligible health care expenses. UnitedHealthcare doesn’t approve or deny reimbursements but participants must ensure their payments are made on eligible expenses. Participants enjoy tax-free interest earnings and, in some cases, can decide how to invest their funds. Unlike a health care flexible spending account, all unused funds will roll over to the next year.
Here is a link for more details.