The Treasury Department and Internal Revenue Service recently released 2009 guidelines for maximum contribution levels for Health Savings Accounts (HSAs) and out-of-pocket spending limits for high deductible health plans (HDHPs) that must be used in conjunction with HSAs. The 2009 IRS requirements are:

Minimum Deductible: $1,150 single plan; $2,300 family plan
Maximum Out-of-Pocket: $5800 single plan; $11,600 family plan
Contribution Maximum: $3,000 single plan; $5950 family plan

New Annual Contribution Levels for HSAs

• The maximum annual HSA contribution for an eligible individual with self-only coverage is $3,000.

• For family coverage, the maximum annual HSA contribution is $5,950.

• Catch-up contribution for individuals who are 55 or older is increased to $1,000 for 2009 and all
years going forward.

• Individuals who are eligible individuals on the first day of the last month of the taxable year (December 1 for most taxpayers) are allowed to make the full annual contribution (plus catch up
contribution, if 55 or older by year end), regardless of the number of months the individual was an eligible individual in the year. For individuals who do not maintain eligibility for the 13-month
testing period following that date, both the HSA contribution and catch-up contribution should be prorated based on the number of months of the year a taxpayer was an eligible individual. New Amounts for Out-of-Pocket Spending on HSA-Compatible HDHPs

• The maximum annual out-of-pocket amount for HDHP self-coverage increases to $5,800. The maximum annual out-of-pocket amount for HDHP family coverage is twice that at $11,600. Minimum Deductible Amounts for HSA-Compatible HDHPs

• The minimum deductible for HDHPs increases to $1,150 for self-only coverage and $2,300 for family coverage. In addition, a fiscal year plan that satisfies the requirements for an HDHP on the first day of the first month of its fiscal year may apply that deductible for the entire fiscal year.

Tags: health insurance, Health Savings Accounts, hsa, irs, irs insurance

North suburban hospital operator Evanston Northwestern Healthcare said it will acquire Rush North Shore Medical Center in Skokie, committing more than $160 million to the deal, according to a definitive agreement finalized today.

As part of the deal, which still needs approval of regulators including the Federal Trade Commission, Evanston Northwestern will retire Rush North Shore’s $54 million in debt and contribute $10 million to a community foundation. In addition, Evanston Northwestern will commit $100 million in capital over the next several years that includes establishing an electronic medical record system at the Skokie hospital.

“The merger will provide enormous benefits to the patients and families we serve for generations to come,” said James Frankenbach, president of Rush North Shore.

Evanston Northwestern operates hospitals in Evanston, Glenview and Highland Park. Rush North Shore is affiliated with Rush University Medical Center on the West Side and Rush-Copley Medical Center in Aurora through a so-called obligated group, which allows them to cooperate on financing needs. If Rush North Shore issues debt through the group, the other member hospitals would have to sign off on the spending plan.
But the obligated group these days is more focused on funding a huge renovation at Rush University Medical Center on Chicago’s West Side so Evanston Northwestern’s retirement of the Rush North Shore debt will help in the Rush University financing plan.

The Federal Trade Commission, which has taken issue with Evanston Northwestern’s acquisitions in the past, has not asked for additional information from the merging parties in this deal, Rush North Shore executives said.

Evanston Northwestern and Rush North Shore executives said they expect the deal to close by the end of the year.

Earlier this year, the FTC made official an earlier decision ordering Evanston Northwestern and Highland Park Hospital to contract separately with managed-care plans. Although Highland Park is owned by Evanston Northwestern, the FTC said that the two parties must allow health insurance companies to “negotiate separately again for those competing hospitals, thus reinjecting competition between them for the business of [managed-care organizations].”

Last year, the FTC affirmed a 2005 ruling by an administrative law judge that found Evanston Northwestern’s 2000 acquisition of Highland Park to be anti-competitive and in violation of federal law. The FTC did not order a divestiture of Highland Park but the agency and Evanston Northwestern came to an agreement .

The FTC alleged prices at Highland Park rose 50 percent or more in certain instances after the merger, compared with price increases of 4 percent to 6 percent in the several years preceding the combination.

Evanston Northwestern argued that its rate increases were catching up with poor managed-care contract negotiations in the past and that it invested more than $150 million in the facility.

Tags: Evanston hospital, merger, Northwestern Hospital, Rush Hospital, Rush North Shore Hospital

WASHINGTON–(BUSINESS WIRE)–The National Association for the Self-Employed (NASE) today released data from the only national survey to measure the impact of rising healthcare costs on micro-businesses and the self-employed. The survey of nearly 4,000 micro-businesses, a follow-up to research conducted in 2005, shows that high cost continues to be the most significant barrier to offering health insurance and that small businesses strongly feel they are at a disadvantage compared to their larger counterparts when it comes to access to coverage.

“While we do see some encouraging data this year, the fact remains that access to health care is the most significant issue facing this country’s smallest businesses,” said Kristie Darien, Executive Director of the NASE. “The baker, the house painter, and the 20 million other micro-businesses in the United States already are struggling to survive in this economy. These businesses could be further threatened if we cannot find a way to make insurance more affordable.”

Numbering over 24 million, micro-businesses often are cited as the drivers of America’s economic engine, creating well over a third of all new jobs. The data collected in the NASE survey were segmented to explore key differences among respondents, including number of employees and total 2007 gross sales, both critical factors in determining the impact of rising health care costs on a business.

Survey Highlights – Coverage

• About two-thirds (67%) of respondents say they have personal health insurance coverage, a notable increase from the 54.9% who reported the same in 2005.

• In a surprising shift, the percentage of responding businesses whose plans cover full-time employees dropped significantly from 46.2% in 2005 to 18.6% in 2008.

• Companies with gross sales under $50,000 experienced the greatest increase in access to health care coverage – 40% presently offer insurance compared to only 13.8% in 2005.

Survey Highlights – Cost

• More than 65% cite cost as the single most significant barrier to offering health insurance to employees.

• Results show a significant increase in the percentage spent on health insurance premiums since 2005, with median costs rising from 3.7% of total revenue to 5.5%.

• One in 10 of the 2008 respondents spend 25% or more of their gross revenue on health insurance, compared to 10.1% in 2005, representing a 48.6% increase.

• Overall, costs have increased an average of 14.7%, compared to a 20.7% increase in 2005.

• Two issues respondents feel have the greatest impact on high health care costs are “insurance companies making too much profit” (28.8%) and “doctors/hospitals charging too much for services” (21.7%).

The survey also shows that small businesses with the least end up paying the most in terms of health insurance costs. Micro-businesses grossing less than $50,000 annually spend a median of 17.6% of their gross 2007 sales on health insurance, compared to a median of only 1% spent

Tags: insurance survey, NASE

Democrats back governor on health care

Tags: health insurance, illinois insurance