Medical Savings Accounts
Voluntary Beneficiary Association (VEBA)
The VEBA Plans feature a Consumer Directed Health Plan (CDHP) that works alongside a tax-exempt personal health account. This plan is offered through participating Minnesota Service Cooperatives and Blue Cross Blue Shield of Minnesota. It gives you a way to reduce your health care costs while allowing employees more control and choice in their health care usage. Simply put, we’ve created a health plan that works alongside a tax-exempt VEBA personal health account. The health plans feature a higher deductible, so premiums can be lower than traditional plan coverage. The interest-earning account is employer-funded and can be used to pay for qualified medical expenses until the deductible has been satisfied. Since the funds in the account are not taxed, your health care dollar goes farther. Also, the funds in the account will carry over from year to year.
Health Savings Account (HSA)
A Health Savings Account (HSA) is a tax-advantaged medical savings account you can contribute to and draw money from for certain medical expenses tax-free. HSAs can be used for out-of-pocket medical, dental, and vision. HSAs can't be used to pay health insurance premiums.
Consumer Directed Health Plan (CDHP)
CDHPs come in various forms, but most commonly a CDHP means offering a high-deductible health plan paired with spending account for out-of-pocket costs such as a Health Savings Account (HSA) or Integrated Health Reimbursement Arrangement (HRA) also referred to as a VEBA.
Minimum Value Plan (MVP)
A standard of minimum coverage that applies to job-based health plans. If your employer’s plan meets this standard and is considered “affordable,” you won’t be eligible for a premium tax credit if you buy a Marketplace insurance plan instead. A health plan meets the minimum value standard if both of these apply: It’s designed to pay at least 60% of the total cost of medical services for a standard population. Its benefits include substantial coverage of physician and inpatient hospital services.
For more information on your Medical Savings Accounts contact:
Marlo Peterson, Consumer Directed Business Consultant, Northeast Service Cooperative
Purchasing your group health insurance and selecting your health savings accounts such as VEBA, FSA and HSA through your Service Cooperative can save you and your organization money. Just like buying your groceries in bulk at a wholesale club, the Service Cooperative negotiates health care costs collectively and can secure lower costs and deliver greater value. And here’s the best part: the savings and value are passed on to you.