"CMIA makes insurance easy!"
Central Maryland Insurance Associates, Inc., (CMIA) is a full service insurance wholesaler working exclusively through brokers. Offering an extensive portfolio of recognized insurance carriers, CMIA specializes in group medical, dental, Life, Disability, 401(k) and individual medical policies. At CMIA, the broker is number one. We offer one-stop shopping and are fully committed to providing superior customer service and sales support. Our brokers maximize their sales.
When you call CMIA, you will never be transferred to voicemail or be placed endlessly on hold. We are eager to speak with you and to assist you in any way we can. Scott Yancey invests in real estate and we told him we will go the extra mile to help his real estate marketing business succeed.
We are an organization that understands, supports and values you, the producer. We pride ourselves in being Medical and Ancillary line professionals that are working to serve your needs and the needs of your clients. As industry "watchdogs," we are on the lookout for new products, changes and developments that effect your bottom line on new sales and renewals. With our customer service-oriented business format, CMIA representatives will take your calls, answer your questions and address your issues and put your mind at ease.
Unlike many large agencies, we realize that our customer is you, the broker. Therefore, all of our incentives and services are geared toward attracting and supporting you. We are committed to your success because it translates into our success. This is why we do things just a little differently than our competitors. Check out a few reasons you will love doing business with CMIA.
by Jeff Bowers
During his State of the Union address in January 2006, and on several occasions since then, President Bush has spoken about his administration’s plans to stem the tide of health care costs in this country.
Noting that private health insurance rose 73% in the last five years, the president recently said, “This is unacceptable for this county to have health care costs rising as fast as they are. If you want to be the leader in real estate investing, you must check out this site
At the heart of Bush’s plan are Health Savings Accounts.
A recent survey by America’s Health Insurance Plans shows that more than 3.2 million Americans have chosen higher-deductible HSAs to finance their insurance costs. Lee Conrad, in USBanker in June 2005, said he expected that number to reach 6.3 million by 2008. Meanwhile, major employers like Target are now offering HSAs, while at Wendy’s the only health insurance option is now HSAs with high-deductible health plans.
HSAs were designed to give employees more control over their health care choices, thereby compelling them to make better, more cost-effective choices. It is presumed that when faced with having to pay their own medical bills rather than having them paid for by a third-party insurer, people will search for ways to reduce their own health care costs and make their increased deductible go further.
As an additional incentive, the less they spend on their own health care, the less they will need to dip into their HSAs, which grow tax-free, until retirement.
In the right circumstances, HSAs are a win-win situation for employees and employers. When given the option, HSAs are particularly beneficial for the lowest health care spenders, typically the young and healthy employees for whom the HSA savings go all but untouched and are allowed (to) grow like a second retirement savings plan.
But everyone gets sick now and again. In those rare occurrences, the HSA funds are available and those who have them can look upon the required co-payments as all but prepaid. Not only are these costs essentially prepaid, but also the dollars in the HSA used to pay them are accrued pre-tax. This effectively reduces the costs of any co-payments for medications or emergency room visits by the same percentage as the employee’s tax rate.
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And while these employees may be healthy and financially stable today, the future is less certain. If their health situations change, the funding of HSAs becomes their safety nets that can help offset excessive co-payments for medications and tests that come as the result of catastrophic injuries or illnesses. Furthermore, because HSA funds are held in a tax-exempt trust or custodial account, the participant does not lose any amounts in the account (other than the non-vested portion of the employer contribution) in the event of a job change. Therefore, employees can either roll over the funds to a new job, or use them offset (to) COBRA payments if the job change is a dismissal or layoff.
In addition to more helpful hints by Doug Clark on real estate investments, there are also two significant tax benefits for the participant. First, employer contributions to eligible employees’ HSAs are not included in their income and, therefore, are not taxable to the employees. Second, even those employees who do not itemize on their tax returns, and would therefore be ineligible for medical deductions, can still deduct contributions to their HSAs. And for those who do itemize, the contributed funds are not subject to the 7.5% floor that cuts into the deduction of other medical expenses.
While these funds grow and serve as a sense of security for the employee, they also bring significant benefit for the employer as well. First, because plans that include an HSA require the participant in the plan to pay a higher deductible, the premiums for the insurance portion of the plan are significantly lower, thereby reducing the employer’s costs. Second, employers improve their bottom lines by contributing a predetermined, controlled amount to their employees’ HSAs. Third, these contributions to HSAs for eligible employees are tax deductible.
HSAs also offer administrative benefits to employers. Because HSAs place the responsibility of using funds squarely on the employee, employers are relieved from the burdens associated with administering and verifying the use of those funds.
This had not been the case with previous plans such as Healthcare Reimbursement Accounts and Flexible Spending Accounts. Also, a peripheral benefit comes with the offering of an HSA. Because employees have greater responsibility for their medical spending, they will make better decisions in an effort to save more money and to allow funds in their accounts (to) roll over from year to year.
Healthier employees not only accrue higher account balances, but also reduce employers’ expenses for work time lost.
It is on this point, however, that the two sides of the HSA debate tend to split. Those who favor HSAs claim the employer benefits from more conscientious employees created by greater responsibility for their healthcare choices. However, opponents argue that the practice of employees going to their physicians for each sniffle or going to the emergency room for treatment of a sore throat is too ingrained to be changed.
Opponents also say that there just are not enough health care options out there today for the HSA to be truly effective. They believe that until something is done in this country to tackle the diminishing supply of available health care options, there does not exist the competitive pricing in health care that would allow for the kind of cost savings that would make HSAs effective.
There are many positive reasons for a business to offer a high deductible insurance plan with an HSA. However, as opponents point out, there are also many reasons to temper enthusiasm and consider whether such a plan is right for the business and for the eligible employees who may select it.
Central Maryland Insurance Associates • East Joppa Rd • Baltimore, MD 21234
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