Hsa advantages , Financial Accounting

Assignment Help:

A HEALTH SAVINGS ACCOUNT AT FRONTLINE PR

Susan Berry just returned from a national conference on compensation and benefits where she attended a session on Health Savings Accounts (HAS). Susan is the Human Resources Director at Frontline PR and her company has been struggling with the cost of healthcare insurance. After speaking with several experts at the conference, Susan now thinks an HAS might be a viable option for the company. Frontline PR is a public relations firm located in the Northeast that employs close to 150 people in four different offices. Public relations professionals make up most of the staff, but they also employ a complete administrative and operations staff. All of Frontline's employees work full time schedules and are eligible to participate in their healthcare insurance plan. Frontline currently offers a standard fee-for-services healthcare insurance option. The plan has a modest deductible of $300 per year and a 20 percent coinsurance requirement. In addition, the company offers a Flexible Spending Account (FSA) that allows employee's to set aside pretax earnings to pay for the deductible, coinsurance, and other medical expenses. Susan is considering offering a HAS along with high-deductible health insurance plan instead of the current insurance plan and FSA. At the conference, Susan learned that making such a change could result in significant cost savings for a company. The high-deductible health insurance plan would cost a lot less for a company than the standard fee-for-services plan that Frontline currently offers. While Susan suggest the Frontline make contributions to each employee's HAS, the overall costs for the healthcare benefit would still be less than its current option. Beyond cost savings on premiums, many believe that consumer-driven healthcare tends to reduce overall healthcare costs. Some of the experts Susan spoke to at the conference stated that when employees have a greater say in their healthcare decisions, they make wiser decisions and do not spend as much on healthcare. Susan has discussed the HAS option with Frontline's Director of Finance, Allison Jones. From the financial perspective, Allison agrees that the option would be a good step to start controlling healthcare costs. However, as an employee who would use the benefit, Allison isn't so sure that an HAS with a high-deductible health insurance plan is the right option for the company. Based on Susan's initial explanation, Allison didn't really understand how the HAS worked. Further, she was concerned that she would have to spend more out of pocket on her own healthcare. Susan is convinced that the HAS option would offer a significant cost savings to Frontline. However, after her discussion with Allison, Susan is still unsure if it is the right path to recommend for her company.

QUESTIONS:

1. What are some advantages of implementing the HSA option?

2. What are some potential disadvantages of the HAS option?

3. What do you recommend? Why?


Related Discussions:- Hsa advantages

What do you understand by measurement date in stock option, Q. What do you ...

Q. What do you understand by Measurement Date in stock option? Measurement Date - The date at which equity share price and other pertinent factors, like expected volatility tha

Powerpoint presentation, I have a presentation on an article (around 20 pag...

I have a presentation on an article (around 20 pages). I also need 2 current real life examples (2 companies) to support the presentation. Can you do that? How long it will take yo

PB7-1 Analyzing the Effects of Four Alternative Inventory Me, Mojo Industri...

Mojo Industries tracks the number of units purchased and sold throughout each accounting period but applies its inventory costing method at the end of each period, as if it uses a

Analysis of the financial results, An introduction to the company, which fo...

An introduction to the company, which focuses on the context in which the company operates: • Ownership, development and location; • Resources, processes and employment; •

Conditions of a will-executorship laws and accounts, Conditions of a will ...

Conditions of a will A written will is not valid unless it fulfills the following conditions. 1) The testator must sign the will; or he must affix his mark to the will (i.e. a

Estimate parametric market var, You have an investment in a portfolio with ...

You have an investment in a portfolio with a counterparty whose current credit rating is Baa. The current market value of the portfolio is $50,000,000 and its annual volatility is

Generally accepted accounting principles (gaap), Generally Accepted Account...

Generally Accepted Accounting Principles (GAAP) are guidelines for companies to follow as tehy prepare and issue financial statements. Let's start by getting an understanding of wh

Cumulative and substitutional legacies and devises, Cumulative and substitu...

Cumulative and substitutional legacies and devises Where a will makes two gifts of unequal amounts to the same person, they are assumed, in the absence of a contrary indication

Re-order period - standard eoq model, The standard EOQ model supposes that ...

The standard EOQ model supposes that materials can be procured immediately and thus implies that the firm may place an order for replenishment as the inventory level drops to zero.

Introduction to pension funds, Introduction to Pension funds Pension fu...

Introduction to Pension funds Pension funds are normally set up to provide pension benefits to employees who have retired. The pension funds receive contributions mainly from e

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd