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Do Health Savings Account Plans Work Question & Answers

2013 November 2
by Sarah Fields

George asks…

What percentage of my income should go to rent?

Trying to plan for next year. Two things to mention: I have no debt (paid off!) and I don’t plan on having a car.

I’m thinking 38% but I’ve read a couple places it should be much lower than that. I make about 30k (after taxes) per year. I plan on renting, for now.

Any help would be great and thanks!

Sarah Fields answers:

38% is the maximum.
You never want to go by the maximum if you want to be able to enjoy a dinner out or take a small vacation once a year or so.
Everyone’s different. I would feel comfortable at 25%
Which would put your monthly rent at $625/month.

Don’t forget to always have 6 months worth of living expenses in a savings account in case something like a health issue or loss of job would happen.
Never dare take a step without that safety cushion.

Mandy asks…

How can my wife and I live in a clean safe house that we can modify as required by her illness?

Also in other catagories
We have no savings, and our credit rating is getting worse each month, because I am not paid enough even if I work OT, and everything is so expensive.

We don’t live to excess, we need special food that she is not allergic to, we need to run air filters, we need to make co-pays for her appointments with specialist.

I don’t dare change jobs because of the insurance.

Can we just get rid of the rich people so the rest of us can get what we need.
She has not been officially diagnosed. We know she is sick and getting sicker, but other than Celiac, we don’t know if she has Lupus, RA or something worse. We believe it is lupus, but there is no help until it is official, even if they are just not ruling out the more devastating options.

Sarah Fields answers:

It sounds like you are doing as much as you can. You can also maybe speak with your benefits person at work at maximize how you use your health plan. Sometimes they have accounts where you set aside money to pay for medical expenses before taxes. You can also try to write or call the pharmaceutical company that makes the medicine your wife is on and ask if they have a program to assist you with the cost. You might also ask her doctor if he has any free samples of that medication or is there any other medicine that is less expensive.

Michael asks…

Trying to understand obamas plan for medical care, need explanation in lamens terms?

From what I understand the new plan will be much like canadas, I have heard the biggest problem with this is that if you have, say cancer, you could die before treatment. Why is the wait so long? Is there any way to fight this considering my state did not fight this plan? Can anyone explain the new plan in a simple form? Sorry I know there are many questions here.

Sarah Fields answers:

It isn’t quite the same thing. In Canada, all health care is paid for by the government (the money comes from taxes) but services are provided by Private Companies. The system is known unofficially as “Medicare”.

Obama’s health care reforms are not a takeover, but an increase on regulations on the Private Health Insurance Companies who pay for most of the health care in the US. At present, insurance companies offer a confusing array of insurance plans and costs vary wildy from state to state, and in the recent economic downturn some companies have imposed huge increases on insurance costs. The health care plan also aims to address the 10 million Americans who currently aren’t covered by either private insurance or covered with government-funded Medicare (for the elderly) and Medicaid (for the poor).

The purpose of “Obamacare” is to increaes government funding on health care, simplify health insurance plans, create competition among insurance companies and make owning insurance compulsory. The costs will be funded in the short term by taxes on some services, medical devices, indoor tanning, people without insurance, the most expensive insurance plans, etc. And in the long term by savings made in Medicare.

The reform is complex and can’t be summarised by the GOP’s catchphrase of “government takeover of health care”. As of late 2010, the following regulations are now in place:
– Insurance companies can’t drop people from coverage when they fall ill
– Insurance companies can’t exclude children with pre-existing medical conditions
– Insurance companies have to account for their expenses
– Insurance companies are losing their ability to restrict how much money a patient can claim
– Improved fraud detection.

The key package will come into force in 2014:
– Insurers can’t refuse coverage to anyone with pre-existing medical conditions
– Health insurance exchanges will be set up, to make buying insurance easier and simpler
– A tax on people who don’t buy insurance
– Simplifying of insurance plans.
– Employers of large businesses must provide health insurance. Some businesses will get tax credits to fund this. Small businesses aren’t included
– Providing some funding for families with a relatively low income (but not low enough to be eligible for Medicaid)
– Increasing Medicaid availability

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