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Health Care a Hot Topic for 2020

One issue sure to ignite the 2020 election year is the
future of health care in America. As Congress resumes its session this fall,
legislators on both sides of the aisle are anxious to pass health-care-related bills
to gain positive campaign traction. Popular proposals include legislation to
lower prescription drug prices and ban surprise medical bills.1

So far in 2019, 33 states have passed 51 laws relating to
drug pricing, affordability and access. State legislatures have deployed
several new measures, such as allowing prescription drugs to be imported from
other countries, monitoring excessive price increases by drug manufacturers and
establishing oversight boards to set drug prices paid by state and local

If you’re concerned about the rising cost of health care and
how it could affect your household budget, consider planning for higher
increases in the future. Some Republicans in Congress have indicated that,
should President Trump win a second term, they hope to reduce the nation’s ballooning
deficit (projected to reach $1 trillion in fiscal year 2020) by reducing
Medicare and Social Security benefits.3 With this in mind, we can
help you explore tax-efficient ways to address health care expenses in
retirement. Feel free to contact us for more information.

Employer options expanding

The federal government also has introduced a new rule that
may help small businesses provide an additional health insurance option for employees.
It allows employers to make tax-advantaged contributions to “health
reimbursement arrangements” (HRAs). These accounts currently exist, but, until
now, funds could not be used to purchase health insurance on the individual
market.  Beginning in January 2020, the
new rule enables employers to offer this option to employees who do not have
access to a company-sponsored plan. Workers will not have to pay income taxes
on amounts the employer contributes to their HRA.4

The new rule gives employers the option to cease offering a
company-sponsored health insurance plan and instead provide contributions to an
HRA. Some observers say this change eventually could mirror the way companies
used the 401(k) plan to stop offering defined benefit retirement pensions.5

Coupons for medical services

In an effort to reduce health care
expenses, some consumers are turning to Groupon for discounts. Medical
companies and facilities across the country have negotiated with the coupon website
for procedures including mammograms, MRIs, CT scans and even back surgery. The
strategy helps hospitals and other medical facilities generate a new revenue
stream while giving uninsured patients an avenue to afford expensive medical

Content prepared by Kara Stefan Communications.

1 Kaiser Health News. Sept. 9, 2019. “Beyond Gun
Control: Prescription Drug Prices, Surprise Medical Bills Are At Top Of
Congress’ Health Agenda For Fall.” Accessed Sept. 10, 2019.

2 Steven Findlay. Kaiser Health News. Sept. 9, 2019. “States
Pass Record Number Of Laws To Reel In Drug Prices.” Accessed Sept. 10, 2019.

3 Teresa Ghilarducci. Forbes. Aug. 23, 2019. “Trump’s
Second-Term Plan For Social Security: Starve The Beast.” Accessed Sept. 10, 2019.

4 Michael Kolber. The Hill. Aug. 20, 2019. “Could next
year be the beginning of the end of traditional employer-sponsored health
insurance?” Accessed Sept. 10, 2019.

5 Ibid.

6 Lauren Weber. Kaiser Health News. Sept. 6, 2019. “Groupons
For Medical Treatment? Welcome To Today’s U.S. Health Care.” Accessed Sept. 10, 2019.

We are an independent
firm helping individuals create retirement strategies using a variety of
insurance products to custom suit their needs and objectives. This material is
intended to provide general information to help you understand basic retirement
income strategies and should not be construed as financial advice.

The information
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