Health Net Small Business Group has introduced two HSA-Compatible Health Plans — PPO 2000 and PPO 3000. Both have been designed to give consumers a tax-efficient way to manage their health care. Employers can offer these plans in conjunction with a Health Savings Account.

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Beginning with January 1, 2005 effective dates, employers and employees can begin taking advantage of the many savings and tax benefits associated with these new offerings from Health Net.

Health Savings Account (HSA) Compatible PPO 2000 OR 3000 Plan Benefits:

Direct access to physicians

No referrals required to see a specialist

Coverage for non-network services at a lower benefit level.

Prescription drug coverage available for retail and mail order services.

$5 million lifetime maximum
HSA Benefits:


Funds provide initial coverage for "qualified expenses" that include services typically covered under a traditional health plan.1

Individual contributions are tax-deductible.

Employer contributions are not subject to FICA or FUTA taxes.

The funds can be invested, and earnings are non-taxable.

The funds are not "use it or lose it," but can rollover to the following benefit year.

Maximum contributions for 2004 are $2,600 (individual enrollee) or $5,150 (family).

HSAs are portable — the accounts are your employees' to keep.

HSAs must be used in conjunction with HSA-compatible, high deductible health plans.
These plans are available for quoting November 1, 2004, with an effective date of January 1, 2005.
PPO 2000 PPO 3000
Annual Deductible $2,000 single/$4,000 family $3,000 single/$6,000 family
Maximum Annual $4,000 single/$8,000 family $5,000 single/$10,000 family

Out-of-Pocket Expenses
Office Visit 30% 30%
Inpatient Care 30% 30%
Outpatient Services 30% 30%
Retail Pharmacy $15/$30/$50 $15/$30/$50


PLEASE NOTE: These plans are intended to be used only as stand alone high-deductible health plans or alongside a health savings account banking arrangement. It is completely at the discretion of the employer and employee whether or not to establish an HSA with a qualified custodian of their choice. This communication is for general information only. For complete information on HSA tax savings and eligibility, contact your tax professional.


1 US Employers See A Role For New Health Savings Accounts In Their Benefit Programs, Mercer Human Resource Consulting LLC, April 27, 2004


The purpose of this update is to provide information about industry trends and Health Net news of general interest. Information about products, offerings, service, or benefits is illustrative and general in description, and is not intended to be relied on as complete information. Please contact your Medicoverage representative (888 285 6334) for more detail about specific products or services. While every attempt is made to ensure the accuracy of the information provided, Health Net does not warranty the accuracy of the information.