What If I have a Catastrophic (high expense) accident or sickness?
Your CustomCare plan is a very tax-efficient way to be reimbursed for every day medical expenses incurred but the expense of a large unforeseen accident, sickness or disease may be daunting. Catastrophic Medical Insurance acts as a "stop-loss" against these large unforeseen expenses that your business may not be able to comfortably budget for. Click here for more details.
Catastrophic coverage provides the following benefits:
Can I add Travel Insurance?
You have enough to worry about when taking a trip without remembering to buy travel insurance. Click here to add CustomCare annual Travel Insurance.
I or my spouse already has a plan, do I need another?
Many people may be covered by a spousal plan, however, such plans often prohibit therapeutic services or only pay a small portion of the total expense (i.e. 80% of dental cleaning). Now there is a way to avoid additional billing expenses that you end up paying for with after tax dollars, ie. physiotherapy, laser eye surgery, naturopathic consultations, medications etc. You can deduct the portion not already covered by your existing plan (i.e. 20% of dental cleaning) with your CustomCare PHSP.
Can I qualify if my health is poor?
Unlike many insurance based programs, there are absolutely no health qualifications.
Is there a minimum salary that must be drawn from the corporation to qualify?
As owners/employees, you must draw a minimum salary. We suggest you draw a minimum of $400 per month to be considered an employee of your company and to be eligible to participate in a PHSP. CRA states that PHSP benefits must be reasonable in relation to employment income earned. Special rules apply to Sole Proprietors. Click here for more details.
What is a Private Health Spending Plan (PHSP)?
It is a Canada Revenue Agency approved private health care plan that allows self-employed individuals, limited partnerships and corporations to self-insure and deduct their health and dental expenses in a tax-effective and cost-efficient manner.
Contributions made by an employer to or under a private health services plan (or Health Spending Account or Private Health Spending Plan) on behalf of an employee are excluded from the employee's income.
The amounts so paid must be for one or more of:
(a) the employee
(b) the employee's spouse and
(c) any member of the employee's household with whom the employee is connected by blood relationship, marriage or adoption.
A private health spending plan (PHSP or HSA) takes advantage of Section 248(1) of the Income Tax Act. The CustomCare PHSP is administered by CustomCare Inc.
IT339R2 - Meaning of private health services plan
Why do I need CustomCare Inc. to manage my PHSP?
Canada Revenue Agency (CRA) requires a 3rd Party Trustee and Administrator to adjudicate PHSP plans for accuracy and legal compliance.
As a smaller business, can I still have large company type benefits through this plan?
Yes. Any medical or dental benefit plan is effectively a reimbursement service for the employer. The purpose of having medical and dental expenses reimbursed by a benefit provider is so that the employer may deduct a premium for the payment of such a plan.
Many people incorrectly assume that medical/dental reimbursement is a form of insurance and there is an expectation to collect far more than what has been paid in premiums. The reality is that a benefit provider will either pre-charge or overcharge in future years in order to collect an amount that is equal to claims paid, plus an administrative charge. In some cases, the benefit provider is not able to collect all claims by way of premium from one employer, so they will over bill other employers. This results in a cost which can come close to $2.00 of premium paid for every $1.00 paid in claims. Much larger companies can reduce these costs by spreading the expenses around amongst a large number of employees, however, they will still not be in a position to receive any more than that which has been paid in premium, plus administrative charges.
By using the CustomCare Plan you are, in fact, obtaining these same benefits by a far more cost effective solution which simply requires a 10% administrative fee. This plan does not require ongoing premium payments and only requires a payment at the time of claim reimbursement.
As an employer can I choose to provide dental benefits or vision care benefits only for my employees?
The program can be customized to meet your individual objectives as an employer. Given the high overall cost of a group dental program, many employers have utilized the CustomCare Plan as a dental only benefit for their employees, in many cases, reducing their overall cost by as much as 70%.
For more information, please contact one of our
Benefits Specialists at (403) 640-6620.
Can my dependents be included on my CustomCare Plan?
The employee's spouse and dependent children may all be included. A dependent child is defined as: " a child 18 years of age and under or 25 years of age and under, if attending a post-secondary institution on a full-time basis."
Must all employees be covered under this Plan and must all employees receive the same benefit amount?
All full time employees must be given the opportunity to participate. An Opt-Out Form is available to those employees not interested in participating.
Each class of employees can be covered for a different benefit amount.
ie. Executives-$10,000/year, Senior Management- $5,000/year, Full Time Staff-$1,000/year (Please call us (403) 640-6620, for clarification on suitable benefit amounts for your company.)
Can you carry forward the unused portion of the benefit amounts?
The option is available to carry forward unused benefit amounts to a maximum of one year.
After CustomCare (CustomCare Inc.) has received my claim, how soon can I expect reimbursement?
Our goal is to have a reimbursement cheque in your employees hands no later than 10 business days from the time your claim is received.
Can I set this plan up as a sole proprietor?
Yes, there are certain limitations for self employed individuals. $1,500 per adult, $750 per child. As well, it is mandatory that travel and Catastrophic Coverage be taken.
If my company is registered in the province of Quebec, can I register for the CustomCare Plan?
At this time NO, due to provincial regulations.
Do I receive a contract/agreement?
CustomCare Inc creates a personalized agreement which outlines the structure of your CustomCare Plan, qualifying medical expenses, plan details, and benefit amounts.
What expenses are deductible?
The CCRA allows all expenses which normally qualify as a medical expense under the relevant provisions of the Act. For more information please see Qualifying Medical Expenses.
Can I deduct expenses already paid this year?
You can only deduct expenses from the month that the CustomCare plan was registered forward. For example: if you registered with CustomCare on May 15th, you can expense claims back to May 1st.
If I travel out of the country to the United States or elsewhere can I deduct medical expenses incurred while outside the country?
We can and do cover all eligible expenses regardless of where they are performed, provided a licensed practitioner provides or refers you to the product or service. If one of our clients is traveling and requires medical/dental attention, they can get what they need, pay for it, retain the receipt and once they are home, send payment from their company with the claim form and receipt(s) and we will reimburse them personally.
* See also Travel & Castastrophic Coverage
Can I expense Provincial Health Care Premiums through my Plan?
Provincial Health Care Premiums can not be expensed through your CustomCare Plan.
How much does the CustomCare Plan cost?
You pay a one time set-up fee of $295.00 (includes no initial charge for employees). You pay only for the services used by yourself, your family or your employees. There are no monthly premiums. If you do not have medical expenses, there is no cost to you. A 10% tax deductible administration fee is applied to each claim processed through CustomCare Inc.
Is the set-up fee tax deductible?
The initial set-up fee is 100% tax deductible to your corporation.
What are the annual/monthly premiums?
The CustomCare Plan is a pay as you go program.
No premiums are required.
Am I not eligible for a tax credit on medical expenses relative to my income?
Medical expenses over a certain threshold entitle you to a tax credit. In 2007 the threshold was 3% of net income or, if your income exceeds $62,833, a flat $1,885.00. All qualifying medical expenses above this amount give rise to a 15.25% federal credit. For example if your net income is $30,000 and you spend $1,500 on qualifying medical expenses you would receive a federal tax credit of $92 ( first 3% or $900 not eligible minus $1,500 expense is $600 with federal tax credit of 15.25% is $92).
Am I required to pay GST/HST?
You are required to pay all Provincial taxes and levies. GST/HST is required on the 10% Administration Fee only. It is not applied to the overall medical expense.
