Millcreek: HSA?

[AZRedhawk44]

Hey, Millcreek and other health care folks:

It's open enrollment times (yay!  HR bureaucrats get to feel important!) and I have a choice between 3 different health plans right now at work.

Two are traditional plans... one is a low-benefit (but low employee payroll deduction... $30 bi-weekly) and one is a high-benefit (but about $100/mo more payroll deduction... $115 bi-weekly) plan.

The last one is an HSA.

The HSA has an in-network max deductible for single folks of $2500 per calendar year, and an annual out of pocket max of $5000.  The bi-weekly cost to me to join this plan is $5.  Practically nothing.  I basically put what I might pay for health insurance into my HSA account (which I then own permanently).  My employer will provide partial matching of my HSA contributions.

On the HSA plan, preventative care office visits are 100% covered.  Primary care and specialist concerns are 100% covered after the $2500/yr deductible is met.  ER/Ambulance/Hospitalization is 100% covered after the deductible is met.  Rx's have reasonable co-pays and that's it.

<knocks on wood> I don't see doctors often.</knock>  Very, very rare.

I'm thinking of going on the HSA, paying the silly $5 token payment for the insurance, and putting $100 per paycheck into the HSA for the next two years.  Once I have $5000 or so in it, trickle the contributions back to $25-50 a paycheck or whatever seems appropriate at the time.  I basically get health insurance for very minimal or no cost, once I have the HSA account populated with $5000.

Drawbacks:  This plan only has a 50% coverage for out-of-network services (except ER and Ambulance, which are still 100% covered after deductible).  Hospitalization is 50% after deductible for out of network hospitals.  Max out-of-pocket annual cost is unlimited with out-of-network services. 


With the cost being relatively the same between the high-benefit normal plan and the HSA plan, the big differences I see are:
Hi-ben out of network coverage is 70% after a $600 deductible.
HSA out of network coverage is 50% after a $2500 deductible.

Hi-ben in network hospitalization is 90% after $600 deductible.
HSA in network hospitalization is 100% after $2500 deductible.

Hi-ben in network ER is $100 copay + 90% after $600 deductible.
HSA in network ER is 100% after $2500 deductible.

A $25,000 out of network hospitalization will cost me $7320 on the hi-ben plan, from my post-tax pocketbook.
A $25,000 out of network hospitalization will cost me $11,250 on the HSA plan, paid as much as possible from my HSA and the rest from my post-tax pocketbook.

A $25,000 in network hospitalization will cost me $2440 on the hi-ben plan (paid from my post-tax pocketbook).
A $25,000 in network hospitalization will cost me $2500 on the HSA plan (paid from my HSA, not my post-tax pocketbook).


Looks like a smart decision, to me.  Worst case scenario is obviously out-of-network hospitalization.  How common is it for a hospital stay to be "out of network" of a major insurer fee schedule such as Aetna?

[Scout26]

<<<<---Learned about healthcare and insurance the hard way.


Since you are young and healthy, the answer to that question is "How much do you travel?" and is "your" hospital (closest to your house/work) in network?

As long as the Hospital the ambulance will take you to is in-network, then I wouldn't worry about it.

Make sure whatever healthcare providers you currently use are also in network.

[Kingcreek]

Does the plan differentiate between an emergency hospitalization and routine?
An HSA is the way to go for most healthy wage earners as long as you load it sensibly. If its a major carrier almost any hospital will be in network.

[AZRedhawk44]

Since you are young and healthy, the answer to that question is "How much do you travel?" and is "your" hospital (closest to your house/work) in network?

I'm planning a 49 State, 4-6 week motorcycle trip in May of 2013.

[AZRedhawk44]

Does the plan differentiate between an emergency hospitalization and routine?

No.

And there is no such thing as an "out of network" ER.  That's 100% after deductible.

[MillCreek]

A HSA is generally only offered in concert with a high-deductible health plan.  They are generally two different things.  Is the deductible and coverage you are describing actually being offered through a high-deductible health insurance plan?

[AZRedhawk44]

Yep.  HDHP.

[MillCreek]

In that case, for young, healthy people whose local facilities are in the network, I think a high-deductible plan with a HSA makes a heck of a lot of sense.  The contributions to the HSA roll over from year to year, so it is not spend it or lose it, as with a flexible savings account.  The contributions to the HSA are usually tax-sheltered as well.

[Marnoot]

I do a HDHP for me and mine. With the premium, deductible, and employer HSA contribution associated with it at my employer, I've been unable to calculate a scenario whether the higher benefit/higher premium plan would make more sense financially, so long as I contribute enough to the HSA.

That could certainly change if with premium or deductible increases, or employer contribution change, however generally if the premium and deductible are going up on the HDHP plan, they'll go up on the higher-premium plans too, leaving the HDHP as the more attractive option.

One thing to keep in mind, you will feel as though you're paying a lot more money for healthcare on a high deductible plan since it's all coming out of your pocket instead of off the top of your paycheck. Just remember that you're actually saving money. Also more incentive to explore/discuss cheaper meds, procedures, etc., with your doctor/pharmacist, as money saved on such is money in your pocket with a high-deductible plan.

[mtnbkr]

As a young, healthy, and single person, I'd do it.  As a middle-aged husband and father of two children, no effing way.

For example, this year we had a broken arm, tonsillectomy, physicals, and other procedures.  It was probably one of the more expensive years medically than any other except for the birth of my 2nd child.

Chris

[K Frame]

My company is moving to options like that.

Thanks, Obamacare. 

At least my deductible will be $1,500, not something freaking obscene.

The biggest problem is that gap period between when you start your insurance and you get some money built up.

[Marnoot]

As a young, healthy, and single person, I'd do it.  As a middle-aged husband and father of two children, no effing way.

For example, this year we had a broken arm, tonsillectomy, physicals, and other procedures.  It was probably one of the more expensive years medically than any other except for the birth of my 2nd child.

Chris

It's always worth doing the math. As I said whether it makes sense certainly varies by the details of your employers offerings, but in my case the HDHP saves me money regardless of whether we didn't see a doctor once, or whether me, my wife, and my son had multiple hospitalizations, procedures and expensive name-brand meds each (due to the lower out-of-pocket max on the HDHP).