ACA Plans- Help Me Decide

[zinger1457]

I'll try and keep this simple and not include all the details but I'm deciding between two ACA HDHP plans, one of them is HSA eligible (and more expensive). If I select the HSA plan at the end of the year I'll have deposited ~$4300 in my HSA account. If I select the non-HSA plan my income (after taxes) for the year will be ~$4300 more than it would be for the HSA plan. Basically the cheaper non-HSA plan offsets the tax savings and additional subsidies that I would get from the HSA plan. Disregarding any differences in the health plan benefits which way would you go from an investment/savings stand point?

 

[heeyy_joe]

Since the answer is not clear to you, I would suggest you not ignore the differences between the plan benefits, as this should be your critical decision making path.

 

[MichaelB]

If both plans are ACA compliant the benefits should be the same. The actuarial value to cost rules are also the same, so the price difference means there is a different network of doctors and hospitals, or different cost sharing structure (deductible, copay, total out of pocket).

Can you share with us the cost sharing details of each plan?

 

[pb4uski]

I ran into the same dilemma in choosing between a HSA-eligible bronze plan and a catastrophic plan that is not HSA eligible. The deductibles/copays of the bronze plan were slightly lower that the cat plan but the reality is we consume very little medical care since we are luckily healthy so that isn't realistically a big difference to us. However the cat plan premium was 38% lower ($250/month). I decided that the benefit of being able to contribute to an HSA was not worth paying an additional $250/month in premium (for two of us).

To me, it becomes a judgement call of how much you are willing to pay to be able to make HSA contributions.

 

[sengsational]

If I read your OP correctly, it's a wash in the near term (i.e. the plan year). Forgetting all of the differences in the plan benefits, network, etc, I'd say if expand your timeframe, and you're not "too old", then you'll pick the HSA. I presume you were not born in 1457

Given that, unless you die very suddenly, you'll almost certainly have medical expenses as you age. Even if you're on Medicare, there's a lot of out of pocket. If you are "young enough", say 55, you'll have time for that account to compound tax-free. Of course you wouldn't spend out of the HSA at all until after it compounded. This makes the HSA almost like a "super-Roth" because not only will you not pay taxes on the money going in, but you also won't pay taxes when it comes out.

PS: Look for a spreadsheet posted in another thread "Compare Health Insurance Options Model.xls"

 

[zinger1457]

If both plans are ACA compliant the benefits should be the same. The actuarial value to cost rules are also the same, so the price difference means there is a different network of doctors and hospitals, or different cost sharing structure (deductible, copay, total out of pocket).

Can you share with us the cost sharing details of each plan?

The non-HSA plan has a $6400/$6600 deductible/out of pocket with co-pays until the OOP is reached, the HSA plan is $6300/$6300. My current doctor is available in either plan. I don't think I've ever paid more than $100 into my deductible and (knock on wood) not planning to pay more than that in the near future.

 

[zinger1457]

Given that, unless you die very suddenly, you'll almost certainly have medical expenses as you age. Even if you're on Medicare, there's a lot of out of pocket. If you are "young enough", say 55, you'll have time for that account to compound tax-free. Of course you wouldn't spend out of the HSA at all until after it compounded. This makes the HSA almost like a "super-Roth" because not only will you not pay taxes on the money going in, but you also won't pay taxes when it comes out.

I'm 57 now and I've had a private HSA plan for the past 8 years and have a decent amount saved up in it. Got the cancellation notice from the insurance company this year, that's why I'm looking at ACA plans. Although I haven't had to dip into my HSA yet I'm sure the day will come when that will happen, probably does make sense to continue adding to it.

 

[pb4uski]

What is the premium difference?

 

[zinger1457]

What is the premium difference?

The HSA plan is about $740/year more including any subsidy received, which is about what I would save on my taxes if I maxed out my HSA contributions.

 

[Mulligan]

The HSA plan is about $740/year more including any subsidy received, which is about what I would save on my taxes if I maxed out my HSA contributions.

Definitely must be a regional issue, as in my area the HSA is the cheapest policy available.


Sent from my iPad using Tapatalk

 

[oscar1]

Does anyone know why HSA plans cost so much more than regular plans with the same exact coverage. I converted to HSA medical plan last year and it struck me as weird that the premiums went from $485/mo to $535/mo (HDHP). Another price increase in July put them at $585 (HDHP/HSA). In October, BCBSTexas announced they were canceling my HDHP. The Healthcare.gov exchange wants $865 for lowest priced Bronze plan but the same plan with HSA is $1,200 per month. WTF?!


Sent from my iPad using Early Retirement Forum

 

[pb4uski]

I wonder if it might be a local thing because in our state the bronze HSA plans are slightly lower than the bronze non-HSA plan, but the monthly premiums for one person are all within $50 of each other.

 

[rodi]

The plans in my area had very similar prices between the HSA and non HSA plans. Obviously higher deductibles for the HSA plans - but not that much bigger.