Preview of 2018 ACA plans is LIVE

[ivinsfan]

I don't actually qualify for a HSA because my plan's deductible ($7,150) is greater than the allowable maximum of $6,550. I had never really pursued it until now, although I recall being told at some point a few years ago that I wasn't eligible for one.

Sign up for a HSA plan for next year if you can it might help you with cliff issue

 

[bobandsherry]

Wow, not good news for me here in Florida. Even with a big subsidy, my BlueOptions plan is jumping from $424 to $957 and it looks like none of the BCBS plans include my specialist. Sad because I’ve really been happy with BCBS.

Ambetter and Molina are the other two options. Ambetter includes my specialist and I’ll check my other doctors and local hospitals. I need to really examine their plans.

SLCSP for 63-year-old woman in my area, $1037.

I'm in Florida too and noticed similar. Also noticed prescription I take wasn't there. However as this is only a "preview", it could be the full list of doctors and prescriptions is not yet loaded. Might re-check after it goes live.

 

[bobandsherry]

OK, old dog looking to learn new trick. What's a good source to read up on to become knowledgeable on considering HSA plans?

 

[RunningBum]

OK, old dog looking to learn new trick. What's a good source to read up on to become knowledgeable on considering HSA plans?

Do you mean the insurance plan, or where to put HSA money? The insurance part is pretty easy. It almost always has HSA in the title if it is HSA eligible. It always has HSA yes/no in the details, as far as I've seen. If you wonder what makes it eligible, google for the requirements. The main thing is there are min and mix limits for deductibles and OOP max. It's intended for high deductible plans, but some plans have too high of limits and aren't eligible.

 

[ShokWaveRider]

Your agent finally has the correct info - you should see little change (either premium or coverage) with CSR'd Silver plans.

I don't go through an agent for enrollment, healthcare.gov has been working for us the last couple of years.

The agents prices are the same a HC.gov. I always double check them. She uses an agent portal though and seems to get more info on the CSR's than I get when I look. So to me it is a no brainer to let her do it.

 

[bobandsherry]

Do you mean the insurance plan, or where to put HSA money? The insurance part is pretty easy. It almost always has HSA in the title if it is HSA eligible. It always has HSA yes/no in the details, as far as I've seen. If you wonder what makes it eligible, google for the requirements. The main thing is there are min and mix limits for deductibles and OOP max. It's intended for high deductible plans, but some plans have too high of limits and aren't eligible.

I am wanting to get better understanding of benefits of HSA plan vs non-HSA (such as Silver plan). I see there is HSA bronze plan ($6,000 ded) with my insurer that's basically no cost versus $500 for silver plan ($600 ded). Is there a reason I would choose HSA plan and the tax benefits and consequences.

 

[RunningBum]

I am wanting to get better understanding of benefits of HSA plan vs non-HSA (such as Silver plan). I see there is HSA bronze plan ($6,000 ded) with my insurer that's basically no cost versus $500 for silver plan ($600 ded). Is there a reason I would choose HSA plan and the tax benefits and consequences.

An HSA contribution is deductible, just like a tIRA contribution, and you don't need any wage income to contribute. You just need an HSA eligible plan. So you've got that benefit of a tax deduction, lowering your tax bill or giving you more room for tIRA conversions or taking 0% LTCGs, if you do that.

But it's better than a tIRA, because withdrawals from it can be tax free if you use them for eligible medical expenses, provided you don't also use them as a schedule A deduction. So you could take the deduction, and as you incur medical expenses, withdraw tax free to pay them. Or, you could put the receipts in a shoebox and let the account grow tax free, and withdraw whenever you want against eligible expenses. It's not a "use it this year or lose it" benefit like a FSA. I literally put the receipts in a shoebox, after coding each one ("2017-1" for my first expense of this year, "2017-02" for the second, etc) and making an entry on a spreadsheet for each expense.

If you need access to the money in the account without enough eligible expenses, you can still withdraw after age 65 like a tIRA, paying taxes on the withdrawal. That's not as good of a use of the account, but at least you can get to your money without penalty.

So an HSA is a lot like a tIRA going in, and a Roth coming out. Best of both worlds. The biggest disadvantage I see is that HSA custodians with charge fairly high fees, or give low returns. There are a couple threads around on the best choices. The basic strategy is to try to find a low or no cost custodian--perhaps your local credit union-- and then when the account grows enough to be worthwhile, pay the fees to have access to better investments.

 

[RunningBum]

Of course if you don't like high deductibles, a silver or gold plan is probably more for you, but those come at a high premium cost. For me, I'd probably only get a silver if I was eligible for cost sharing.

 

[MichaelB]

I am wanting to get better understanding of benefits of HSA plan vs non-HSA (such as Silver plan). I see there is HSA bronze plan ($6,000 ded) with my insurer that's basically no cost versus $500 for silver plan ($600 ded). Is there a reason I would choose HSA plan and the tax benefits and consequences.

Of course if you don't like high deductibles, a silver or gold plan is probably more for you, but those come at a high premium cost. For me, I'd probably only get a silver if I was eligible for cost sharing.

This is a useful spreadsheet to compare total health care spending for different combinations of premium, deductible and other cost sharing, and health care costs. http://www.early-retirement.org/for...nd-coinsurance-copay-68965-3.html#post1374536

 

[RunningBum]

This is a useful spreadsheet to compare total health care spending for different combinations of premium, deductible and other cost sharing, and health care costs. http://www.early-retirement.org/for...nd-coinsurance-copay-68965-3.html#post1374536

healthcare.gov also has a cost calculator for comparing plans. You click the box "estimate total yearly costs" and select low, medium, or high usage, and it shows the total estimated costs (premiums, deductible, co-pays, etc) for each plan. I don't know exactly what they consider each of those categories of usage, so a spreadsheet would be a lot more customizable, but you can get a reasonable idea.

 

[bobandsherry]

Of course if you don't like high deductibles, a silver or gold plan is probably more for you, but those come at a high premium cost. For me, I'd probably only get a silver if I was eligible for cost sharing.

I can manage my MAGI, either pulling from after tax money or pre-tax money as necessary. So it comes down to looking at long term benefits.

This is a useful spreadsheet to compare total health care spending for different combinations of premium, deductible and other cost sharing, and health care costs. http://www.early-retirement.org/for...nd-coinsurance-copay-68965-3.html#post1374536

Sounds like that will be every helpful, thanks!

 

[Sue J]

OK, old dog looking to learn new trick. What's a good source to read up on to become knowledgeable on considering HSA plans?

The main thing to consider is that only HSA Compatible High Deductible Health Plans can be used with an HSA.

The plan will pay nothing until you reach your deductible. Then some plans pay a % until you reach the Max Out Of Pocket. For some HSA HDHP plans the deductible is the same as the MOOP, so when you reach the deductible, the plan pays 100%.

So be prepared to pay all of your medical costs up to the deductible.

Your HSA contribution is tax deductible on page 1 of your Fed 1040 so it reduces your AGI, which can be very handy!

You can use your HSA contribution to pay for your medical expenses, most HSA administrators offer you the option to have access to your contribution with a debit card. Many HSA administrators offer investing options. We use one that offers Vanguard funds.

You can also make a (tax deductible) contribution and then pay for your expenses out of your normal cash flow, let the investments grow tax free (like a Roth IRA) and then reimburse yourself at a later date.

I don't remember where I read the explanation but it was described as Triple Tax benefit -

- Contributions are a tax deduction.
- Contributions grow tax free
- Withdrawls are tax free if used for medical expenses incurred after the HSA is opened.

Hope that helps.

 

[bobandsherry]

The main thing to consider is that only HSA Compatible High Deductible Health Plans can be used with an HSA.

The plan will pay nothing until you reach your deductible. Then some plans pay a % until you reach the Max Out Of Pocket. For some HSA HDHP plans the deductible is the same as the MOOP, so when you reach the deductible, the plan pays 100%.

So be prepared to pay all of your medical costs up to the deductible.

Your HSA contribution is tax deductible on page 1 of your Fed 1040 so it reduces your AGI, which can be very handy!

You can use your HSA contribution to pay for your medical expenses, most HSA administrators offer you the option to have access to your contribution with a debit card. Many HSA administrators offer investing options. We use one that offers Vanguard funds.

You can also make a (tax deductible) contribution and then pay for your expenses out of your normal cash flow, let the investments grow tax free (like a Roth IRA) and then reimburse yourself at a later date.

I don't remember where I read the explanation but it was described as Triple Tax benefit -

- Contributions are a tax deduction.
- Contributions grow tax free
- Withdrawls are tax free if used for medical expenses incurred after the HSA is opened.

Hope that helps.

Thanks for the details in your response. With this being 2nd year retired and dealing with ACA I've learned a lot from people like you in the forum.

My insurance provider (BCBS) offers a plan with HSA option. I'm aware that it pays nothing until deductible ($6K/per person) is met, the only exception are for Preventative prescriptions that it pays in full. I consider one of the benefits of being with insurer is the negotiated rates, even if I pay out of pocket it's at a reduced cost.

I've looked at Bronze Plan with HSA vs Silver Plan, with MAGI of $32K. With CSR and subsidy it looks like this:

Bronze/HSA: $0/yr premium, ded/oop $6K ($12K for couple). So if I understand correctly, worst case total would be the ded/oop of $12K.

Silver Plan: $6,126/yr premium, ded $600 ($1,200 for couple) and OOP of $2,450 ($4,900 for couple). Worst case would be $11,116 (premium + oop).

If I'm understanding correctly then, with worst case there's no much difference in the two.

Looking at a "most probable" case using this year as the proxy for costs paid by insurance and our OOP (co-pays). Co-pays and deductibles are increasing for 2018, so all things being equal for next year I estimate the co-pays for 2018 would be $2K. So, with Silver Plan next year I'd pay $8,126 for the year with premiums and oop costs. With Bronze/HSA it would probably be $12,000. So based on that it looks like Silver plan still wins.

I also looked at what cost would be with MAGI of $64,500. In that case it the Bronze/HSA comes out slightly favorable under my "most probable" basis, especially considering that the HSA contribution would reduce MAGI and "investment" to grow tax free. Worst case would be $14,580 (prem+oop) for Bronze/HSA while the Silver plan would be just over $23,000 (but would reduce taxable income).

Time to update my spreadsheet for HSA comparison to select our 2018 plan option.

 

[bobandsherry]

An HSA contribution is deductible, just like a tIRA contribution, and you don't need any wage income to contribute. You just need an HSA eligible plan. So you've got that benefit of a tax deduction, lowering your tax bill or giving you more room for tIRA conversions or taking 0% LTCGs, if you do that.

But it's better than a tIRA, because withdrawals from it can be tax free if you use them for eligible medical expenses, provided you don't also use them as a schedule A deduction. So you could take the deduction, and as you incur medical expenses, withdraw tax free to pay them. Or, you could put the receipts in a shoebox and let the account grow tax free, and withdraw whenever you want against eligible expenses. It's not a "use it this year or lose it" benefit like a FSA. I literally put the receipts in a shoebox, after coding each one ("2017-1" for my first expense of this year, "2017-02" for the second, etc) and making an entry on a spreadsheet for each expense.

If you need access to the money in the account without enough eligible expenses, you can still withdraw after age 65 like a tIRA, paying taxes on the withdrawal. That's not as good of a use of the account, but at least you can get to your money without penalty.

So an HSA is a lot like a tIRA going in, and a Roth coming out. Best of both worlds. The biggest disadvantage I see is that HSA custodians with charge fairly high fees, or give low returns. There are a couple threads around on the best choices. The basic strategy is to try to find a low or no cost custodian--perhaps your local credit union-- and then when the account grows enough to be worthwhile, pay the fees to have access to better investments.

Thanks, very helpful. Regarding HSA contribution and direct payment of medical expenses - I get that the HSA contribution then is reflected on Page 1 of 1040 and reduces the MAGI. If I pay the medical expenses out of my pocket and don't submit for reimbursement am I entitled to including them as Schedule A deduction (above 10% limit) in the current year (allowing the HSA balance to grow and be available for expense reimbursement at a later date)?

 

[ivinsfan]

Thanks for the details in your response. With this being 2nd year retired and dealing with ACA I've learned a lot from people like you in the forum.

My insurance provider (BCBS) offers a plan with HSA option. I'm aware that it pays nothing until deductible ($6K/per person) is met, the only exception are for Preventative prescriptions that it pays in full. I consider one of the benefits of being with insurer is the negotiated rates, even if I pay out of pocket it's at a reduced cost.

I've looked at Bronze Plan with HSA vs Silver Plan, with MAGI of $32K. With CSR and subsidy it looks like this:

Bronze/HSA: $0/yr premium, ded/oop $6K ($12K for couple). So if I understand correctly, worst case total would be the ded/oop of $12K.

Silver Plan: $6,126/yr premium, ded $600 ($1,200 for couple) and OOP of $2,450 ($4,900 for couple). Worst case would be $11,116 (premium + oop).

If I'm understanding correctly then, with worst case there's no much difference in the two.

Looking at a "most probable" case using this year as the proxy for costs paid by insurance and our OOP (co-pays). Co-pays and deductibles are increasing for 2018, so all things being equal for next year I estimate the co-pays for 2018 would be $2K. So, with Silver Plan next year I'd pay $8,126 for the year with premiums and oop costs. With Bronze/HSA it would probably be $12,000. So based on that it looks like Silver plan still wins.

I also looked at what cost would be with MAGI of $64,500. In that case it the Bronze/HSA comes out slightly favorable under my "most probable" basis, especially considering that the HSA contribution would reduce MAGI and "investment" to grow tax free. Worst case would be $14,580 (prem+oop) for Bronze/HSA while the Silver plan would be just over $23,000 (but would reduce taxable income).

Time to update my spreadsheet for HSA comparison to select our 2018 plan option.

I have to question that silver price.Those numbers seem off for a plan with a subsided deductible.with a 32000 income that plan shouldn't cost you more then 250-300 bucks a month or there should be some sliver plan available for that number..BCBS might be overpriced.

 

[bobandsherry]

I have to question that silver price.Those numbers seem off for a plan with a subsided deductible.with a 32000 income that plan shouldn't cost you more then 250-300 bucks a month or there should be some sliver plan available for that number..BCBS might be overpriced.

You are correct. I had been looking at the SLCSP (it's plan we had this year). There is one lower priced Silver plan, it has $0 ded and $2,450 OOP. With $32K MAGI the premium is $364/mo after subsidy ($4,368/yr). It does have higher co-pays.

This year was our first year retired on ACA so I data points that I can use to better guesstimate what our medical and prescription needs would be for 2018. My review this year is seeing which of the plans would be lowest priced option for us and I'll include a bronze (without HSA) and now a bronze/HSA in my review.

Thanks for raising the question.

 

[RunningBum]

Thanks, very helpful. Regarding HSA contribution and direct payment of medical expenses - I get that the HSA contribution then is reflected on Page 1 of 1040 and reduces the MAGI. If I pay the medical expenses out of my pocket and don't submit for reimbursement am I entitled to including them as Schedule A deduction (above 10% limit) in the current year (allowing the HSA balance to grow and be available for expense reimbursement at a later date)?

Yes, but apparently you can't use any of what you put on line 1 of Schedule A (total amount of medical expenses, not just those over 10%) for reimbursement from the HSA later.

 

[RunningBum]

Thanks for the details in your response. With this being 2nd year retired and dealing with ACA I've learned a lot from people like you in the forum.

My insurance provider (BCBS) offers a plan with HSA option. I'm aware that it pays nothing until deductible ($6K/per person) is met, the only exception are for Preventative prescriptions that it pays in full. I consider one of the benefits of being with insurer is the negotiated rates, even if I pay out of pocket it's at a reduced cost.

I've looked at Bronze Plan with HSA vs Silver Plan, with MAGI of $32K. With CSR and subsidy it looks like this:

Bronze/HSA: $0/yr premium, ded/oop $6K ($12K for couple). So if I understand correctly, worst case total would be the ded/oop of $12K.

Silver Plan: $6,126/yr premium, ded $600 ($1,200 for couple) and OOP of $2,450 ($4,900 for couple). Worst case would be $11,116 (premium + oop).

If I'm understanding correctly then, with worst case there's no much difference in the two.

Looking at a "most probable" case using this year as the proxy for costs paid by insurance and our OOP (co-pays). Co-pays and deductibles are increasing for 2018, so all things being equal for next year I estimate the co-pays for 2018 would be $2K. So, with Silver Plan next year I'd pay $8,126 for the year with premiums and oop costs. With Bronze/HSA it would probably be $12,000. So based on that it looks like Silver plan still wins.

I also looked at what cost would be with MAGI of $64,500. In that case it the Bronze/HSA comes out slightly favorable under my "most probable" basis, especially considering that the HSA contribution would reduce MAGI and "investment" to grow tax free. Worst case would be $14,580 (prem+oop) for Bronze/HSA while the Silver plan would be just over $23,000 (but would reduce taxable income).

Time to update my spreadsheet for HSA comparison to select our 2018 plan option.

If your "most probable" case still puts you over the $12K deductible, a lower deductible plan likely makes sense. For me, $2-3K is much more likely, so avoiding a huge premium is a big factor. I'm willing to self insure to a certain point. Any policy will protect me on the high end with a Max OOP limit.

The nice thing about a low deductible is that you're probably more likely to get health care when you aren't sure. With a high deductible, knowing I'll be paying for the whole thing unless I have a bad year, I tend to see if things will get better on their own, while I'm probably better off seeing my doc sooner than later. Then again, I wasn't good about seeing docs even with great insurance from work.

 

[bobandsherry]

Yes, but apparently you can't use any of what you put on line 1 of Schedule A (total amount of medical expenses, not just those over 10%) for reimbursement from the HSA later.

Yep, I was anticipating that. I'm not expert on HSA but trying to get educated this year and considering it into my health care option for 2018. I was thinking there may be a benefit by using that to lower the MAGI and increasing the subsidy. Additionally I would pull money from 401K and invest into funds, so doesn't take my money out of the market but would help lower my RMD later in life and that would have benefit with SS and taxes. Or perhaps as I spend time analyzing further it really doesn't make sense. Thanks for comments.

 

[ivinsfan]

Yep, I was anticipating that. I'm not expert on HSA but trying to get educated this year and considering it into my health care option for 2018. I was thinking there may be a benefit by using that to lower the MAGI and increasing the subsidy. Additionally I would pull money from 401K and invest into funds, so doesn't take my money out of the market but would help lower my RMD later in life and that would have benefit with SS and taxes. Or perhaps as I spend time analyzing further it really doesn't make sense. Thanks for comments.

At the income level 32 if you go much lower you'll end up on Medicare. One question about your bronze have you maxed out your income with a 0 premium be sure you are not leaving some subsidy money on the table.

 

[bobandsherry]

At the income level 32 if you go much lower you'll end up on Medicare. One question about your bronze have you maxed out your income with a 0 premium be sure you are not leaving some subsidy money on the table.

Between pre-tax and after tax funds to support my spending I will def keep it above at $32K or more

With 0 premium there's about $130 subsidy for the year left on the table. I don't look to leave anything there if I go with Bronze/HSA as I'll take opportunity to move more from my 401K to fund the HSA and also transfer into my post tax investments. RMD is a while away, but thinking it's I better get a long term plan in place to minimize that impact.

 

[RunningBum]

Between pre-tax and after tax funds to support my spending I will def keep it above at $32K or more

With 0 premium there's about $130 subsidy for the year left on the table. I don't look to leave anything there if I go with Bronze/HSA as I'll take opportunity to move more from my 401K to fund the HSA and also transfer into my post tax investments. RMD is a while away, but thinking it's I better get a long term plan in place to minimize that impact.

Rather than transfer into post tax for investments, why not transfer it into a Roth? Unless you need to access it in the next 5 years.

 

[bobandsherry]

Rather than transfer into post tax for investments, why not transfer it into a Roth? Unless you need to access it in the next 5 years.

I consider a Roth a post tax investment. But you do highlight a good point for clarification on investment option with tax benefits.

 

[bobandsherry]

If your "most probable" case still puts you over the $12K deductible, a lower deductible plan likely makes sense. For me, $2-3K is much more likely, so avoiding a huge premium is a big factor. I'm willing to self insure to a certain point. Any policy will protect me on the high end with a Max OOP limit.

I had to rethink my "most probable". As I looked at what insurance paid this year there were expenses that were prevention (colonoscopy) and won't be needing again for many years, this would also be covered if it was. I have to go through and tag my claims for this year as to what expenses are "prevention" and still be covered in full, that will lower my "most probable" co-pay/coinsurance expenses.

 

[jetpack]

ZERO HSA PLANS in my area (PA) Very annoying.

Deductible and premiums have jumped for the 5th straight year.
Now at almost 600% of what I was paying pre obamacare.