High deductible medical plan HDHP

[wanaberetiree]

I am still working and need to enroll in 2024 medical plan.

My PPO cost $375x2 / month
HDHP $235x2 / month

I have never used HDHP in conjunction with HSA and wonder if somebody can share personal experience and pluses and minuses from medical and financial standpoints?

TIA

 

[MichaelB]

The HSA has financial advantages. Much like an IRA, you can reduce your taxable income by $4150 / $8300, with another $1000 if you are over age 55. This is especially useful when you don’t (or can’t) deduct your medical expenses. The HSA contributions can be used to pay for medical expenses or they can be invested and grow like an IRA.

The downside is with a high deductible plan you must pay “first dollar”, meaning the plan doesn’t pay until you’ve first met your deductible.

Here’s an Excel spreadsheet that lets you compare the total cost of different plans, including premiums and all cost sharing, based on different levels of use (here)

 

[cathy63]

Will your employer make any contributions to the HSA? If so, that's free money that should be factored into your decision.

 

[HawkeyeNFO]

What is a "high delectable?" Sounds like an edible THC candy or gummy. Can you buy those with your HSA funds now?

 

[Exchme]

It depends on the plans. We use an HDHP with HSA but it has all our doctors, so no problem there. The drug formulary is good enough. The copay's are in the OK range.

The premium difference for us was enough that the HDHP would never lose, if you didn't need much, you pocketed the premium savings, if you needed a lot, the costs were about the same. Meanwhile the HSA reduced your taxable income.

You have to work through the pros and cons for your specific plan offerings, talk to other employees and see what they are doing and why, etc.

 

[braumeister]

Thread moved to better forum for more visibility.

 

[Kings over Queens]

I wouldn't do it any other way.

Every time i've run the numbers the high deductible plan generated premium savings, even when you calculate co-pays and total out of pocket exposure, should you have a bad run.

The doctors and coverage are essentially the same as a typical PPO type plan, granted, deductible's are different, co-pays are different, coinsurance is different, but you still get your annual preventative exams, mamo's, etc.

The key difference is that you likely save money on premiums and get to invest your deductible dollars yourself.

Like I said, I wouldn't do it any other way, but that's me. You need to run the numbers.

 

[wanaberetiree]

I wouldn't do it any other way.

Every time i've run the numbers the high deductible plan generated premium savings, even when you calculate co-pays and total out of pocket exposure, should you have a bad run.

The doctors and coverage are essentially the same as a typical PPO type plan, granted, deductible's are different, co-pays are different, coinsurance is different, but you still get your annual preventative exams, mamo's, etc.

The key difference is that you likely save money on premiums and get to invest your deductible dollars yourself.

Like I said, I wouldn't do it any other way, but that's me. You need to run the numbers.

Thx!

Let me ask you - my deductible for family $6K

I can contribute in 2024 -- $8,300 + $1,000

If I hit $6K then the difference stays in my HSA account like 410K?

 

[Kings over Queens]

If I hit $6K then the difference stays in my HSA account like 410K?

Yes, assuming you use your HSA to pay medical expenses today. I don't.

I've been funding the HSA in full and paying medical expenses out of pocket. My rational is that the money can grow in the HSA tax free and be used when I really need it.

But to your point, yes, that's how it works.

Fidelity has a good no fee account. I was with Health Equity, but they require $500 cash balance, and they charge fees on the funds invested. So I recently moved to fidelity.

 

[wanaberetiree]

My employer uses Fido as benefit administrator
So HSA is at Fido