Employer Switching to HSA

[Jarlaxle]

Originally Posted By: gathermewool
Being young and healthy I opted for the high-deductible plan w/ HSA a few years ago. Fortunately/unfortunately, I ended up in the hospital for a week after emergency surgery. I say fortunately, because unlike a med savings account, the money builds up as you contribute, so when I went to the ER in late August, I had already built up enough to nearly cover my deductible.

Thinking I might have more complications I switched back to the low-deductible plan, but didn't end up going to the Dr. more than a couple of times for routine stuff.

Last year and this year I'm back on the high-deductible plan. I saved >$2k last year, and have maxed out for this year. If I don't withdraw more than what routine visits require, then my plan is to drop off my contributions to as low as possible.

I may reconsider, and treat this as a quasi-401k. The ROI is terrible if left in the account with a low balance, but there is a limit (I need to look this up, but I think it's $2k,) where they allow you to invest in certain funds vice their standard savings-account interest rate.

Overall, I think it's a decent plan if you don't have tons of expensive medical requirements. Even if something bad happens, the worst you'll be responsible for is the deductible, which shouldn't bankrupt most people if you have any kind of savings. if you have no savings, the choice of a low-deductible plan, and the high-deductible is multi-thousands of dollars, then I'd recommend against this, but it makes sense for many of use youngin's who are relatively healthy.


I wish that was an option for me. It's not...I'm stuck getting reamed for a very expensive health plan, with 90% of the benefits being things I will never even dream of using. I want a high-deductible plan! Basically, all I want is catastrophic-event coverage. I don't need coverage for fertility treatments, Viagra, and massage therapy!

 

[Cujet]

I am 100% convinced that catastrophic coverage is what most people need. Especially when young and working.

My co-worker "Bill" is, in essence, self insured (has extreme coverage only) . He has a practical financial view. His medical expenses vary wildly from year to year. But, over the last 16yrs, he has spent WAY less than me on medical.

As my insurance is now 27K/yr. His max outlay was $25K one year.

He shops for the best cash cost and does VERY WELL with that, as he offers to pay at time of service.

The bottom line is that I have spent well North of 100K more than him. That's MY MONEY I've lost. I FEEL STUPID.

 

[Shannow]

Originally Posted By: Cujet
I am 100% convinced that catastrophic coverage is what most people need. Especially when young and working.


Don't want to go into ObamaCare, nor enter into a weeing match over whose system works...

Here in Oz, if you suffer a catastrophic injury or illness, you will not go broke, you will be treated, by specialists, in major hospitals...heart attack, or appendix, you will get treated, without a bill. They will try to get you to quote your compulsory private insurance (extra 1.5% tax and premiums rise by 2% p.a. that you don't have it makes it compulsory) which will result in a bill (gap).

If it's non immediately life threatening, then you wait on he public system (for a looonggg time), or convince your private insurer that it's worthy, or pay your way

Silly anecdotes...
Two engineers (brothers) that I worked with both had heart problems in the same year requiring bypass surgery. One went public, one went private. Both treated in same hospital, same specialist, one had a bill, the other didn't. The guy who went with his insurance had a co-pay. However, his insurance also paid for his rehab works, the other guy had to pay, or not go.

Sister had a procedure as a kid due to her spina bifida. Entirely necessary, parents paid nothing at the time. 35 years later, the procedure needed revising, as prophylactic urine bags leaking in the middle of business meetings was impacting here career. Public system said no way, procedure is still functioning, and it's not life threatening. Private system declared it pre-existing,so she was on her own.

 

[Spector]

You realize that your contributions to the HSA are pre tax which is a slight benefit. I have had HSAa but I had to fund them and get the tax refund on the return, it was not an employer sponsored HSA.

HSAs will never take the place of a good coverage policy, they stink like 401Ks are supposed to be in lieu of pension plans, neither one will do the job unfortunately.

On the other side, if you have group coverage it is usually a far better cry then trying to find ins yourself, with any pre existing condition well, forget it.

A couple of years ago we were paying 1,900/month for a high ded policy due to pre existing conditions and no group coverage, and LUCKY TO GET IT. it is a tough world out there in health ins

 

[GMFan]

Originally Posted By: mechanicx
I think an HSA would be all right as long as your employer is giving you the equivalent benefit value of the previous plan. I'm all for people holding their benefit money and hand and seeing it actually being spent and maybe being more responsible with it.

Although, I'm betting the $1200 is not equivalent and constitutes a benefit cut and most of the savings is realized by the employer with higher healthcare expendentures borne by the employee.


When we had the staff meeting my employer explained that this change was to offset any increases in costs for them and also a plan to make it a bit cheaper for us. I am one of the younger guys (25 years old) in the office who use the provided health insurance and the older workers are on a spouse's so I guess they thought this plan made most sense for those using it.

If health insurance keeps going up I bet a lot of companies will either stop contributing, contribute very little or lay-off employees. My employer has made it clear that with all the new taxes on small business and rising insurance rates things were going to be changing. This was the first change.

 

[opus1]

Personally, I think a lot of companies are going to do the math and decide it's cheaper to pay the government a penalty and drop health coverage and tell their employees to go to whatever exchanges are set up. This would eliminate operating costs for the insurance, plus free up HR resources that have to deal with insurance company issues.

 

[Shannow]

Given that health insurance provision was one of the ways to compensate employees without the tax man getting involved, and forced down wages, I think Americans need to get their wages back, and force the insurance industry to compete.

There's a lot of you, and your costs in other areas indicate that competition is keeping everything but health at reasonable levels.

Don't know what the tipping point is, but 25M people in Oz seems inadequate to provide a reasonable insurance pool...300M should be.

 

[The Critic]

Originally Posted By: JHZR2
The thing is if one goes for a low deductible, traditional plan, the cost is much higher, and there still is a copay and possibly some deductible. A perpetual deductible hitter, year after year may be out some more dollars, but I'm not seeing how it becomes a giant amount either really.

Remember that in one year, the delta for the plan is already possibly $2600 or more, less than the traditional. Add the $1200 return of premium, and you already have the $3800 to cover deductible right there.

I went to a chiropractor for a time, and he gave me a self-pay price. It was $35/visit iirc. I was ok with that, paid it with hsa pre-tax money and all was well. One of the tenets of hdhps are that people shop and try to get a beneficial deal. It's not like regular plans don't have limits on stuff like chiro and pt...


I have a traditional low-deductible "premium" PPO plan thru BCBS and I think it costs me about $200/mo. IIRC, the high-deductible plan was about 30% cheaper, but was not cheap enough for me to seriously consider switching to it.

Originally Posted By: Shannow
I agree a lot with what JHZR2 says regarding insurance.

Just got a letter from my insurer telling me that premiums are going up 10%, cataracts, knees and hips are no longer covered...but take advantage of our new benefits that include gym shoes, sunglasses with purchase of prescription glasses.

Insurance doesn't need to cover shoes and glasses...

There was an article about this in insurance journal recently. The purpose of those benefits is to promote alternative healing methods. I'll see if I can find the link to the article and post it in this thread.

 

[SS1970chrysler]

I don't even have any insurance through work at all.

 

[PandaBear]

Originally Posted By: Shannow
Don't know what the tipping point is, but 25M people in Oz seems inadequate to provide a reasonable insurance pool...300M should be.


Ah, but some of the 300M do not believe in pooling and think people who don't exercise, smoke, eat unhealthy, or have non healthy genes should just go kill themselves.

And they blame one politician (out of the 2 who ran for offices) for it.