HAH, Savings account health scam what a joke.

The BBQ Pit
1

Just today I found that I’m going to have to give up my Blue Cross Blue Shield. Now I’m going to have to join our sister companies “savings account” health scam. Its going to cost me more and its going to cost the owner $125 more a month to insure me, than its costing him now. That doesn’t include the $500 jumper he gives us for our “accounts”.

What a wonderful solution, take more money out of the small business owner’s pocket, take more money out of the worker’s pocket, make people scared to go to the doctor since it costs so damn much, and put more money in the pockets of the ineffectual management of an insurance company.

Should I have expected anything less?

2

I work in benefits health systems and your post doesn’t make a lot of sense. Why would the owner not have any control over what health plan is available to the company especially if the new, lesser option costs more?

Small companies have a range of providers to choose from. I suspect the owner is distorting the story.

3

Moving thread from IMHO to The BBQ Pit.

4

You have no idea how a health savings account works, do you?

5

SHAGNASTY, The owner is a die hard Bush supporter and since the first time Bush said “savings account health plan”, he figured that was the way to go, why would the monkey steer him wrong? He pushed the one company that way, and it cost him more, cost the employees more, but the Leader said it was good, so thats the way it went.

This morning, the book keeper/ accountant/ Hr person/ anything to do with numbers guy(for both companies) was showing me the letter that the company I work for was no longer eligable for BCBS coverage. Also this morning the Accountant received a letter that the “savings account health scam” coverage was going up, by a tiny little bit of 35%, you know, inflation and all, insurance must outpace gas prices by at least six thousand percent.

The screwed up thing is the owner was paying over $100 more a month for the single employees in the other company, than he was paying for the people in the company I work for. They had to pay 2k out of their “savings account” before they saw any compensation. I on the other hand, was saving the owner $100 a month, plus the $500 startup, and can go to the doctor for $5, plus I can get a new heart and lungs for only a hundred bucks(who knows when your going to need those). Why would I want to give that up. could it be because the glorious leader suggested it??? possibly.

I still see it as a scam to land more money in the hands of the insurance companies and less in the hands of the poor working schmoes like myself.

6

Why don’t you enlighten him, then, instead of being a prick about it?

7

Actually Dave(I hope that is your real name), you could actually explain it to me, the insurance salesmen try to make it seem so wonderful, yet it seems to cost so much more. I can understand if I never go the doctor, I’m golden, but what happens if I need heart surgery? or some expensive meds like my mom does(MS and all)?

So lets say, I have a heart attack and need bypass surgery. There goes my $2000 upfront money from my account. It was pretax, so thats nice, but now my surgery costs $100,000 (I’m just guessing), so now I have to pay 10% of the other 98,000 dollars? So now I owe $9800 dollars, thats the price of a nice used car. That kind of sucks, since now, my employer has paid more, I’ve put in more and now I owe $9800 fricken dollars. So who just won? not me, not my employer, those poor poor bastards, the insurance company. With my current coverage, $100.

OK now that I’ve just ranted, seriously, I really hope thats not how it works. Seriously Dave, make me think this is good, since I think I’m stuck with it.

8

Well, I know how they work, having had one for four years, and I concur that they suck. We paid $300 and change a month for major medical coverage for two people ($5k deductible) and everything else was out-of-pocket. Yeah, tax free, big whoop. You still have to come up with the scratch, and we never had anywhere near that $5k in the account – just barely enough to cover expected expenses, a few hundred bucks at most. (The only reason we went to the MSA was because Mr. S lost his job and it was all I could get, as a self-employed person, that we could afford.) You don’t go for any preventive care or “hey, I should get this checked out” type stuff unless you’re lucky enough to have scraped the cash together. Any surprise illnesses or injuries and you’re screwed. It’s a real joy to have a condition that’s stress-related and have to stress out over whether you can afford to go to the doctor to get it treated. And this was while watching the 2004 debates with W talking about how great HSAs are. I bet he never had to insure his family that way, on his fellow Americans’ average salary.

Thank God Mr. S got a job in a school, where he gets the same gonzo insurance that teachers do. The pay sucks but at least now we have decent coverage again (the value of the insurance alone adds about $6/hour to his pay).

9

Wow, what the hell kind of insurance do you have that pays 100% after a $100 deductible? How much does it cost?

10

I can’t speak for the OP, but that’s about what our current insurance with the school system is (except we have a $200 family deductible and small co-pays for some drugs). The wife of one of Mr. S’s co-workers incurred some humongous medical bills, several hundred thousand dollars, and they paid something like a few hundred bucks out-of-pocket.

I think the state pays 85% and Mr. S pays 15% of the cost. Helluva bennie. Goes a long way toward making up for the snotty teenagers and their shit (sometimes literally) that he deals with every day. (He’s a custodian.)

11

Ugh, I thought I was done for the day, but QED is right, I should explain if I’m going to say something like my last post.

OK, here’s how your typical HSA account works. (From an employer it may be a flex spending account which has some minor differences, but essentially they are the same. You’ve said HSA, and that’s what I’m most familiar with, so that’s what I’ll explain) Understand also that there are going to be differences from plan to plan, I’m talking in general here.

Anyhow, the idea behind an HSA is to bring insurance costs under control by taking health insurance back to what it originally was: Something to prevent a catastrophic loss. (It may help if you think of it as health insurance more like auto insurance; your car insurance doesn’t pay for new tires or oil changes, but it kicks in when you crumple the quarter panel.) To that end, an HSA has a high deductible (which is mandated by the government-without it a plan is not HSA eligible), $2500 for an individual and not more than $5000 for a family. All medical costs over that amount each year are covered by the insurance company. With most HSA plans, the coverage is 100% after deductible, although some may have some type of 90-10, 80-20 split until an out-of-pocket amount is met. Usually, something on the order of $2000 or so.

Out-of-pocket expenses under the deductible amount are the responsibility of the insured. To help provide a fund to cover those costs, a separate health savings account is created. This account is funded with pre-tax money, and the yearly contribution can not exceed the policy’s deductible amount. This is a savings account. It usually generates interest (this varies from bank to bank), and the money in the savings account rolls over from year to year. There is no minimum that the insured is required to place into this account in any given year. The funds in this account can be used for any medical expense. Doctor visits, glasses, dental coverage, prescriptions, durable medical supplies, et cetera.

Ideally under this plan, over the course of one or several years, the insured would build up a balance in the savings account equal to or greater than their yearly deductible and out of pocket maximum, and then they would be able to stop funding the account. This allows them to have enough money earmarked and saved for medical expenses that they could wind up with a half-million-dollar heart bypass surgery, and between the insurance and the money in the savings account, it would be entirely covered. They could then proceed to re-fund their savings account for future medical expenses. If the insured never uses the money in his savings account because s/he never makes any claims, then they can withdrawal that money plus interest down the line (for example at retirement)

That’s the basic idea. The real advantage is that, in general, HSAs are considerably cheaper than traditional health insurance policies. The insurance company is only accepting risk for catastrophic expenses. It doesn’t make sense to me that your new plan would be more expensive than a traditional health insurance policy; likewise, I have never heard of a 90-10 HSA with no out-of-pocket maximum. If that truly is the case, then the plan you are describing is pretty damned poor. I would have you urge your employer to do some shopping around. There are probably better options available out there.
I hope that is pretty clear, if you have any specific questions post them and I’ll do my best to answer, understand that my answers will be general rather than specific because I don’t know the details of the specific policy in question.

12

You may need a better agent. Just for shits and giggles, I plucked a Wisconsin zip code out of thin Google (54494) and ran up a quote on a comprehensive PPO plan designed for the self employed that would cover all of those things, $20 co-pay at the docs, $10 for Rx, $100 for a broken arm at the ER, etc…, including basic accident disability, and I got a rate of $321/month for 2 people 30 years old who don’t smoke(I assumed that two people meant you were childless, I further assumed it was because you were young-the idea of your spouse landing a career job supported that. If you’re both older than this it would obviously be more)

13

Weirddave’s description is pretty much how our plan worked, but I’d like to address one remark:

Yabbut, you’re still going to have the usual expenses that drain the account. “Ideally” and “in practice” are two very different things. Mr. S and I were “lucky” in that we had only one regular prescription (my BCs), no chronic health problems, and no kids. And still we were always draining down what little balance we had to pay for regular stuff like dentist visits (I go every four months because of my gums), eye exams, OB/GYN exams, and of course the occasional kidney stone/dental crown/sprained ankle and other incidental visits and the corresponding scrips. Seemed like that account was always running out of money. Your description makes it sound like you can just keep stuffing money into the account until you get to $5K (or whatever) and then put your feet up. That was definitely not the case. More than once the account was thin because we hadn’t been able to beef it up again, and then BAM something came up that we had to pay for, with no money in the account. THEN we basically had to come up with the money twice: once to pay the bill on the spot, and again to “launder” the money (reimburse ourselves through the account to get the tax break). What a pain.

I don’t know how people with kids, or chronic conditions like diabetes (or worse), or lots of expensive medications can survive on one of these plans.

On preview:

Ages 38 and 50, no kids, nonsmokers, I’m overweight (subtract four years for the time when we were looking for insurance). The question is moot now that Mr. S got a new job (the old job was his career; this job, at about half his former pay, is just to keep us insured, ha).

I didn’t have a lot of time to shop around at the time; we sure as hell weren’t going to be able to afford COBRA, and as I recall we had about a month and a half to find something. I tried the group insurance plans of a few organizations I belonged to, but they were all at least double the cost and not much coverage. The plan we did get was a steal by comparison. Plus we sure didn’t enjoy the reaming of having to write up our medical history from since the dawn of time. When Mr. S got his job, I think they just needed my name and the fact that I was his wife, and boom I was covered.

14

Scarlett, I don’t usually recommend an HSA for people for whom budget is an overriding factor who are looking for insurance to cover the little things, but for people who want to pay for smaller stuff out of pocket in order to pay less in health care premiums, especially if they want to retain their money if no medical expenses present themselves, they can be ideal. (although an HRA will save a married couple more money in a lot of circumstances) It’s important to have an agent who is willing to work with you to determine what’s best for your specific situation, not one who is trying to push a one size fits all policy onto every client. (BTW, just in case you’re curious, I changed the ages and by shit canning the disability, I was still able to keep the policy I was talking about right at $400/month).

15

I don’t think they’re meant for people with chronic conditions or who need regular doctor visits.

My small company (3 people, 1 married) has HSAs for me and my brother (my co-worker). Through our carrier we’re able to also provide a “traditional” plan for my one married w/baby-on-the-way co-worker.

Works out great for us because instead of having to spend $1300/mo for three of us to be on coverage that we’ll never use (two of us are healthy beasts), we spend $700 for the traditional plus two HSAs.

Granted, me and my brother are not getting regular hefty sums put into our accounts, but the company is able to afford putting some cash in there when it can. And whenever one of us goes to the doctor we make sure there’s enough to cover it in the HSA account.

The other co-worker with the traditional account gets everything he needs, and it’s much worth the $500/mo or so we pay for his insurance. His wife was on major meds and now gets her pre-natal care all paid for by insurance. He gets over $500 worth of health care each month, and me and my bro get our exact needs covered (about $100/year in doctor visits and eye exams) and the company doesn’t have to waste money away on insurance we don’t need.

We’ve only had it set up this way for about a year now but it’s worked out well. Sure, it’s a gamble. And I can’t imagine doing it on a larger scale - especially since I am the one who manages it, and my brother can be frank with me and say “hey man drop some cash into my HSA, my ear hurts.” We are banking on the fact that my brother and I are quite healthy. And we know that if we do have an emergency the company is able to beef up the HSA, max it out and get our 90% or whatever coverage after the deductible.

It’s not for everyone. It would be dreadful to be forced in to. But we jumped at the chance to be able to do it - no salesmen or presidents involved.

16

I’m not sure but I think Q.E.D just got owned. ;j

17

Nah, just surprised. Pleasantly so, I might add. Well done, Dave. :slight_smile:

18

And yet a lot of people are finding themselves in that very position. Those people with chronic problems may not be able to find or afford a plan that meets their needs. Right now one of my (self-employed) colleagues on one of my mailing lists is scrambling for coverage because her husband is losing his insurance. So far she has not been able to find anything that they can afford and still keep the family in the ongoing medical care that they need. They are very much at risk of joining the uninsured.

As more and more jobs in this country go down the rathole, the problem is only going to get worse.

19

Well I just got the bomb today. Brand new job, part of my compensation package was to match what my previous employer did on healthcare. My entire family was covered and we had to pay a small deductable. $25 basic, $45 specialist and no more than $30 for prescription. We shake on it.

About a month later we’re hit with the new plan. We now have a $2,500 deductable, before the “policy” kicks in and $150 per month for our share of the burden. Those of us with kids (family plan), have a $4,500 deductable and a $300 per month share.

So I went from paying maybe $1,000 a year to paying over $8,000 a year for healthcare. That wasn’t what I shook on. Now to his credit, he increased my salary the $8,000 to make me “whole” and is paying the first couple of year’s policy to allow the staff time to adjust, and tossing a $1,000 into the account to give them a boost…but it was a big shock to people who were worried that they wouldn’t be able to come up with the $1,500 and some of them won’t have the money.

The thing that bothered me was the insurance guy. He just oozed snake oil. He and owner told stories of calling the hospital collection department and telling them what they were willing to pay…not what they could afford to pay, but what they were gonna pay, cause they know what healthcare REALLY costs and the hospital accepting it…nice if you’re a millioniare or insurance broker…hell I’m still getting bills for $25.00 because they say the previous plan didn’t fully cover my visit.

He spoke of people “owning” their healthcare, of shopping for the best deal, because now they had to pay for it. No offense pal, but part of my compensation is a benefits package, you wanted me to work for you and part of that deal was you covering my healthcare…you don’t like it fine, but don’t make out like I’m spending your money on gold stitches and swedish massages.

I have the money. I can afford to do it, but it just rubs me the wrong way; I can’t explain it. Yesterday my kid tripped and fell on a x-acto knife…8 stitches. Cut to the bone.

$148.00 cash money at the walk-in (no payment plans)…the emergency room would’ve wanted at least $500. The missus asked about the HSA, they had no idea what she was talking about…we’re not covered yet, so it was out of pocket; but one likes to know what the staff thinks about it…she wasn’t impressed.

Thank God, it was the distance and not the money that was the deciding factor. I couldn’t imagine looking at a horrible scar on my kid and knowing that it was there because I couldn’t afford the $500 even with a payment plan.

We’re thinking of going back to being self insured again, but need to crunch the numbers.

20

To throw in another point, my sister is with an HSA and it’s frankly almost the only way in hell that she could hope to have any sort of catastrophic coverage without paying $1,000+/month.