I’m choosing between two options, and want to make sure I’m not missing something (I’ve never been able to choose between plans before, so the details have always been less than important to me). You are not my financial advisor, etc etc…
(Details are approximate):
Plan A (HDHP)
Annual premiums: $4000
$3000 deductible
$7000 max out-of-pocket
Costs for non-preventative care are basically 90% after deductible (70% for out of network)
Plan B
Annual premiums: $10000
$1000 deductible
$5000 max out-of-pocket
Costs for non-preventative care require co-pays (there is a separate deductible/out of pocket max/fee schedule for out of network service)
Presuming that coverage is identical, it seems to me that care under Plan A will at worst cost $11,000 a year, and at best (not accessing care) only $4000, while plan B will at worst cost $15,000 and at best $10,000.
I expect for this year that we would hit our deductible on the HDHP, but maybe not the out of pocket max.
Is there any reason to choose plan B? The only downside to plan A I can think of is that it requires budgeting for potential costs, and expensive care early in the year could mean needing to spend a lot of money up front, before I’ve made my monthly “contributions”.
But really, Plan A is a no-brainer, right? It’s cheaper on both sides of the coin.
Yes, as long as you can budget for the extra deductible (using a health savings account (HSA) I assume), then Plan A is a no brainer. Every place I’ve worked in the last decade or so has offered high deductible plans that were pretty attractive.
Also, presumably you only have access to an HSA with the high deductible plan? HSA’s are a very nice thing to be able to use.
I use a HDHP and automatically max out the HSA. I may end up using neither (things like my annual preventative visit with bloodwork are covered 100% regardless), but the higher premium ones you pay upfront and the money is gone. At least with HSA you can use it as expenses occur while banking it, or reimburse yourself (sometimes I use a credit card or 0% financing deal upfront), and/or invest and use as an extra retirement plan.
I don’t see anything better about Plan B. The amount of the increase in premium is totally out of line with the change in deductible to the point where I have to assume that you got some numbers wrong, or worked out the premium on each with a different set of covered individuals.