Tell me about HSAs and qHDHPs

In My Humble Opinion
1

For those who don’t know, those are Health Savings Accounts and qualified High Deductible Health Plans.

I know what the problems are on a macro level - healthy people like me pick HSA/HDHP arrangements, leaving the HMOs and PPOs to unhealthy people, leading to insurance rates for unhealthy people being jacked up.

But what are they like on a me level? Have you got one? Do you like it? Are the contracted rates you pay before reaching the deductible reasonable? Do you carry around a copy of IRS Publication 502?

2

I have had an HSA and a qualified High Deductible Health Plan for the last 9 years or so.

Originally this was a pretty good deal. I could insure myself and my two kids for a reasonable premium (around $400 a month) with a deductible of $3k. Then the premiums started going up. Within a few years the premium for that same plan was approaching $900 a month.

So I shopped around for a new plan. This time, to get an affordable premium, I had to raise the deductible to $5 k.

On and on it went. Currently I have a plan with a $10,000 deductible. For myself and one child. The premium is $355 a month.

I’m not sure what your question means regarding “contracted rates you pay before reaching the deductible”. We just pay out of pocket regardless of what the charge is, until we hit $10 k. Of course, there are things they won’t pay for (birth control pills for example) so that is not considered as an expense which applies to the deductible.

I’d be happy to answer any more specific questions you have.

3

I have one and I like it. My company offers 3 different plans: 80/20, 70/30 and the HDHP. They contribute around $2300/year to my HSA to encourage me to take it. My deductible is $3000 and maximum OOP is $7000. This is my third year in it and for the first time I will meet my deductible due to surgery I had on Tuesday.

Before the HDHP, I had an FSA. The HSA has it beat 9 ways to Sunday. I’ve heard from some of my right-wing colleagues that FSA’s have a target on their back with UHC but I guess that has yet to be determined.

4

They’ve only existed since 2004, for the record - part of the Medicare Prescription Drug, Improvement and Modernization Act.

According to our employer’s broker, we/I will pay a “contracted rate” rather than the regular out-of-pocket cost with most providers. It’s basically the fee schedule (ie., insurance-adjusted) amount rather than the full amount.

We have the option of an HMO or PPO but they won’t be 100% employer-paid anymore. There’s only one HSA option - $2,000 deductible with a $1000 employer contribution.

What’s the difference between the deductible and maximum out-of-pocket amount?

5

I have an HSA with a $4000 plan deductible. It’s through my company, which is just me and my partner. Our plans are backed by a small business consortium in Cleveland, so thankfully we get the group rates of all the small businesses in Cleveland and don’t have to pay rates for a single small business.

I think mine costs under $300/mo. I can put up to $3050 in the account per year (it’s an interest-bearing account, too. Quite high!) As it happens, my company just puts the full amount in at the beginning of the year. You or your employer can put money in.

I’m not a completely un-healthy person (don’t have a chronic disease) but I do go to the doctor a lot. I take meds and need blood work, I make sure to go to the eye doctor and gyno once a year, and the dentist twice a year. Plus every so often I get weird conditions that warrant a visit to a doctor. I’ve already been to a podiatrist and dermatologist this year.

I am often surprised at how much the insurance company pays for doctor visits and lab work. I had an x-ray of my lumbar area last year and it seemed really thorough. I remember lying there thinking “man, this is going to cost a fortune.” I think the total amount I paid was under $50.

The insurance also covers a good chunk of gyno visits. In fact, they may cover routine exams completely IIRC. I got an STD blood test last year, including HIV, and it was completely covered.

I got 3 vaccines last year - flu, h1n1 and pneumonia. All covered.

The plan is kind of slack when it comes to prescriptions. A lot of my deductible last year went to special dermatological creams. The Pill is around $30. Other stuff is a crapshoot.

There’s hardly any vision coverage with my plan. But glasses and vision exams can be paid for with the HSA, you just pay full. We do pay extra, as a company, for dental. So that’s nice.

I’ve compared my expenditures to my business partner, who has a regular HMO for him and his wife and kid. We pay about the same out-of-pocket every year (except my pocket = the company’s money in my HSA). He figured out that he can’t switch away from his HMO, though, because of prescriptions. He’d hit the deductible in a few months.

Anyway, I like it. You don’t have to be super healthy to benefit from it completely. The biggest expense, I think, would be prescriptions. You would just want to see what the plan DOES cover to help you decide if it’s worth it or not.

6

Once I hit my deductible of $3000, the plan switches to 80/20. If I have an additional $20,000 of expenses, I will be responsible for $4000 of it. After that, I’ve hit my OOP max and the insurance pays 100%.

7

:eek: I honestly didn’t know you could have that high of a deductible.

8

Ours supposedly covers preventive care (physicals, Pap smears, etc.) at 100% regardless of whether you hit the deductible. I’m wondering if that means I can just schedule my annual physical to coincide with a day when i’ve got the flu or something.

Gotcha. We don’t have that. Once at the deductible it goes to 100/0.

9

Mine must be something different then. It is a health insurance plan for the self-employed, and I first got one in 2001 when I started my own business.

10

Both Mr. Athena and I are self-employed, and we’ve had a HD/HSA plan for about 3 years now. Up until about a year and a half ago, we really had no major health issues, so didn’t really use the plan. Then I was diagnosed as a Type 1 diabetic, and now we use the plan a lot.

Our plan has a $3850 deductible, and currently it costs us $430/month. It started out, 2 years ago, costing about $250/month. So that’s a 60% increase over 3 years, and that’s my only current beef about the insurance itself. If it keeps going up like this, we will eventually be paying a huge amount of our income towards insurance. Having a chronic disease makes me uninsurable were I to try to get another plan, so we’re stuck with this one.

Other than the costs, I’m happy with the insurance. They pay nothing up until we hit the deductible; once we hit it, they pay 100%. They’ve paid for a LOT of stuff that I didn’t expect them to pay for, including a 4-day stint at a diabetes specialist center that included education, appointments with specialists, and lots of lab work. I was planning on paying for a lot of that out of pocket, but they happily paid it.

They’ve also given me no trouble with prescriptions or durable medical goods - both of which are covered the same as doc visits, and are paid 100% after my deductible. I’ve heard from other people that they had to jump through hoops and spend many months getting approvals for things like insulin pumps; they approved me the first time I asked and have paid for everything with no trouble.

11

I assume this means the negotiated rates that in-network doctors agree to accept - and whether you pay that rate, or the “rack” rate.

For example, my current health plan has no deductible. If I see a doctor and the rack rate is 100.00, the insurer will say “discount that 30 dollars, please” and then I pay 25% (I think) of the balance of 70 dollars. So I pay 17.50, and the insurer pays 52.50.

If I had a deductible of 5,000 dollars, would I pay the doctor 100 dollars, or 70 dollars, for that same visit?

FWIW, my insurance last year was basically the same as this, only with lower premiums and a 750.00 deductible. I’d have paid 70.00 for that medical service, not 100.00. And only the 70.00 would have counted for the deductible.

12

Yes, that’s it, only I’ll be paying $70 and the insurer won’t be paying anything, at least until I hit the deductible.

13

Like I said, mine must be something completely different, because whatever I pay to the doctor is not discounted in any way.

RNATB, sorry about mucking up your thread with it.

14

Really? That seems odd.

Mine works like every else’s in this thread - I go to the doctor, they bill my insurance. In a few weeks I get a note from the insurance saying something like “Dr. Sawbones billed us $150 for an appointment. We re-priced it to $100, because that’s what we pay for such things.”

At that point, if I haven’t hit the deductible, I sit back and wait for the doc to send me a bill for $100, and $100 is subtracted from my deductible.

If I have hit it, the insurance pays, and I don’t do anything else.

The negotiated price is a HUGE benefit for me. On a monthly basis, it saves me at least $150 (rack rate on durable medical equipment versus negotiated rate). Most doc appointments are discounted by 25-30%. So if your insurance doesn’t do that, I’d look around for one that does.

15

Frankly I’m tempted to just drop the stuff and go without. It’s not like it’s doing me any good anyway.

16

Had an HSA. Ditched it.

When I first signed up I signed up for a HDHP policy that sat at $64 a month, and a HSA at US Bank with a $25 service fee and a minimum balance of $100. Then my policy went to $70, then to $84, then to $103.

Then on the last year US Bank started charging me $2.50 a month. After a couple months I ask them what the charge was they said it was a Minimum Balance fee. I told them I had the minimum balance and they said they had changed the Minimum Balance to $2500!

So with a 62% increase in HDHP premiums, and a 2500% increase in my HSA Minimum Balance that I’d realistically never get to, I changed policies and closed out my HSA.

17

Well, as someone who went from super-duper-no-health-problems-at-all to guess-what-you-have-a-chronic-disease in the space of one routine physical, I’d caution you not to drop it. If I hadn’t had an insurance policy when diagnosed, I’d have been pretty screwed. Not like I didn’t pay a lot out of pocket, but it would have been MUCH more without insurance, not to mention living in fear of doing something wrong and ending up in the ER and having to take out a second mortgage to pay for it.

18

I think you can have an HSA and not have contracted rates, but anyway, you were trying to help and I thank you :slight_smile:

It had not occurred to me that the bank would be charging service fees on the account, or minimum balance charges. Thank you.

19

My company used an HSA then it turns out someone from the HSA company was using the information for identity theft and was stealing thousands of dollars from each persons accounts. The FBI needed to get involved and everything. Big hassle for everybody. I didn’t sign up for the HSA though because I’m young and don’t have any medical expenses.

20

AFAIK, you ARE allowed to choose the bank that manages your HSA. It is completely separate from the insurance company.

When I got HSA (from the massive Cleveland-based insurance co) it was paired up with the massive Cleveland-based bank. But, you couldn’t get one to advise you on the other. I had no reason to change, as I already liked the bank and was fine with their terms.

But, from everything I’ve read I am almost positive that you can set up your account with any bank you choose, so long as they have an HSA product.

My brother (who works for me) was on our HSA plan for a while, with his account at the same bank. When he dropped our health plan to join his wife’s, he still got monthly statements from the HSA bank and still had his HSA account open for a LONG time, until he canceled it directly. Canceling his account with the insurance company had no bearing on the bank account.

Anyway, while researching HSA plans from an insurance standpoint, you might also want to research them from a banking standpoint.