I have a HDHP for self and spouse. The year runs April-March. I have 2 children with other coverage. The plan has a plan deductible, individual out of pocket max, and plan out of pocket max. I have met the plan deductible and out of pocket max for myself. Out of pocket costs right now are 10% of charges for my wife until we hit the plan out of pocket max. I have an HSA which I max out and plan to use to reimburse myself for charges I paid with other funds.
Problem: I might have to add my 2 children at some point during this benefit year. This would raise the plan deductible and individual out of pocket by $1500 and the plan out of pocket by $3000 (which would also be more than the max allowed HSA contribution.
What I don’t understand is, since I already met the deductibles for the 2 person and I would have to change to the family limits, and I’ve already been billed and satisfied so many procedures (including several $0 bills because I hit the max), would I just have to start paying 100% out of pocket for any new charges until I hit the higher deductibles for the year?
This is certainly going to depend on your exact plan. Doesn’t your plan have a patient advocate or some such you can call and ask? You should also check to make sure you can add them mid year.
Agree with the other response, but also: don’t reimburse from your HSA unless you absolutely have to. Treat it as a (very good - triple tax-free) retirement plan and save it for later, after the investments grow. There is no time restriction to when you can claim medical expenses, so as long as you have some record of unclaimed past expenses you can claim them whenever.
Talk to your HR representative and they should know. What would typically happen is that your deductible would be set at the new higher level and everything you’ve already paid into it will be applied for the year. i.e. If you’ve already put $2,000 towards your deductible and it goes up from $2,000 to $4,000, you’ll get credit for that $2,000 you already spent.
I don’t think I’ve ever had an insurance plan that ended in April or March. All of them have ended in December with a new year beginning on the 1st of January.
I forgot. Some HDHP have a maximum out of pocket expense for an individual even on a family plan. So your total out of pocket for a family plan might be $4,000 but the plan may stipulate that once you hit $2,000 on an individual everything for that person is covered 100% at that point.
Disclosure: one of my clients is a major regional health insurance company.
Most big companies do run their health insurance on a calendar year = plan year basis (i.e., January 1-December 31st). But, for my client, one of the products we work on is “Small Group” health insurance (insurance for companies with 50 or fewer employees), and their plan year dates are all over the map – the single biggest month for their Small Group plans to start is actually July (followed by January, and then June).
What “qualifying life event” has happened that would necessitate you needing to move your children from another plan to yours? There are rules for most insurance plans as to when you can add dependents etc. Otherwise you have to wait until the enrollment period for the next year.
My children qualify for income-based coverage due to my low income and the fact that their mother does not work for income and is to some extent either unable or unwilling to work for money outside of the home.
In other words, my kids are on Medicaid and could be kicked off. My insurance is pretty expensive, and that is why I have a HDHP. My benefits plus HSA contribution are around 35% of my base pay.
I’m just going ahead and try to make this pretty much a catchall reply with some of the specifics others asked for.
Yes, most employers go on the fiscal year. My “day job” is with a very large and well-known employer. All of you know the name and a lot of you probably made a transaction with them today. They are transitioning from a April-march to a Jan-Dec benefit year for 2022 but the deductibles and out of pocket for 2021 run until the end of march 2022. Then they are doing prorated deductibles for 2022.
Yes, my plan DOES have an individual deductible and out of pocket cost, but I’m not worried about that. I had an ER trip and many tests and a surgery. I met mine so my medical expenses are/were “free” until April. What I am worried about is my kids are on all kinds of counseling and psych appointments and medications on a regular basis. This is all covered by Medicaid. Also separately they have vision and dental coverage which covers far more than any “insurance” plans. So if they get switched to my insurance, I’m just wondering how much and how long I’m paying 100% out of pocket for everything.
As far as reimbursing from HSA and not (and using back door retirement strategy and all that), I understand. The relevant point is that I am Working Poor. I really couldn’t afford my surgery or to take off work. my kids being on Medicaid is unfortunately part of my financial survival strategy for now. I work about 60 hours a week and try to keep the utilities on. I took out loans to take off work and get my surgery. Some are 0% and coming due soon. In the back of my mind I knew if it came to it I could use the HSA, and hopefully let it grow after all that’s taken care of.
HR? Patient advocate? Again, I am an hourly worker for that really big company you’ve heard of that’s regularly in the news because people complain about needing to urinate in bottles and all that stuff. HR knows next to nothing. I regularly research and print out and show management the policies they violate, that we are required to self-police or lose our jobs. 99% of the people I work with are temporarily embarrassed millionaires or they praise the lord they even have a job that offers benefits at all. There’s very little support and a culture of ignorance when it comes to most matters.
Yeah, it’s something like the individual and total are $3000/6000 on the couple plan and $4500/9000 on the family plan. I guess my main confusion is that I hit my individual long ago and have had several $0 bills since then. Since my surgery and related expenses are done I don’t anticipate any other charges for myself except a january regular appointment.