Guess what day it is? It’s open enrollment! You know what that means. Mind numbing health insurance calculations. As we stand on the precipice of Obamacare our insurance options are quite a bit different this year than before. My husband’s company has mixed things up by offering an HSA. In theory I adore HSA plans. They actually make a person think about the price of health care. Which is awesome. When you introduce price into the equation it really affects the marketplace. When consumers shop around it creates competition which drives prices down because doctors have to compete on price as well as service.
But anyways… let’s take a look at my options.
$3,000 deductible per person/ $6,000 per family (Max out of pocket $5,500 person/ $11,000 family)
out of pocket premium $1,835.60 per year.
Bonus: 2,000 contributed to savings account per year from the company.
$750 deductible per person/ $2250 family (Max out of pocket $3500 person/ $7000 family)
out of pocket premium $4,898.40 per year
$1500 deductible per person/ $4500 per family (Max out of pocket $4,500 person/ $9,000 family)
out of pocket premium $3,561.48
Basically once you hit the deductible the HSA and Option A are the same. Both pay 80% of expenses up to the max. Option B pays 70% of expenses up to the max.
So where do I even start?
It’s hard to get your head around so many variables.
HSA vs Option A
Costs are on an annual basis.
Also keep in mind that my husband’s work will chip in $2,000 per year towards out of pocket costs for the HSA. So that makes the HSA way cheaper. Also, I could go to the shrink less often. I could certainly only go once per month or even not at all. I might also be able to strike a deal with my chiropractor.
Of course we take on more personal risk with the HSA. The deductibles and max out of pocket are higher. I think for the extra three or four thousand a year we are saving it’s worth the risk.
HSA vs Option B
Interesting. When you consider the $2,000 per year that my husband’s company will chip in Option B is only $1,700 a year more expensive. That’s just over $140 per month. When you consider that with the HSA I would have to alter my current health care plan (see the shrink and chiropractor less often) plus take on additional risk it seems that Option B might be the best plan. But it’s very close.
The big question is “Do I think I will spend more than $1,700 per year than I’m planning on?” Obviously that’s not a question I can really answer. I will have to think about it some more.
In the spirit of thinking about it some more lets see what happens if something catastrophic were to happen. Let’s say that my family gets into a car accident and we have $15,000 in medical bills. What would that look like?
Let me do some explaining. For me, in the HSA I already meet my deductible just with my planned spending so I would only be responsible for 20% of my $5,000 bill. The other family members would have to pay the full deductible and then 20% of what is left over.
For Option B, I don’t believe copays count toward you deductible so I’m assuming we would all have to meet our full deductible and then pay 30% of anything left over. BUT we have a $9,000 max out of pocket. That’s why we don’t have to pay anything for family member #3. Make sense?
If my head is on straight and my assumptions are correct that makes the HSA the clear winner. Not only is it cheaper on the regular stuff it’s also cheaper on the big stuff.
Ultimate Winner: HSA!