HSA??
 

My health insurance is ridiculous. $249 per pay plus $15 for dental.
The HSA is $130 less. per pay. The deductible is $3000 annually for a family. If I opt for the HSA and contribute and extra $130 per week, it will take me 23 weeks to cover the deductible. If someone actually gets sick, I could have to pay another $3k max in that first year. it would take me 46 weeks to get to 6k.

If no one gets sick at all, I would have $6760 in my account to cover the next year, and that account would grow tax free at $6760 per year. subtracting no more than $3000 of ordinary medical expenses per year.

the only real risk I see is if one of us gets sick and needs a prescription filled before I have enough saved to cover it. Pills are expensive.

I have until tomorrow to decide what to do.

anyone have advice?

It depends on everyone's state of health ... if no one on the plan has any ongoing prescriptions or conditions that will require care, and if you can consistently put the extra $130/week into the account all year, it sounds like a good route to go. You would be growing the account and able to take care of small costs if they arose before the whole amount was saved. Only if there was a major injury or illness requiring hospitalization and/or surgery would you need the entire amounts.

Hospitals tend to be slow with billing. I'm still getting bills for things that were done last July. So you wouldn't necessarily have to part with the full deductible or out of pocket right away. Hospitals are also very good about setting up payment plans that would allow you to pay as you saved, so to speak, if something happened before the 46 weeks it took to collect the full $6000.

Are there co-pays aside from the deductible, and would they be affordable if necessary? Or would they eat into the $130 weekly? After the deductible and out of pocket requirements are met, is everything covered at 100% for the rest of the year?

The benefit of having the $6760 put away if all goes well, and the possibility of making payments that would fit your savings rate if things don't, make it seem like a good alternative to me. As long as there aren't other details that would make it problematic, that is.

yeah, the coverage is the same as the better offered plan, with the exception of inpatient visits. They would cost me $250 per day with a $1250 max. co pays are the same.

I found a calculator that projects the savings. If I contribute the max ( $6450 this year) and have actual expenses of $1200 per year average... and am in the 33% tax bracket, and 3% state tax, and earn 1% in my HSA, I'd save up $55k over 10 years.

Will the HSA pay 1%? I can't seem to get 0.5% ... but if it does, good stuff. The inpatient stays could hurt but again, hospitals are good about payment plans. All they want to know is that you'll eventually pay. So you could continue to save and pay an unexpected inpatient stay down slowly.

The savings over 10 years are great. Sounds like a winner. If I had that choice, I'd do it. I got caught this year paying max out of pocket but still have all my premiums to pay and no HSA to show for it.

It does depend on you being comfortable with saving $130/week no matter what. Or really, $130 every other week, since the cost is $130 less per pay which you can put directly toward it. If you can do that and don't have a bunch of other major expenses looming (major car expenses or whatever), that's great. If you did have other major expenses in the offing it might be different. But savings over time is a great way to go.

I've only scanned this thread because you said it was very time sensitive. I did not find something that I was looking for that was a total game changer.

In my experience, the funds in the HSA were USE IT OR LOSE IT by the end of the year.

So, you could "save" money, by having it literally saved before you needed to spend it, but by the end, you would need to spend it on some gorram thing or just lose it. Which works exactly like fucking insurance.

Please check the details of your plan for this poison pill. If it is NOT PRESENT, then prepaying, effectively, for your healthcare costs is a good idea for what you describe. Either way, it's a gamble.

If the funds must be spent by the end of the year ... wtf? That would NOT be a useful plan. Only if it carries over and can build would it be reasonable. Thanks for the heads-up, V. I haven't gone through the small print of an HSA plan so wasn't aware. If it's use it or lose it, forget it. You'd put $130 more/month into savings that you would then potentially lose, plus there's the extra for possible inpatient stays.

from Wiki

the "incentive" was that money put into the HSA was tax ... *protected* (I can't reembere the actual term, it was money that was not subject to tax) so you """SAVED""" money by using it. some incentive. My tax burden, in gross dollars, did not change that much by trying to hit some bullseye for my healthcare expenses. Effectively, you were paying with dollars that were X percent more valuable where X represented your effective tax rate not your marginal rate (effective rate, amount of tax divided by amount of gross income. marginal rate, the rate you pay on your last dollar, the highest rate you pay, but no one pays the highest rate on all their money unless they're in the lowest bracket. so being in the 33 pct bracket doesn't mean your hsa dollars are 33 pct more powerful. it's some number lower than that.)

please check your details. lots of people wind up buying incidental medical items bandages ibuprophen, whatthe fuck ever at the end of the year to use up the money.

good catch classic.

that's from wikipedia. jimhelm needs the facts from his specific plan, but it will be language LIKE that, one way or the other.

eta

this is my experience, and it's a couple years old. also, plans change from employer/insurer to employer/insurer, naturally. well, not naturally, but to the advantage of the business in question, but that's not important. my poiint is caveat emptor.

Dunno if this affects your plans or not Jim, but ...
from here

Max contribution for a family is $6450 So $120/mo. Yes it rolls over. I thought I had stated that. The savings calculation certainly inferred that. The $120 is money I would be paying into insurance anyway.

I'm pretty sure I'm going this way. I just wish I was given the info with more time to research. This is the busiest week of the year. I'd like more time to discuss the ramifications with my lawyer, as the divorce is still pending, and jinx is virtually incommunicado. Still.

I need to find out if I can switch back to the other plan during open enrollment down the road, and what happens to money left in the account if I do.

And if I can change my contribution amount during the year...

Just making notes for questions to ask right now...

Well I'm not sure anyone knows exactly what impact the ACA will have on these types of accounts nor the money in them. That was the point I was trying to make. We really won't know until later next year as the info leaks out. "Gotta pass it to see whats in it"
Still pissed about that. Sorry bro. Not an easy thing to decide on such short notice.

have done a bit more research....

you CAN switch back ,and the money stays in the account, available for health expenses, tax free. it can be used to pay COBRA premiums, even.

and you can put whatever amount whenever. I could put the $3000 in there right away, for example.... if I had it!