Basic Health Insurance/HSA Question

[gutonc]

I'm moving to a new job where I have 2 health plan options. One has an HRA (basically an employer owned HSA that you can't contribute to and doesn't roll over) and the other is a "HDHP" with a $3K/yr family deductible (compared to the $2300 for the HRA plan) and a $6K max OOP (compared to $6600 for the HRA plan). Virtually all other aspects of the plan are identical except for ED visits (covered at 90% vs 100% after $250 copay) and non-preventive PCP visits (also 90% compared to $25 copay).

With the ability to contribute $7850 (in addition to the employer contribution of $1400/yr) and the ability to invest this, the HDHP/HSA is a no-brainer choice here, right?

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[RangerBob]

I agree that the HDHP/HSA is the better option here.

We have a HDHP/HSA. I mostly due it for the HSA and because the OOP max is meaningfully lower than all the other plans I can get on the individual marketplace (I have a silver HDHP directly through Blue Shield). Based on prior years' expenses, it should save me $1-2k/year, so not a ton, but more important is if something major happens our OOP max is lower, which is what always worries me more.

Even then, my OOP max is about twice yours, so I'm still jealous!

 

[gutonc]

I agree that the HDHP/HSA is the better option here.

We have a HDHP/HSA. I mostly due it for the HSA and because the OOP max is meaningfully lower than all the other plans I can get on the individual marketplace (I have a silver HDHP directly through Blue Shield). Based on prior years' expenses, it should save me $1-2k/year, so not a ton, but more important is if something major happens our OOP max is lower, which is what always worries me more.

Even then, my OOP max is about twice yours, so I'm still jealous!

This is why I was struggling to choose TBH. It seems too good to be true for my use case. Even with a chronic medical issue requiring one of those fancy-a** $10k a month drugs (I checked both drug and specialist costs and they are identical between the plans), it seems like I’ll come out way ahead, not even considering the tax implications and investment opportunity.

 

[FutureInternist]

This is why I was struggling to choose TBH. It seems too good to be true for my use case. Even with a chronic medical issue requiring one of those fancy-a** $10k a month drugs (I checked both drug and specialist costs and they are identical between the plans), it seems like I’ll come out way ahead, not even considering the tax implications and investment opportunity.

Also keep in mind that at age 65, you can either reimburse yourself for a lifetime of medical expenses (tax free) or it just converts to a 401K.

 

[The White Coat Investor]

I'm moving to a new job where I have 2 health plan options. One has an HRA (basically an employer owned HSA that you can't contribute to and doesn't roll over) and the other is a "HDHP" with a $3K/yr family deductible (compared to the $2300 for the HRA plan) and a $6K max OOP (compared to $6600 for the HRA plan). Virtually all other aspects of the plan are identical except for ED visits (covered at 90% vs 100% after $250 copay) and non-preventive PCP visits (also 90% compared to $25 copay).

With the ability to contribute $7850 (in addition to the employer contribution of $1400/yr) and the ability to invest this, the HDHP/HSA is a no-brainer choice here, right?

Not a no-brainer. I'd use the HDHP if you tend to spend little on health care and the HRA/low deductible option if you do.

 

[sahabarun]

Congrats on the new job and the upcoming decision on healthcare! You've really broken down the two options in a detailed way. The HRA and HDHP both have their merits, but it looks like you're leaning towards the HDHP/HSA combo. Considering your ability to contribute $7850 in addition to the employer's $1400, I'd agree that it seems like a solid choice. The investment potential can add another layer of benefit. You might want to check out this info at https://www.coveringcfl.net/open-enrоllment-for-health-insurance-in-2024-enrollment-dates-details/ for more insights into insurance options. It's not specific to HSA/HRA, but the general enrollment process can have its intricacies, and it's good to be prepared.