If you're healthy and not using your insurance, this money can be a secondary retirement account. The primary difference being who ends up paying the bill. So if I put $1000 in 2017, is it just adjusted for inflation so it will grow slightly more in 2018 and so on? 5. Please do let me know if you notice anything that seems wrong. So if you're healthy and not risk adverse, this option (usually the cheaper between the two) is the way to go. But it sounds like I just need to get more organized since this plan seems like the best option. With this, once you are older, you have a good amount of money saved and growing in your HSA tax free that you can use to cover medical costs for you as you age and medical needs arise. but I do have reservations with it's implications that for all scenarios HDLP is best. 1. Using the the numbers from my friend’s plan and assuming the cost of my friend’s health care services comes out to $2,000 a year, you see if the employee does not contribute any extra money to the HSA, the total after-tax cost to the employee is about the same between the low deductible plan and the high deductible plan ($3,008 vs $3,244). You just want to make sure you have … Premiums tend to be much higher on a PPO type plan than on a high deductible plan. ), There are contracted rates for services, my guess is you were either out of network or the billed amount just happened to be the contract rate or I suppose they didn't file it for you. 7 comments. If the low deductible plan premiums are $100 more per month, that means you can afford to contribute $1200 per year without paying any extra. I would probably contribute $438 to the HSA. As a matter of fact, it looks to be such a clear-cut winner in 95% of all cases I can think of that you may want to ask someone on HR what's up with the PPO offering. Okay this is really good to know! Scam alert: Ignore any private messages or chat requests. Back to an HMO despite it costing overall more for less coverage. What Is an HDHP? Your HDHP has the lowest allowable deductible to still be considered high-deductible coverage. [–]MendedSlinky​ 2 points3 points4 points 3 years ago (6 children). A plan might have a $25 copay for every doctor visit, 20% coinsurance for every prescription, but a $10 copay for every visit to a speech therapist. Both HDHP and PPO could involve you getting multiple bills from the same treatment period. A deductible is the amount of money that must be paid for covered services before the health insurance company begins paying for expenses. edit 2: Please take note of the limitations of the spreadsheet before making any final decisions. Your specific benefits and costs depend on which plan you choose. Particularly the lack of support of FSA accounts and[FSA now supported!] In … I'll need all the help I can get :), [–]shoesafe​ 1 point2 points3 points 3 years ago (0 children). 6 Differences Between an HRA vs HSA. Health insurance comes in two primary forms. [–]E1ghtbit​ -1 points0 points1 point 3 years ago (0 children). Where to Find a High-Deductible, HSA-Compatible Plan? [–]vikramjatt11​ 2 points3 points4 points 3 years ago (1 child). Use of this site constitutes acceptance of our User Agreement and Privacy Policy. Let's say you have a $200 doctor visit today. If you pay out of pocket, you save the receipts to prove you have paid out of pocket (I scan everything into a Google Drive folder and name the file YYYYMMDD-PracticeName). 4. High Deductible Health Plan (HDHP) ... (HSA). The PPO doesn't have a massive deductible, and many PPO plans have a much lower maximum out of pocket limit than the HDHPs do. Healthcare billing isn't really my thing. And in order to open an HSA, you need to be covered by an eligible high deductible health plan (HDHP) and have no other coverage. My hdhp has negotiated rates. PPO is going to limit your total expenditure, generally. So if you aren't contributing up to the max already, try plugging in a bigger number and see what happens. Go to file -> Make a Cppy. I'm convinced it's the way to go. Use cell validation to make 3-5 drop downs that correspond to health care costs (A37:A87) each year for 3-5 years. You are correct, and I did note that the FSA is missing in the 'Limitations' box. Good luck with the new job and move! Cost out of paycheck: $151.62/month; $1,819.44/year. The HSA is a portable account so you keep your money even if you switch jobs. If you're healthier or have something catastrophic, it actually makes more sense for the HDHP, but if you're just pretty ill, the PPO makes sense. Coinsurance after deductible: 10%. Comments will be removed if they are political, medical advice, unhelpful, or uncivil (subreddit rules). It doesn't take into account State or FICA tax deductions but seems to be pretty solid on everything else. Here, please treat others with respect, stay on-topic, and avoid self-promotion. An HDHP plan is typically about 10% cheaper than a traditional preferred provider organization (PPO) plan and is usually associated with a company funded tax-advantaged health savings account (HSA) that is meant to fund some of your medical expenses. I learned a lot and I'm signing up for the HDHP! If you don’t have an HDHP, you can’t have an HSA. I'm just a random person on the internet. I just got home and made an edit to include multiyear estimates. Generally, if you're healthy the HDHP is the way to go. The caveat is that you have to keep all your receipts. How does it grow? Press question mark to learn the rest of the keyboard shortcuts. However there is no time limit. If none of the members of your family suffer from an expensive, chronic medical condition, chances are good that a High-Deductible Health Insurance Plan (HDHP) is the right plan for you due to its lower premiums. With the HSA plan, you can contribute $3,400 pre-tax (minus the free money your company gives) into your HSA and invest the money into a good low cost fund. High Deductible Health policy’s will feature a lower monthly premium when compared to a copay plan however it will have a higher deductible and maximum out of pocket. The PPO covers more of your medical costs from the beginning. No, you are correct, you will get a 10% penalty if its for a non-medical expense. However, if the employee takes … Just popping in to say that this is super awesome. This is my first job out of graduate school and I really want to get everything right. A HSA is one of the best investment tools, and if you start saving in it now while you are young, single, and healthy, compound interest will be your best friend. In your specific case, the HDHP certainly looks like a better option, regardless. Since FSAs are treated similarly tax-wise to HSAs, you can make the comparison more fair by just reducing your HSA contribution by whatever amount you would have contributed to an FSA. [–]ISWTP 0 points1 point2 points 3 years ago (0 children). To fund an HSA, you must have high deductible health insurance policy (HDHP) coverage. Standard PPO or HDHP? So let’s explore what an HDHP is and how it can work in tandem with an HSA. REDDIT and the ALIEN Logo are registered trademarks of reddit inc. π Rendered by PID 13395 on r2-app-0a5bef6813b34ce8e at 2021-02-04 13:44:43.540214+00:00 running 7743784 country code: US. © 2021 reddit inc. All rights reserved. It also means that you’ll be paying more of the healthcare costs for your family before the insurance pays its share. Think of your HSA as a special IRA. It would still be nice to have better FSA support in the spreadsheet so there's a good chance I'll add it in the future. Taxpayers that make contributions on their own will be able to take a tax deduction known as an adjustment. The site may not work properly if you don't, If you do not update your browser, we suggest you visit, Press J to jump to the feed. So the withdrawal is for a medical expense, but you already paid the medical expense out of pocket and the reimbursement could be spent on whatever you want. edit 3: Check out this worksheet if you expect a lot of expenses that would be subject to a co-pay instead of the deductible on one of your plans. Hope this helps, I can try provide more detail if needed... [–]scivet16[S] 2 points3 points4 points 3 years ago (2 children). 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