Another insurance question

[raeoflyte]

I have to finalize my insurance and I know I need to go with the PPO (because we're stupid poor right now), but I just can't seem to pull the trigger. 

I have an option of a PPO and a HD HSA.  We're on the PPO now, but the premium for that is going up quite a bit.  Our plan was to stick with the PPO and max our FSA of $2500.  The family deductible on the PPO is $3000 and based on this years spending the $2500 we put in the FSA should pretty well cover us for everything.  The PPO premium is $2300 a year higher than the HSA.  

The HSA plan has a $2500 individual deductible and $5000 family deductible.  There are 4 of us.  I can pretty much guarantee we'd be on the hook for the $5000 which is a lot of money.  But even if we go with the PPO, between the higher premiums and FSA we're spending $4800 a year.  That other $200 wouldn't kill us.  

Both plans have the same maximum OOP cost of $10,000.  If we were all in a car accident or something awful we'd end up hitting that $10k regardless of which plan we take.  

So the real issue is if it's not something terrible, just everyone has something here or there that they have to deal with--after we hit our $5000 deductible, we'd still be paying 20% of all visits and prescriptions.  That is the amount that could really hurt us right now. 

So I need to stick with the plan of the PPO and the $2500 FSA--right?  Am I missing anything?  If I went with the HSA I'd just be gambling that hopefully next year is a low medical needs year and that we'd keep some of that money, but realistically that isn't likely.  

We're going to do the dependent care FSA as well, although that amount is pretty small since we're not sure if ds will move to Kindergarten next fall or stay in preschool part time.  But we'll see.  

[Angel!]

In each plan what is covered before hitting the deductible? 

I thought usually with PPOs a lot more is covered without having to pay the full deductible than with an HDHP.  So the PPO may cover prescriptions & such with a copay, whereas the HDHP may not.  I think this is the most important question to answer.

What is the cost-sharing after you hit your deductible for each plan?  Are they both 80/20 or at least the same?


Here is what I see: 

Use no insurance - PPO will cost $2300 more

Have a huge disaster & hit max OOP - PPO will cost $2300 more

So the real question is - is there a sweet spot in between where PPO will likely save you money & make it worth taking?  Unless the PPO covers a lot more outside of the deductible, then I don't think this is possible.  If it covers prescriptions with copays, doc visits with copays, & you expect a lot of both, then maybe the PPO is a better deal.

[The Walk of the Penguin Mich]

You estimate that you pay out about $4800 each year.

The PPO would be $2300 more + $3000 deductible = $5300

The deductible for the HD plan is $5000 = $5000, so $300 less.

It seems like it's about a wash. The only way to determine this IMO is what's covered on each plan. Otherwise, what is the individual deductible for the PPO? Is it likely one person in your family is going to hit the individual deductible?

[HoneyBBQ]

You get to keep the money in the HSA for future years. I'd go with that.

We did the HD plan for years and I liked it.

[raeoflyte]

Nov 20, 2013 12:03:01 GMT -5 Angel! said:

In each plan what is covered before hitting the deductible? 

I thought usually with PPOs a lot more is covered without having to pay the full deductible than with an HDHP.  So the PPO may cover prescriptions & such with a copay, whereas the HDHP may not.  I think this is the most important question to answer.

What is the cost-sharing after you hit your deductible for each plan?  Are they both 80/20 or at least the same?


Here is what I see: 

Use no insurance - PPO will cost $2300 more

Have a huge disaster & hit max OOP - PPO will cost $2300 more

So the real question is - is there a sweet spot in between where PPO will likely save you money & make it worth taking?  Unless the PPO covers a lot more outside of the deductible, then I don't think this is possible.  If it covers prescriptions with copays, doc visits with copays, & you expect a lot of both, then maybe the PPO is a better deal.

Both plans cover preventative visits 100% no copay or charge, so dh and I's annual exams and the kids well child visits.  For the PPO sick visits and prescriptions have a copay, and on the HSA those are 100% out of pocket until you hit individual or family deductible.  Both are an 80/20 split after deductible to OOP. 

Dh has a couple regular prescriptions, and in general is the person who goes to the doctor the most (but didn't go at all this year).  I've always been very healthy/few doctor visits but I hurt my back this year and while I'm okay now I'm wary of how that is going to play out.  We're over reactors with the kids and take them in to be seen when they probably don't need to be.  When we waited 3 days to take ds in recently of course he had influenza, so that will make us more likely to jump the gun on taking him in next time. 

[raeoflyte]

Nov 20, 2013 12:22:40 GMT -5 The Walk of the Penguin Mich said:

You estimate that you pay out about $4800 each year.

The PPO would be $2300 more + $3000 deductible = $5300

The deductible for the HD plan is $5000 = $5000, so $300 less.

It seems like it's about a wash. The only way to determine this IMO is what's covered on each plan. Otherwise, what is the individual deductible for the PPO? Is it likely one person in your family is going to hit the individual deductible?

The individual deductible on the PPO is $1500.  This year I hit my individual deductible.  That hasn't happened before unless I was pregnant (which won't be happening in 2014!).  My money is always that dh would hit his, although this year he didn't go in at all.  

[justme]

I got super fancy/complicated with mine when I calculated the difference between a tradition plan and a full deductible plan. Prescriptions are the same with both so I didn't have to take that into account (and why I don't qualify for a HSA, boo). I went through all my EOBs and found out how much each Dr visit cost - not what was billed but the sum of what I paid and what the insurance paid - and the guesstimated how many visits to each Dr and looked at it that way.

However, my OOP max is a lot lower than yours so it was real easy to compare the two - I've hit my OOP max the last two years I was on the deductible plan by March - where as the big unknown is what you spend after you meet the deductible.

[Rocky Mtn Saver]

Nov 20, 2013 12:43:23 GMT -5 HoneyBBQ said:

You get to keep the money in the HSA for future years. I'd go with that.

We did the HD plan for years and I liked it.

Either way, you expect to hit the $5k cost, right?  "Expect" is the key here, I think. 

If you go with PPO, and no one has a major illness or an accident, you do not get that $5k back. 

If you go with an HDHP and put the extra $ in an HSA, and no one has a major illness or an accident, you can keep the money for the major illness in 2015 instead. 

[raeoflyte]

Nov 20, 2013 13:50:08 GMT -5 Rocky Mtn Saver said:

Nov 20, 2013 12:43:23 GMT -5 HoneyBBQ said:

You get to keep the money in the HSA for future years. I'd go with that.

We did the HD plan for years and I liked it.

Either way, you expect to hit the $5k cost, right?  "Expect" is the key here, I think. 

If you go with PPO, and no one has a major illness or an accident, you do not get that $5k back. 

If you go with an HDHP and put the extra $ in an HSA, and no one has a major illness or an accident, you can keep the money for the major illness in 2015 instead. 

I guess I'm just freaked out of being nickel and dimed over the $5k...

[Rocky Mtn Saver]

Unless you can't afford the $5k in the first place, it shouldn't be any more of a problem than writing a $400 check each month.  I direct deposit a set $ amount into my HSA account each paycheck, and then just use its debit card when I have medical expenses.  Easy-peasy for me! 

[bean29]

Our PPO vs our HSA, if you hit the deductible for the HSA you will pay less out of pocket with the HSA than the PPO.  Once you hit the deductible for the PPO, you continue to have the co-insurance until you hit the Max out of pocket number.

I agree that you should go for the HSA and this is why I would go for it.  I assume you are saving for retirement.  Do you save in your 401K beyond your 401K employer match?  Do you realize that 401K is tax free going in but taxable coming out.  HSA is tax free going in and tax free coming out if you use it for medical expenses.  So they say to max your 401K to the extent of your employer match, then fund your HSA to the max, then go back and fund your 401K.

FSA is use it or lose it.  If you don't spend all your HSA $$ they roll forward to be used for future medical expenses.

[justme]

Nov 20, 2013 14:02:15 GMT -5 raeoflyte said:

Nov 20, 2013 13:50:08 GMT -5 Rocky Mtn Saver said:

Either way, you expect to hit the $5k cost, right?  "Expect" is the key here, I think. 

If you go with PPO, and no one has a major illness or an accident, you do not get that $5k back. 

If you go with an HDHP and put the extra $ in an HSA, and no one has a major illness or an accident, you can keep the money for the major illness in 2015 instead. 

I guess I'm just freaked out of being nickel and dimed over the $5k...

Assuming they're operated by the same provider, and the same provider you have now, you can go through your EOBs from this year to find out how much the Dr/ER/urgent care/whatever was actually paid and that's how much you'll have to pay under the HDHP.

[raeoflyte]

So I pulled all of our appointments and prescriptions for the year.  

This year total billable services were $10,648 for the 4 of us.  What I can't tell on this is what is preventative visits since those we won't be charged for, and bloodwork always seems to be a crapshoot.  Even if its part of your preventative visit I never know how much insurance will cover.  But obviously none of us are cheap. 

My back issues put me at over $4k for the year, and everyone else was just over $2k each. 

So if we were on the HSA this year we would have paid out the first $5k, and then paid 20% of the rest which would have been $1130.  Does that sound right?  

What I'm not understanding is this year our out of pocket expenses have been $2632.  Our personal deductibles have been $1250, so a little bit lower, but that still isn't matching up with what I'm calculating we would pay with these exact same expenses next year.  

I know I'm dense, but what am I missing?  

2014 estimates based on 2013 spending: 

HSA annual premium: $4104                                             PPO annual premium: $6420
Deductible:              $5000                                             Deductible:              $3000
Coinsurance:            $1129                                             Coinsurance:            $1529
Total:                     $10233                                           Total:                     $10949

[Angel!]

Nov 20, 2013 12:50:12 GMT -5 raeoflyte said:

Nov 20, 2013 12:03:01 GMT -5 Angel! said:

In each plan what is covered before hitting the deductible? 

I thought usually with PPOs a lot more is covered without having to pay the full deductible than with an HDHP.  So the PPO may cover prescriptions & such with a copay, whereas the HDHP may not.  I think this is the most important question to answer.

What is the cost-sharing after you hit your deductible for each plan?  Are they both 80/20 or at least the same?


Here is what I see: 

Use no insurance - PPO will cost $2300 more

Have a huge disaster & hit max OOP - PPO will cost $2300 more

So the real question is - is there a sweet spot in between where PPO will likely save you money & make it worth taking?  Unless the PPO covers a lot more outside of the deductible, then I don't think this is possible.  If it covers prescriptions with copays, doc visits with copays, & you expect a lot of both, then maybe the PPO is a better deal.

Both plans cover preventative visits 100% no copay or charge, so dh and I's annual exams and the kids well child visits.  For the PPO sick visits and prescriptions have a copay, and on the HSA those are 100% out of pocket until you hit individual or family deductible.  Both are an 80/20 split after deductible to OOP. 

Dh has a couple regular prescriptions, and in general is the person who goes to the doctor the most (but didn't go at all this year).  I've always been very healthy/few doctor visits but I hurt my back this year and while I'm okay now I'm wary of how that is going to play out.  We're over reactors with the kids and take them in to be seen when they probably don't need to be.  When we waited 3 days to take ds in recently of course he had influenza, so that will make us more likely to jump the gun on taking him in next time. 

So the big difference is that you really don't touch the PPO deductible barring something major - ER visit, surgery, labwork, etc.  I would assume you don't really plan for any of those to happen, although maybe you do with your back?? But, either way those will hit you hard under either plan.

I think that leaves the real key being how much your DH's prescriptions would cost under HSA. If they are fairly cheap prescriptions that won't cost much more than the copays, then I would go HSA. You save $2300 on premiums. Sick visits alone generally aren't too expensive - $70-$100 in my experience. So not much more than a copay. If you use very little insurance, then HSA will save you money. If you use tons, HSA will save you money.

The only way I see a PPO saving you money is if your DH's prescriptions run $2000+/yr and you don't use much else in the way of insurance that year. With HSA you would owe that whole $2K + the extra for a few doc visits perhaps. The PPO would have just cost you the copays. So I would make my decision based on those prescription costs.

[justme]

Maybe you're looking at the wrong numbers? My insurance calls billable whatever the place sends them. They then discount it, leaving the actual amount paid - which is then split between what I pay and what they do. If yours does it the same way your billable will be way overstated of what is actually paid.

[raeoflyte]

Nov 20, 2013 15:34:52 GMT -5 justme said:

Maybe you're looking at the wrong numbers? My insurance calls billable whatever the place sends them. They then discount it, leaving the actual amount paid - which is then split between what I pay and what they do. If yours does it the same way your billable will be way overstated of what is actually paid.

That could be, but from what I've been told on the HSA I pay the provider what they bill at the time of service until I hit my deductible.  

I need to double check that. 

[justme]

Nov 20, 2013 15:58:20 GMT -5 raeoflyte said:

Nov 20, 2013 15:34:52 GMT -5 justme said:

Maybe you're looking at the wrong numbers? My insurance calls billable whatever the place sends them. They then discount it, leaving the actual amount paid - which is then split between what I pay and what they do. If yours does it the same way your billable will be way overstated of what is actually paid.

That could be, but from what I've been told on the HSA I pay the provider what they bill at the time of service until I hit my deductible.  

I need to double check that. 

Do, that sounds wrong to me. Granted I'm a high deductible but with an HRA so it could be different, but I only pay what the insurance discounts any bill down to. So like one Dr always bills $120, my insurance discounts it $60, so I only pay $60 until I hit my deductible.

[Rocky Mtn Saver]

Nov 20, 2013 16:00:38 GMT -5 justme said:

Nov 20, 2013 15:58:20 GMT -5 raeoflyte said:

That could be, but from what I've been told on the HSA I pay the provider what they bill at the time of service until I hit my deductible.  

I need to double check that. 

Do, that sounds wrong to me. Granted I'm a high deductible but with an HRA so it could be different, but I only pay what the insurance discounts any bill down to. So like one Dr always bills $120, my insurance discounts it $60, so I only pay $60 until I hit my deductible.

Correct, justme.  I have an HDHP with an HSA, and I only pay the insurnance company's negotiated price.  As in your example. 

[Angel!]

Nov 20, 2013 16:00:38 GMT -5 justme said:

Nov 20, 2013 15:58:20 GMT -5 raeoflyte said:

That could be, but from what I've been told on the HSA I pay the provider what they bill at the time of service until I hit my deductible.  

I need to double check that. 

Do, that sounds wrong to me. Granted I'm a high deductible but with an HRA so it could be different, but I only pay what the insurance discounts any bill down to. So like one Dr always bills $120, my insurance discounts it $60, so I only pay $60 until I hit my deductible.

  You pay what insurance says you pay.  I don't think I've ever seen a bill that wasn't at least slightly discounted.  Some of my labwork has been discounted by as much as 95%.

[raeoflyte]

You all are right.  I will wait until the EOB comes out and then pay on the HSA.  

Dh has $1200+ a year in rx's, and quite a bit of lab work that he is supposed to keep up on.  But that part is all under preventative and our doctor really works with the insurance company on coding it right.  So, I think you all have talked me into the HSA.  I'm still a little nervous about it, but I'll try to let that go. 

[Rocky Mtn Saver]

Nov 20, 2013 16:13:40 GMT -5 raeoflyte said:

So you don't pay anything at the time of service, but wait until the EOB comes out?  

Yes, unless the doctor can give me the correct numbers up front after speaking with the insurer.  I almost always wait to get a bill. 

[Angel!]

I did have one doctor that insisted on payment up front.  I think she was just being difficult & I didn't want to argue.  I ended up having to get a refund because they overcharged me.

But, otherwise doctors will send the bill to insurance, then send a bill to you after they hear back from insurance.  So I still get my bill from the doctor, but only after they bill insurance first.  Then I check my bill against my EOB, just to be sure that they are billing me the correct, discounted amount. 

[Rocky Mtn Saver]

Nov 20, 2013 16:23:49 GMT -5 Angel! said:

I did have one doctor that insisted on payment up front.  I think she was just being difficult & I didn't want to argue.  I ended up having to get a refund because they overcharged me.

But, otherwise doctors will send the bill to insurance, then send a bill to you after they hear back from insurance.  So I still get my bill from the doctor, but only after they bill insurance first.  Then I check my bill against my EOB, just to be sure that they are billing me the correct, discounted amount. 

[Angel!]

Here are some examples I looked up from this year for my family:
- Allergist visit + Lung function test - doctor bills $211, I actually owe $152.
- Kid's visit to doc when sick - doctor bills $116, I actually owe $81
- Blood test - Lab bills $184, I actually owe $19 (labwork is always ridiculous for some reason)
- DS's tonsilectomy - billed $2696, I actually owe $1500