HSA plans: good, bad, or ugly???

[Classical Country Mama]

Does anybody have experience using an HSA (Health Savings Account) plan for your medical coverage? If so, what has been your experience--positive, negative, neutral? I am especially interested in Cigna's, if you happen to know anything about them.

 

We have to decide today between the arm-and-a-leg-out-of-my-paycheck-but-covers-everything plan and the high deductible HSA plan (covers 100% after deductible and is MUCH cheaper in the long run if we can survive the deductible) and yesterday is the first time I'd heard of HSAs.

 

Would love to hear your experiences! Thanks so much.

[K&Rs Mom]

We've had two (dh changed jobs), and really like them. Both had a reasonable copay for checkups ($25 I think) and covered preventive care, and we rarely go to the doctor so for us it makes more sense to save that money than to dump it into premiums. If you have any ongoing or chronic things, though, it's probably not a good idea. We've also been lucky that dc have stayed out of the ER - that would be enough to use up our deductible. The nice thing about the HSA, though, is that after a couple of years you'll have enough in the savings account to cover the deductible if you haven't used it much along the way. Or you can use that $ to pay premiums if you need to later.

[bluemongoose]

We have one and we do love it. We like it because the high deductible is less than what the monthly premiums were for the year on our other plan we had before. So even if we blow the whole thing we are still paying less. Plus the money is put into the account before taxes are taken out, so again saving us money. You are given a debit card that is linked to the account so that you can pay for prescriptions and medical bills. Ours doesn't have a copay or monthly premiums that we have to pay, so just the deductible. It is much much cheaper for our family. Of course our employer does pay toward it, but they like this plan better than the others they offer because it is cheaper for them as well.

 

The only bad....you get one credit card per couple. DH picks up all prescriptions because the card is in his name. If I must pick something up while he is at work, then I must pay out of pocket rather than our HSA.

 

The ugly has not happened yet, but I know there is talk about the gov changing the way HSA work. The changes are not to our benefit. Thing like limiting the amount you can put into the account. The amount I have seen thrown around would be half the amount of my deductible, meaning I would have to come up with the other half out of pocket. I DO NOT like this idea AT ALL! And I really hope this doesn't go through... I have also read that they might do some taxing on it. I dont agree with that either!

[QueenCat]

We have one and we do love it. We like it because the high deductible is less than what the monthly premiums were for the year on our other plan we had before. So even if we blow the whole thing we are still paying less. Plus the money is put into the account before taxes are taken out, so again saving us money. You are given a debit card that is linked to the account so that you can pay for prescriptions and medical bills. Ours doesn't have a copay or monthly premiums that we have to pay, so just the deductible. It is much much cheaper for our family. Of course our employer does pay toward it, but they like this plan better than the others they offer because it is cheaper for them as well.

 

The only bad....you get one credit card per couple. DH picks up all prescriptions because the card is in his name. If I must pick something up while he is at work, then I must pay out of pocket rather than our HSA.

 

The ugly has not happened yet, but I know there is talk about the gov changing the way HSA work. The changes are not to our benefit. Thing like limiting the amount you can put into the account. The amount I have seen thrown around would be half the amount of my deductible, meaning I would have to come up with the other half out of pocket. I DO NOT like this idea AT ALL! And I really hope this doesn't go through... I have also read that they might do some taxing on it. I dont agree with that either!

 

Are you sure that's an HSA, and not an FSA (Flexible Spending Account)? The way your describing it sounds so much more like a FSA than an HSA.

[1bassoon]

Don't have much time, but my dh used to work for CIGNA, so we had their HSA this past year. . .

 

I absolutely love it. No forms to fill out, debit cards made it easy - I could go on, but have to go do a lesson! It's good stuff, though.

[MommyX8]

We just had to go through open enrollment to choose next year's plan. Originally we thought that an HSA would be our best option. I crunched all of this year's numbers and it was not the best. Our prescriptions is what we based our decision on.

 

I am on a prescription allergy medicine. The HSA (at least the one we were offered) has you paying full price for prescriptions and that counted toward your deductible. That prescription was $1500 per year. My daughter is on a medication for night-wetting. That prescription is over $2,000 per year. So, just with those 2 prescriptions, we would most likely always be hitting our $4,500 deductible each year.

 

Also, we had no out of network chiro coverage with the HSA and my family visits our chiropractor 100+ times a year. That would have been another $3,000 out of pocket that didn't even count as deductible.

 

Other than that, I would have LOVED to have had a medical savings account. I have a Flexible Spending Account but I hate forecasting our medical spending before they happen.

[amyable]

We are being switched to Cigna's HSA this year, I'm so glad you asked this question! :bigear:

[MommyX8]

I'm in the Shenandoah Valley, too.

[bluemongoose]

Are you sure that's an HSA, and not an FSA (Flexible Spending Account)? The way your describing it sounds so much more like a FSA than an HSA.

 

 

Yes I am sure...it is really an HSA:)

[Dobela]

I have had HSAs more than once and loved them. The deductible is higher so that is a serious consideration, especially if you have prescriptions. The last one I was one included prescriptions in the deductible and I admit I had sticker shock at the price of my son's antibiotic once. In the past we have had HSAs that did not include prescriptions in the deductible and we always paid a percentage (like 20% of the total cost) so that may be something you want to ask about. It was so nice knowing we had money in a forced savings account for those emergencies we don't expect - like my dh breaking both pairs of glasses irrepairably in one week and having to buy new ones. We were also able to use the money for dental expenses which was nice since we don't have dental coverage anymore.

 

We also had one debit card but after calling the company found out that we could also request a checkbook for $7.00. We did that and it helped tremendously with making it easier for me to pick up prescriptions and pay other out of pocket medical bills and the like. Another company gave us 2 debit cards after we called and requested one, but it was for a small fee as well. $10 maybe?? We found it very worth the small fee for the convenience.

 

HSA and FSA work very similarly and some pharmacies here use the terms interchangably. I love how our Walgreens will show on the receipts which additional items (bandaids, etc) can be paid with our HSA.

 

One thing to be aware of, however, our last HSA sent tax papers at the end of last year that we had to file with our taxes as potential income. We had to sign a statement saying that the money we removed from the account was used for medical expenses and supplies not otherwise covered by our insurance for it to not count as income (our accountant had us do this). It must be a new law or something because we had never receoved papers like that in the past. But, since last year was a heavy medical expense year it wasn't an issue.

[Mommyof4ks]

We love, love, love HDP! Our son has cancer, and his medical bills are CRAZY high. We know that no matter what the bills are we will only pay X dollars a year, period and our premiums are so low it is silly really. We have BCBS insurance, but I am guessing CIGNA works that way too. The deductible is only met once as a family also which is much better than the copay plan we had where we had to meet the ded. twice (two family members) before co-ins. started and copays continued even after the out of pocket max was met. It was kind of like this :eek:.

 

We looked around for the best deal on an HSA; 2010 will be the first year we use the HSA we have had an FSA with our HDP for the last 2 years. One way we save money on prescriptions is to go through the $4 and $12 programs at local pharmacies, and we can still use HSA to pay for it.

[Guest Pat]

We have a Cigna HSA plan. If you have to have Cigna you might as well have an HSA plan because they contest most medical claims. Then if the claim gets resubmitted they ignore it and say these expenses are duplicates and have been previously processed. Or and I am quoting from my EOB, This procedure denied as a duplicate. The maximum allowed daily occurrence for this service was exceeded due to codes previously submitted. If you sign up for Cigna be prepared to spend a lot of time on the phone and writing letters to Cigna.

Pat (Mom to a 4 year old)

[momofkhm]

We switching to one for next year so I can't say if it's goo bad or ugly. The thing I remember Dave liking was that you could carry over whatever unused money was in the account from one year to the next.

 

We're hoping we have carry over as dh has a kidney condition. Docs told him at the time we had 15-25 years until kidney failure (could be as early as 2019). We're hoping to have lots in the account by the time we need it.

[RegGuheert]

To date our plan has been with Wells Fargo, but next year it will move to Fidelity. Here are a couple of thoughts:

 

1) I like the fact that the HDP combined with the HSA has allowed us to greatly reduce our monthly premium through my employer.

2) The HSA is a tax shelter, allowing me to put money into an account tax-free, over and above what goes into the 401k plan.

3) Both Wells Fargo and Fidelity allow multiple cards. This is particularly important with children away at college. We have four cards, one each for MomsintheGarden and me and one each for our oldest two children.

4) My employer pays $1000.00 per year into the HSA, which makes it even more attractive.

5) We've been pretty healthy since I took this job, so we have not been using up our deductible. Combined with the fact that we have contributed the maximum allowed by law each year, this has resulted in a total balance in the account of $13,000.00 after only 3 years and 3 months! :eek: I'm viewing this as an emergency health care fund in case I am laid off. I'm pretty sure I can use this account to make Cobra payments or pay other health care premiums, but I'm not sure on that point.

6) Through the paperwork related to changing HSAs this year I have learned that we will need to pay a maintenance fee on the account if my employer stops paying it (such as if I'm laid off).

7) The HSA is useful to pay for non-covered medical expenses. For instance, I have used this HSA to get laser eye surgery a couple of years ago. We may use it to pay for some orthodontia in the future.

8) For some coworkers with large medical expenses, it is not as great a deal. Still, with the lower premiums, pretax deductible payments and $1000.00 up front from our employer, it's pretty hard to beat.

 

All that said, I have no doubt that the PP is correct when she said the government is about to reach into this pot and help themselves. They've spent way more than we could afford over the past few years (decades?). But I'm more concerned that they will go after the much larger pot of gold AKA our 401k plans.

 

Good luck with your decision!

[Alice]

We have one with Blue Cross Blue Shield and we like it a lot.

 

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One thing to be aware of, however, our last HSA sent tax papers at the end of last year that we had to file with our taxes as potential income. We had to sign a statement saying that the money we removed from the account was used for medical expenses and supplies not otherwise covered by our insurance for it to not count as income (our accountant had us do this). It must be a new law or something because we had never receoved papers like that in the past. But, since last year was a heavy medical expense year it wasn't an issue.

 

If you use Turbo Tax the tax stuff is easy to figure out with the HSA. It told me what to input and figured it wall out for me.

 

The only bad....you get one credit card per couple. DH picks up all prescriptions because the card is in his name. If I must pick something up while he is at work, then I must pay out of pocket rather than our HSA.

 

 

 

We also only have one debit card in dh's name and a checkbook also only with his name on it. You are allowed to reimburse yourself though from the HSA if you pay for something that is covered with your regular card. So if I pick up a presciption and pay with our regular bank account card, dh then reimburses us through the HSA.

[LittleIzumi]

We have a flex plan... but it's totally separate from our health insurance. It's just pre-tax dollars set aside for medical expenses. I thought it was the same as a HSA but apparently not... But it rocks.

[RegGuheert]

A Flexible Spending Account (FSA) is a use-it-or-lose it pre-tax plan for certain types of expenses. A Health Savings Account (HSA) is an account where you can deposit a limited amount of pre-tax money to pay for medical-related expenses ONLY. The balance in an HSA does NOT go to zero at the end of each calendar year like that of an FSA.

 

That's my understanding, anyway. Please correct me if you see any mistakes.

[Classical Country Mama]

Thanks so much to everyone for your helpful responses. After much internal anguish (it's that high deductible, knowing I'm having a baby in April), we just now sent our forms in for the HSA. In the end we think it'll still save us at least $1500 over the "gold" plan, though it may mean a bit more of a headache at the beginning.

 

I really appreciate all your help. Thank you!

[RegGuheert]

Even if it doesn't save you money *every* year, if you have one or more good-health years, you then are saving up a cushion that can apply to subsequent years. In other words, when you are healthy you are paying the extra money to YOURSELF rather than to the SYSTEM.

 

I hope it all works out for your family!

[Karen_OK]

We've had good experience with HSA's. My husband's company even makes a generous first-of-the-year deposit in the account to encourage people to use the HDHP. Unexpectedly, we've actually met our out of pocket maximum for two years in a row. The timing of how things happened made it impossible to choose any other option, but according to my husband's calculations, we still came out ahead because of the tax breaks. Once we did meet the out-of-pocket maximum, it's been a blessing to have everything covered at 100%. We also have an FSA, but those are hard to plan for and we have to meet our deductible (not the entire out of pocket max) before we can use any money from that account. We chose the HSA again for next year. Hopefully, we'll be able to start accumulating rather than spending it all.

[LittleIzumi]

A Flexible Spending Account (FSA) is a use-it-or-lose it pre-tax plan for certain types of expenses. A Health Savings Account (HSA) is an account where you can deposit a limited amount of pre-tax money to pay for medical-related expenses ONLY. The balance in an HSA does NOT go to zero at the end of each calendar year like that of an FSA.

 

That's my understanding, anyway. Please correct me if you see any mistakes.

 

Oooh, rollover money. But it has deductibles, from what I'm reading here. Interesting....

[RegGuheert]

 

Oooh, rollover money. But it has deductibles, from what I'm reading here. Interesting....

Well, the HSA itself doesn't have deductibles. It's just that when you have an HSA, you typically (always?) also have a high-deductible health-care plan (with lower premiums). So the most common use for money in an HSA is to pay your deductible. As mentioned, it can be used for most types of health-care expenditures, not just deductibles.

[*LC]

Does anyone that have a HSA on a self-financed policy, not from an employer-sponsored plan?

 

I am looking at new health insurance for our family for next year. We do not get a policy from work, and we buy it ourselves. I see mixed thoughts on whether HSA contributions are tax-deductable if you are self-employed. Anybody have experience with this? It is strange because the plans are more expensive than the other quotes I have received. However, in some ways they have better benefits. In other areas, they do not have as good benefits. My head hurts trying to figure it out.

 

Thanks

[Heather in WI]

Does anyone that have a HSA on a self-financed policy, not from an employer-sponsored plan?

 

I am looking at new health insurance for our family for next year. We do not get a policy from work, and we buy it ourselves. I see mixed thoughts on whether HSA contributions are tax-deductable if you are self-employed. Anybody have experience with this?

 

 

My husband owns a small construction company. We have an HDHP with a HSA for our family and one employee through Humana. We LOVE it! They are very helpful and we have saved a lot of money in the past two years since we started it.

 

From my understanding, it is tax deductible on our personal deductions, but not our business deductions. Don't quote me on that though. We have an accountant and she does all of our business and personal tax stuff.