Announcement

Collapse
No announcement yet.

HDHP HSA vs. PPO

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

  • #16
    Originally posted by DrRab View Post
    Jumping on this thread as I'm in a similar situation. Just found out wife is pregnant with our second. Currently on HDHP with HSA, but thinking of switching over to PPO plan. The HDHP pre-tax premium is $1400 per month (for employee and family) and the PPO plan is $2000. So a $6500 difference to start in terms of the premiums.
    Seems like staying with the HDHP may be the way to go given the large premium difference... am I missing something?

    Click image for larger version

Name:	Screen Shot 2020-12-06 at 4.48.57 PM (2).png
Views:	296
Size:	244.7 KB
ID:	242186
    Unless you are an owner it looks like your employer is putting all healthcare costs to you (the employee). Those monthly premiums are on par with the full monthly premium amount that the employer is likely paying. But yes, if you are 100% sure that your premium difference is $6500 then I'd stick with the HDHP. Even with the sheets you provided above. Has anyone brought this up with your employer re: health insurance premiums?

    Comment


    • #17
      As I am about to become partner in the group, I guess I will be one of the employers offering this insurance... I agree, it is not exactly optimal. The way the PPO plan is set up vs the HDHP makes me wonder in what scenario one would even benefit from the PPO. Went trough a rough estimate of numbers and with all costs calculated, it would be a several thousand $ difference in favor of the HDHP when all maternity costs had been accounted for.... And even then, the max individual OOP is $6k?!

      Comment


      • #18
        Ok, so we ended up keeping the PPO 250 plan last year, but now back in open enrollment and considering switching to the HDHP 3000. No babies planned for 2022. The health plans haven't changed. As a young family with no chronic illness, would expect typical well visits + possible emergencies for accidents etc.

        I'm still trying to wrap my head around a framework for comparing these plans. It's pretty complex.

        Just looking at premiums/contributions, The PPO 250 annual family premium is $5,000 vs. $3,700 for HDHP 3000, so that saves $1,300 right there. Then, employer contributes $2,000 so HDHP really starts off $3,300 ahead, which is pretty appealing. That doesn't factor in being able to make pre-tax contributions to reduce my taxable income and the tax free growth. I guess what's scary is in the first year, when the HSA is building, are the $6,000 family deductible and $12,000 OOP max. I realize it would take a "worst case scenario" accident or something to reach those maximums, but it's just way more than I'm used to paying for medical care having always had a PPO type plan. I think this is more of a frame of mind, than anything. We have a healthy emergency fund with very positive monthly cash flow, so in a pinch I think we could front the cash comfortably if we absolutely need to. Then, I realize as one sticks with the account, with ongoing employer + employee contributions, there'll be enough in there to cover the maximum amounts, and it'll only have the opportunity to grow. Plus the whole stealth IRA thing in the future.

        Am I thinking about this correctly? If I am, seems like HDHP is the way to go.

        Comment


        • #19
          Originally posted by RadOncD0c View Post
          Ok, so we ended up keeping the PPO 250 plan last year, but now back in open enrollment and considering switching to the HDHP 3000. No babies planned for 2022. The health plans haven't changed. As a young family with no chronic illness, would expect typical well visits + possible emergencies for accidents etc.

          I'm still trying to wrap my head around a framework for comparing these plans. It's pretty complex.

          Just looking at premiums/contributions, The PPO 250 annual family premium is $5,000 vs. $3,700 for HDHP 3000, so that saves $1,300 right there. Then, employer contributes $2,000 so HDHP really starts off $3,300 ahead, which is pretty appealing. That doesn't factor in being able to make pre-tax contributions to reduce my taxable income and the tax free growth. I guess what's scary is in the first year, when the HSA is building, are the $6,000 family deductible and $12,000 OOP max. I realize it would take a "worst case scenario" accident or something to reach those maximums, but it's just way more than I'm used to paying for medical care having always had a PPO type plan. I think this is more of a frame of mind, than anything. We have a healthy emergency fund with very positive monthly cash flow, so in a pinch I think we could front the cash comfortably if we absolutely need to. Then, I realize as one sticks with the account, with ongoing employer + employee contributions, there'll be enough in there to cover the maximum amounts, and it'll only have the opportunity to grow. Plus the whole stealth IRA thing in the future.

          Am I thinking about this correctly? If I am, seems like HDHP is the way to go.
          We recently had this discussion, as we are having a baby in the next year. However, the overall cost of premiums + possible out of pocket maximum was similar. What we also liked about the HDHP is that some of the money we are "spending" is ours to keep. We have been able to cash-flow our expenses, and we do have money saved for those "emergencies". I think with an overall healthy family without chronic illness, you benefit much more from the HDHP.

          Comment


          • #20
            Originally posted by NumberWhizMD View Post

            We recently had this discussion, as we are having a baby in the next year. However, the overall cost of premiums + possible out of pocket maximum was similar. What we also liked about the HDHP is that some of the money we are "spending" is ours to keep. We have been able to cash-flow our expenses, and we do have money saved for those "emergencies". I think with an overall healthy family without chronic illness, you benefit much more from the HDHP.
            Thanks for your reply. Glad we’re approaching this in a similar way!

            Comment

            Working...
            X