Health Insurance Questions (Individual plan vs. employer's plan) - Tilted Forum Project Discussion Community

kutulu · 11-19-2004, 02:27 PM

I'm having a similar issue. My provider that my company uses (a PPO) have had some extreme rate increases. Coverage for me, my wife, and our newborn is 1,166/mo. After the portion that my employer pays, my responsibility is about 640/mo (more than what I pay for rent). Our deductibles are 500/1500 (network) and 1500/3000 (non-network).

Now they are looking into a plan with the same provider with really high deductibles (2500/5000 ded, 2000/4000 out of pocket). My portion of the premium would be 402/mo. If you look at the premium only, it seems great but the difference in the deductibles are huge. To counter this, they would offer what is called a "Health Savings Account" (HSA) I'd contribute as much as I wanted (tax free) and that money can be used to cover the heathcare costs that insurance doesn't cover.

This works if you have the money in there but until that money is in there you are fucked if something happens because of the high deductibles and out of pocket expenses. If I wanted to get to the point where my deductibles and out of pocket expenses were the same in the event of an emergency, I'd need to put up to $9,000 dollars into my HSA. If I only put in the difference between the two plans, it would take four years to get that much money in my HSA.

Obviously, myself and the other employees were not happy with this. The plan costs us less per month but unless we put in a lot of our own money we'd be screwed if anything ever happened. It's basically the company lowering their costs at the expense of the employees.

I started looking into individual plans. One company I came across was health.net. It is also a PPO with the close to the same deductibles, out of pocket, coverage rates of the plan we currently have (the low deductible plan). The only difference in out of pocket expenses seem to be copays that are slightly higher. There is a huge difference in the premiums though. Based on their rate sheets, I can cover myself, my wife and our newborn girl for about $424/mo.

Something seems wrong here because the rates from health.net seem way too low. I'd be paying $424/mo for a plan that is almost the same as the plan that my employer and I pay almost $1200/mo (640/mo for me). The rate sheets say nothing about how the rates are subject to underwriting.

It could be possible that the woman running our HR department isn't doing a good job finding good care for a good price but it just doesn't make sense.

Has anyone dealt with health.net? Any advice?

gar1976 · 11-19-2004, 07:07 PM

HSA's are specifically designed to be implemented with high-deductible health plans. They're more flexible than you think - check with your HR department about all the benefits of them.

LIMilf · 11-20-2004, 05:59 AM

Quote:

Originally Posted by gar1976

HSA's are specifically designed to be implemented with high-deductible health plans. They're more flexible than you think - check with your HR department about all the benefits of them.

You also might want to check with those HSA's to see what happens to your money if you don't spend your allocation throught the year. We just had a meeting about this at my work, and if you dont use all your money at the end of the year, you lose it.

kutulu · 11-22-2004, 09:56 AM

I checked further into the benefits offered by health.net. Their PPO doesn't cover maternity care. Not one fucking cent. It figures. I'll have to stick with my employer policy. I expressed my distrust of the HSA plan but I think it fell on deaf ears and eyes covered by dollar signs. My employer covers 75% of the employee cost and 25% of dependant cost. Switching to the high deductible plan would save them 2/3 of their monthly costs.

LIMilf:
Supposedly, this HSA lets you keep all the money you put into it with no risk of losing it. I still hate the idea because it is a gamble. Our deductibles would be 2500 ind/5000 fam and teh out of pocket would be 2000 ind/4000 fam. Right now we have a 500/1500 ded and 1500/3000 out of pocket. This means that our maximum annual responsibility would be 4500/9000 vs a current max of 2000/4500, a difference of 2500/4500.

The high deductible plan saves me 200/mo. If I take all of that savings and put that in my HSA account it would take me 13 months to make up that difference for the individual expenses and another 10 months to get 4500 in the account. That's almost two years. Only then can I stop putting money into my HSA and start enjoying the reduced rates. I also have to hope that in the next two years we will have no emergencies that require us to go to the hospital. Furthermore, we will probably have another child in that time so we'll end up using that money and I'll have to start over again.

The only people being helped out by this would be the the owner and his wife. All the employees see this and they are all pissed.

braisler · 11-22-2004, 10:19 AM

Quote:

Originally Posted by kutulu

Supposedly, this HSA lets you keep all the money you put into it with no risk of losing it. I still hate the idea because it is a gamble. Our deductibles would be 2500 ind/5000 fam and teh out of pocket would be 2000 ind/4000 fam. Right now we have a 500/1500 ded and 1500/3000 out of pocket. This means that our maximum annual responsibility would be 4500/9000 vs a current max of 2000/4500, a difference of 2500/4500.

The high deductible plan saves me 200/mo. If I take all of that savings and put that in my HSA account it would take me 13 months to make up that difference for the individual expenses and another 10 months to get 4500 in the account. That's almost two years. Only then can I stop putting money into my HSA and start enjoying the reduced rates. I also have to hope that in the next two years we will have no emergencies that require us to go to the hospital. Furthermore, we will probably have another child in that time so we'll end up using that money and I'll have to start over again.

The only people being helped out by this would be the the owner and his wife. All the employees see this and they are all pissed.

You are right that your employer is benefitting by offering an HSA plan, but you may realize more benefits from it yourself as well. All insurance is a gamble. You are betting that you are going to get sick or need care. I realize that you have to examine the situation from a worst-case-scenario point of view, but really, are you likely to spend $9000 in the next year on health care for you and your family. If you are young and in good health, the answer should be no. Hopefully you will all continue to be in good health and the only visits to the doctor will be for annual check-ups. That might run you just a few hundred dollars.

You mentioned that you are planning on having another child soon. This is an expense that you can plan for. If you put money into your HSA, it goes in tax free. That is an immediate bonus! If you are like most people, you are currently paying your medical deductibles with after tax dollars. Only if you incur some serious medical bills are you able to claim a deduction.

The real benefit of HSAs is that they use pre-tax earnings and they basically act as an IRA if you don't use the money. You mention that it will take you a certain period of time until you have enough money in your HSA that you can stop making contributions to it. Why would you ever stop making contributions to it?!?! Once you have enough money in the account, you can use it as a secondary investment account and grow the money that you are now giving away to an insurance company. You would be in control of your health care dollars in a very powerful way.

The decision is yours to make of course, but if my employer offered an HSA, I would jump at it in a second.

11-19-2004, 02:27 PM	#1 (permalink)
kutulu Junkie	Health Insurance Questions (Individual plan vs. employer's plan) I'm having a similar issue. My provider that my company uses (a PPO) have had some extreme rate increases. Coverage for me, my wife, and our newborn is 1,166/mo. After the portion that my employer pays, my responsibility is about 640/mo (more than what I pay for rent). Our deductibles are 500/1500 (network) and 1500/3000 (non-network). Now they are looking into a plan with the same provider with really high deductibles (2500/5000 ded, 2000/4000 out of pocket). My portion of the premium would be 402/mo. If you look at the premium only, it seems great but the difference in the deductibles are huge. To counter this, they would offer what is called a "Health Savings Account" (HSA) I'd contribute as much as I wanted (tax free) and that money can be used to cover the heathcare costs that insurance doesn't cover. This works if you have the money in there but until that money is in there you are fucked if something happens because of the high deductibles and out of pocket expenses. If I wanted to get to the point where my deductibles and out of pocket expenses were the same in the event of an emergency, I'd need to put up to $9,000 dollars into my HSA. If I only put in the difference between the two plans, it would take four years to get that much money in my HSA. Obviously, myself and the other employees were not happy with this. The plan costs us less per month but unless we put in a lot of our own money we'd be screwed if anything ever happened. It's basically the company lowering their costs at the expense of the employees. I started looking into individual plans. One company I came across was health.net. It is also a PPO with the close to the same deductibles, out of pocket, coverage rates of the plan we currently have (the low deductible plan). The only difference in out of pocket expenses seem to be copays that are slightly higher. There is a huge difference in the premiums though. Based on their rate sheets, I can cover myself, my wife and our newborn girl for about $424/mo. Something seems wrong here because the rates from health.net seem way too low. I'd be paying $424/mo for a plan that is almost the same as the plan that my employer and I pay almost $1200/mo (640/mo for me). The rate sheets say nothing about how the rates are subject to underwriting. It could be possible that the woman running our HR department isn't doing a good job finding good care for a good price but it just doesn't make sense. Has anyone dealt with health.net? Any advice?

11-19-2004, 07:07 PM	#2 (permalink)
gar1976 Custom User Title Location: Lurking. Under the desk.	HSA's are specifically designed to be implemented with high-deductible health plans. They're more flexible than you think - check with your HR department about all the benefits of them. __________________ Blistex, in regards to crappy games - They made pong look like a story driven RPG with a dynamic campaign.

11-22-2004, 09:56 AM	#4 (permalink)
kutulu Junkie	I checked further into the benefits offered by health.net. Their PPO doesn't cover maternity care. Not one fucking cent. It figures. I'll have to stick with my employer policy. I expressed my distrust of the HSA plan but I think it fell on deaf ears and eyes covered by dollar signs. My employer covers 75% of the employee cost and 25% of dependant cost. Switching to the high deductible plan would save them 2/3 of their monthly costs. LIMilf: Supposedly, this HSA lets you keep all the money you put into it with no risk of losing it. I still hate the idea because it is a gamble. Our deductibles would be 2500 ind/5000 fam and teh out of pocket would be 2000 ind/4000 fam. Right now we have a 500/1500 ded and 1500/3000 out of pocket. This means that our maximum annual responsibility would be 4500/9000 vs a current max of 2000/4500, a difference of 2500/4500. The high deductible plan saves me 200/mo. If I take all of that savings and put that in my HSA account it would take me 13 months to make up that difference for the individual expenses and another 10 months to get 4500 in the account. That's almost two years. Only then can I stop putting money into my HSA and start enjoying the reduced rates. I also have to hope that in the next two years we will have no emergencies that require us to go to the hospital. Furthermore, we will probably have another child in that time so we'll end up using that money and I'll have to start over again. The only people being helped out by this would be the the owner and his wife. All the employees see this and they are all pissed.