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This will not completly answer your question, but I thought I would throw my experience out there. This is the first year that I did the HSA and wasn't sure how it would stack up to the PPO plan ($1500 deductable 90/10 plan) that my company offered ($400 / month = $4800 / year) . So I decided to contribute to my HSA the exact amount over thye year I would have paid for premimums which is $4800 for 2009. Note that with my HSA the deductable is $3000 for a family and prescription drugs and doctor visits (normally just a copay on a regular plan) all go toward the deductable first. But all preventative vists are no cost to me.
A little background, I have a wife that goes to the doctor for various issues and has 3 perscription drugs she refills every month. I also have a 14 month old daughter that goes to the doctor for various checkups and shots so we by no means avoid the doctor, which is key here since I have always been told that HSA's are for those that never get sick.
So as of 10/28/08 I still have $500 in my HSA account with no pending claims and another $800 that will be deposited in the next 2 months. I have hit the $3000 deductable so prescriptions and doctor visits are as they used to be with a regular PPO plan.
Baring anything major happening, I should end up paying less for the HSA than I would have with the PPO since the PPO has $4800 in premiums not including the $1500 deductable and standard copays and co-insurance I would have paid with all the medical stuff we have done so far this year. That balance in my HSA will just roll over for use next year which is sitting at Alliant Credit Union's HSA earning 3% APY.
So as a result I am definetly going to look at doing this again. Hope this helps. I am hoping that I can use next year to gage how much I should actually put into the HSA since $4800 is looking like it was too much, but I needed to do this as a comparison the HSA to the PPO plan.
You mention "HSA" and "flexible spending account" in the same sentence as if they're the same thing. They're not.
Health Savings Account (HSA) = account that accompanies a high-deductible insurance plan, where you can accrue money tax-deferred (tax-free if used for health purposes) for years.
Flexible Spending Account (FSA) = account that lets an employee, regardless of insurance plan, put pre-tax money in an account to pay out-of-pocket medical expenses. If not used up by the end of the year, you forfeit the balance.
If you mean an HSA, then the more you contribute, the more you'll save on taxes. Well, actually, the same thing is true for an FSA, although the tax savings aren't worth it if you won't use up the money.
ThePessimist said:You mention "HSA" and "flexible spending account" in the same sentence as if they're the same thing. They're not.
Health Savings Account (HSA) = account that accompanies a high-deductible insurance plan, where you can accrue money tax-deferred (tax-free if used for health purposes) for years.
Flexible Spending Account (FSA) = account that lets an employee, regardless of insurance plan, put pre-tax money in an account to pay out-of-pocket medical expenses. If not used up by the end of the year, you forfeit the balance.
If you mean an HSA, then the more you contribute, the more you'll save on taxes. Well, actually, the same thing is true for an FSA, although the tax savings aren't worth it if you won't use up the money.I agree. For an FSA, put as much as you will spend in it and not a dollar more. For a HSA, max it out. Worse case, if you don't use the money for medical expenses ever (which would make the money free of income taxes completely), you can take it out during retirement where it functions like an IRA (or is tax free to the extent you have qualifying medical expenses).
My employeer puts in $500 into your HSA each year if you choose that option. Is this pretty standard or a real "perk" compared to most plans? (This $500 does count against your yearly max so I can only contribute $2550).
With the plans offered at my work, I could not find a single scenario where the high deductible plan with HSA would end up costing me more total than the traditional PPO and HMO plans. Plus, HSA's just kick ass.
cheezedawg said:With the plans offered at my work, I could not find a single scenario where the high deductible plan with HSA would end up costing me more total than the traditional PPO and HMO plans. Plus, HSA's just kick ass.
Same boat here. I had this girl at work add up her medical visits and it turns out she paid $700 more for the PPO plan than she would have with a HDHP
quizzer25 said:For a married person with annual salary 100K (deductions = 5), what should be the ideal amount to be put in HSA (flexible spending account)?
Next year's premiums has increased considerably and am trying to see if by contributing to a HSA (employer sponsored) can save me some money.
Appreciate your thoughts!
HSA does not equal flexible spending account.
HSA = health savings account. You can put money and NOT spend in current year, and roll over to future years, and spend in the future. Money sits in some kind of an yield earning account. Contributions are tax free, interest and yield is tax free, and you spend the money ONLY on medicate expenses, but tax free.
Flexible spending account sounds like one of those "use it or lose it" tax-deductible reimbursement plans.
If you have the means, you should max out the HSA. It is basically tax-free money, more or less.
On the other hand, if you have planned expenses, you might not want to get a high deductible plan at all. A high deductible plan is a requirement for HSA.
daugenet said:cheezedawg said:With the plans offered at my work, I could not find a single scenario where the high deductible plan with HSA would end up costing me more total than the traditional PPO and HMO plans. Plus, HSA's just kick ass. Same boat here. I had this girl at work add up her medical visits and it turns out she paid $700 more for the PPO plan than she would have with a HDHPI did a spreadsheet last year confirming the same result. The important thing is with HDHP do not ration yourself out of necessary medical expenses now that they appear to be out of pocket expenses. Other than that, it seems like one of those "free lunches".
Check with your employer to determine if they permit a ten-week grace period at year's end to spend down the FSA account. For example, I have until mid-March 2010 to spend down my 2009 FSA account. The income tax reduction remains with 2009.
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