Experiences and thoughts on HDHP - High Deductible Health Plan?

[WatchingThemGrow]

DH starts a new job next week. He needs to decide if we will enroll in the regular deductible plan ($3100/yr premiums, $500 deductible, then 90% paid) or HDHP (http://en.wikipedia.org/wiki/Hdhp) (no premiums, $3000 deductible, then 100% paid).

I'd never heard of it until our date Fri night at 10 pm. Does anyone have it? What do you think? What are your experiences and how has it worked for your family?

Notes for our family...no more babies, one DC has pre-asthma type stuff w/nebulizer and those meds, one DC just started speech therapy, and one has funky skin that may be seen by a dermatologist this year. Other than that, I go to the derm. 1-2x/yr, plus we all do regular check ups. Vision and Dental are extra - and on traditional plans.

[sewarsh]

Ok, so for your particiular situation i think it definately makes sense to do HDHP because with the reg plan you are GUARANTEED to pay $3100 NO MATTER WHAT. with the HDHP you will pay $3k at max. Just know that it will be hard to swallow taking your kids to the pedia and getting a $200 bill 2 weeks later. Or if they need to get a poop culture, you'll get a $169 bill for that in 2 weeks. In other words, its hard to swallow those large bills once they start flowing in (becuase you have to pay them in full until you reach $3k), BUT do not let it sway you from taking your kids or yourselves to the doctor if you need to go. I think that's why they are popular....people tend NOT to go to the doctor as much as they would under the other plans becuase they pay for it, understand??

I quit my job in April. We were paying $190 family a month in PPO. For the same plan under my DH job it was $390 a month. The HDHP was $180 so a $200 a month savings * 12 mo = $2400 guaranteed savings. His employer through in $1k to the FSA to make it $3400 savings. Ours is a $3k indiv deduct and $5k family deduct so your's is WAY more attractive. We signed up for it adn now i'm prego. Each dr. visit is covered, but every fricken single test, ultrasound, glucose, quad screen, etc etc. is billed directly to me...OUCH! To make matters worse, i'm due in 2011 so my $3k WON't carry over until 2011. STINKS. so i'll end up paying it 2x (i think, still have to call Aetna to clarify). Anyways, we are getting $3400 in savings, so that's how we justify it. if you aren't having more babies and no long-term illnesses or surgies exist, you should dfeinately do HDHP.

[o_mom]

I also think the HDHP makes more sense here. You will pay $3100-3600+ on the first plan. Premium plus deductible... maybe copays as well if it has those AND prescriptions are usually counted toward the deductible in a HDHP, so add on all the meds. What's the max out of pocket on the first one?

You should be able to set up a medical savings account to go with it, either through your employer or on your own. You can contribute pre-tax dollars to it to help with the costs. If you put the amount in monthly that you would have paid in premiums, you will cover the deductible. Once you have a bit built up, the larger bills coming in are not as bad. Also, many providers are very aware of the HDHP and will set up payment plans so that you can pay them as the money comes into your savings account.

[WatchingThemGrow]

ok, those are some of the same thoughts we were having about it. DH is going to find out about when the fiscal year starts for the HDHP to determine if having it Aug- Dec. is worth it, assuming a 1/1 roll-over.

I think having that built-up savings is crucial b/c otherwise we'll be mentally freaking out with the cash-flow part. Hmmmm....where to find that $3k, lol. I guess calling around to some of our providers will be in order. I feel like I need to know how they work it.

Do you go kinda crazy managing the HDHP? DH felt like it was a lot of work on his end, managing the cash flow part.

[g-mama]

wow, I never realized my husband's law firm put us on an HDHP before there was even a name for it, LOL. Our premiums are $700/month AND we have a $3000 deductible AND we have a $40 co-pay! Ugh. I guess if the idea is for people to go to the doctor less, it's working. I REALLY think twice now.

[BillK]

Remember - your High Deductible plan deductible is typically PER PERSON - not total for family (my experience at least - your health plan deductible is a per person thing not a total family one). So if you have a $3k Ded - with a family of 4 - you probably really have $9k in deductibles (usually the "family" deductible is capped and 3x regardless of family size).

The high deductible plan was created with the idea that those choosing it would also open a HSA/MSA to use for paying the high deductible. A lot of people don't do that then are bummed that they pay damn near every medical billing they get out of pocket. Unless you have a lotta bank - or have opened a HSA I'd shy away from a high deductible plan.

The basic coverage of a high ded plan is very much similar (if not the same) to most of the lower deductible traditional plans.

[sewarsh]

Remember - your High Deductible plan deductible is typically PER PERSON - not total for family (my experience at least - your health plan deductible is a per person thing not a total family one). So if you have a $3k Ded - with a family of 4 - you probably really have $9k in deductibles (usually the "family" deductible is capped and 3x regardless of family size).

The high deductible plan was created with the idea that those choosing it would also open a HSA/MSA to use for paying the high deductible. A lot of people don't do that then are bummed that they pay damn near every medical billing they get out of pocket. Unless you have a lotta bank - or have opened a HSA I'd shy away from a high deductible plan.

The basic coverage of a high ded plan is very much similar (if not the same) to most of the lower deductible traditional plans.

I just checked ours and its $2400 indiv/$4000 family.

[KrisM]

We have a $3000 deductible and then then pay 80%. Some things are 100% covered still - all well child visits and vaccinations and 1 physical for each adult per year. On a non-baby-having year, we pay about $300 out-of-pocket. It did cost us $3600 or so to have DS2, but we did a FSA for that.

Will you have an FSA? We do and it's through our insurance company, so we take out $250/year for that and any payments we'd have to pay are automatically taken out of FSA before we ever get a bill. It makes managing it really easy.

[Green_Tea]

We have a high deductible health plan. Our deductible is $5500/year for the family, and our premiums are about $350/month. After we reach our deductible all visits are covered at 100%, but we still have to pay co-pays on prescriptions ($10-50, depending on the script).

Although we do save some money by being on the plan, it's an enormous source of stress for us each year. Our DD has asthma which lands us in the ER at least 2x a year, and DS is pretty accident-prone, so he's also in the ER at least once a year. ER bills can be very big. When DD2 had ear tubes removed, we got a bill for $2500. If you or your child requires any special tests (like an MRI), the bills for that can also be quite high.

Unless your DH's take home pay allows you to really sock it away to meet that deductible without accruing debt (ie: charging things you might have otherwise paid cash for so that you can pay medical bills instead), I would stay away from HDHPs. We little choice about our health care because my husband works for a very small company. I'd give my right arm for a good old fashioned HMO.

[jjordan]

Often you can pair a high deductible health plan with a health savings account, where you can save pre-tax money for health expenses. Unlike an FSA, where you need to use all the money each fiscal year, you can roll over the HSA money from year to year.

[WatchingThemGrow]

Unless your DH's take home pay allows you to really sock it away to meet that deductible without accruing debt (ie: charging things you might have otherwise paid cash for so that you can pay medical bills instead), I would stay away from HDHPs. We little choice about our health care because my husband works for a very small company. I'd give my right arm for a good old fashioned HMO.
Ugh. That's hard. I'm sorry it has not been an easy plan for you and that you have no choice.

If we were able to have that $3K account in place (money that would otherwise be tagged as downpayment funds) would it be more palatable? To answer some of the other points brought up, DH says our deductible would be $1500 individual, $3000 family. The premiums will be picked up by the small company. He believes we can set up an HSA through our credit union. We usually transfer funds between accounts online late at night/early in the morning, so we can manage the cashflow relatively easy.

Do those factors make it more of a good fit?

[niccig]

We swapped to a health plan that has a higher deductible than previous years. It is a shock to get bills from the Dr.

I think high deductible insurance plans, whether it is health/car/house work best when you have the deductible amount in some sort of savings account. Less stress when you know the money is there for a bill over WTH are we getting $2K from to pay a bill.

If you do go with this plan, I would save the difference between the premiums and put it in a bank account. Once you've reached the deductible amount, you can stop until you use some of it.

[secchick]

I love our HDHP. But then, I pay $26/month premium for family coverage, $2500 family deductible, and 5K OOP max. The difference in premiums, plus the $1K the Company puts in the HSA, plus the deductible under the PPO, means that the max OOP I would pay under the HDHP is never more than I would pay under the traditional plan, and the difference in premiums and HSA contribution completely cover the family deductible. So chances are you will come out ahead if you put the premium difference into the HSA. This is our first year and we tried it because the company did away with the $300 deductible plan and the permiums for the $700 deductible plan were higher than the $300 had been. We are maxing out the HSA to carry forward to future years and for the tax savings (since who knows how long we'll be able to shelter that income).

[o_mom]

ok, those are some of the same thoughts we were having about it. DH is going to find out about when the fiscal year starts for the HDHP to determine if having it Aug- Dec. is worth it, assuming a 1/1 roll-over.

I think having that built-up savings is crucial b/c otherwise we'll be mentally freaking out with the cash-flow part. Hmmmm....where to find that $3k, lol. I guess calling around to some of our providers will be in order. I feel like I need to know how they work it.

Do you go kinda crazy managing the HDHP? DH felt like it was a lot of work on his end, managing the cash flow part.

I think there are many questions to ask, especially with a mid-year switch. One of the attractive parts of these plans is the HSA. For us, it is/was a gamble that they are going to offer the plan beyond this year because we may or may not come out ahead after just one year, but have the potential to. OTOH, the potential downside is pretty much a wash - worst case, we didn't spend any more than the regular plan, best case we come out ahead and have money to roll over to next year. With the traditional plan, we had to guess every year on the FSA (you can find my post of how to blow through a large amount left in there in December).

When we switched to it this year, we put the max allowed into the HSA directly out of DH's paycheck. This was approximately the same amount as our premiums + FSA contribution had been before on the traditional plan, so it wasn't a big change in cash flow. We kind of crossed our fingers that we would not have any major bills until after the balance had built up a bit. If we had, we would have either paid it out of savings and then been reimbursed later or set up a payment plan - most of the hospitals around here have a no interest payment plan that is available to any one regardless of income and even our doctor's office offered payment plans on a balance of a few hundred dollars. As money is deposited in the HSA, you can take it out to make payments. Knowing about, and taking advantage of, these programs or having the savings is key to not putting it on a credit card, etc.

Compared to the traditional plan - we found small differences in the way the accounting toward deductible works. The traditional plan was a $X per person, $3X per family style. So if the per person was $500, the family was $1500. An individual could get to the % benefit after $500, but the second person would have to meet their $500, etc. until you reached $1500. This was only for benefits that were not 'copay' items. So, doctor visits, prescriptions, etc. didn't count to the deductible. If you had a chronic issue that required $30 copay visits every month, none of that counted to the deductible or out of pocket.

The HDHP we have, OTOH, has a flat $3000 deductible for the whole family (it is $1500 for a single person, $3000 for 2 or more). The entire deductible has to be met to have any benefit outside of a select list of preventative care (vaccinations, well-child, one well-adult visit, mammogram, etc.). Everything else counts to the deductible - prescriptions, doctor visits, etc. We still get the insurance discount, so the amount we pay for a doctor visit is the 'amount allowed' you typically see on the EOB. Same with prescriptions - you get the 'insurance price', not full retail.

One thing that is nice about your plan is the 100% benefit after the deductible. Ours is 80/20 after the deductible up to the out-of-pocket limit. With that benefit, you have pretty much a hard cap on expenses and once you reach that you don't have to worry about much at all. I know several people with a plan like that and for the last few years, they have met the deductible pretty early in the year so they then try to squeeze everything into the rest of the year so they can have it covered (not how it was envisioned to work, I'm sure).

So far, it has worked well for us - we are about halfway through the deductible and have a surplus in the HSA, so as long as we don't have a major medical issue (knock on wood) before the end of the year, we will most likely come out ahead with enough of a cushion for next year's deductible. We average at least one ER visit a year, though, but even factoring that in, we were still likely to come out ahead.

I haven't found the paperwork to be too bad - HSAs don't require paperwork for withdrawls, like a FSA does. You just make the withdrawl and then make sure you have an EOB to document it if you are audited.

[WatchingThemGrow]

wow, such good info! thanks for explaining. FIL just called, worrying about it, so DH is trying to explain it. He's an economist, so he's probably been thinking about this all night.

So...I wonder if there's an App for calculating all this stuff.

We have Sep-Dec (4 mos) on it if we sign up now. Would we just suck it up and hope we come out less than the $1040 we would be paying otherwise in premiums? I guess we'd put that money in the HSA now, then draw it out as needed?

Practically, what did you label the folders to hold all the paperwork, lol.

[o_mom]

I'll bet you could find a calculator somewhere, but it's all in those little details of what counts on one plan vs. the other so it may be easier to make a spreadsheet.

If you switched now, I would say save the premium difference for sure and anything else you might have been contributing to a FSA - maybe even add a little bit more if possible so you can start the next year with a balance already.

We have our usual insurance EOB folder, then an account statement folder for the HSA. We balance the statements through Quicken. For some things we pay directly from the HSA with the debit card - prescription, for example - when we know the amount is going to be correct. Bills from the doctor we usually pay by check after the EOB is correct and then do an online transfer from the HSA to the checking account. We are planning on printing a year-end statement and then attaching copies of all the EOBs to them. It's our first year, so I'm not completely refined on all the details yet. :)

[sewarsh]

wow, such good info! thanks for explaining. FIL just called, worrying about it, so DH is trying to explain it. He's an economist, so he's probably been thinking about this all night.

So...I wonder if there's an App for calculating all this stuff.

We have Sep-Dec (4 mos) on it if we sign up now. Would we just suck it up and hope we come out less than the $1040 we would be paying otherwise in premiums? I guess we'd put that money in the HSA now, then draw it out as needed?

Practically, what did you label the folders to hold all the paperwork, lol.

Honestly, it seems like a no-brainer to me. I think your family should definatley do the HDHP especially since you can participate in the HSA. Good luck. I know its a tough decision. We just went through the same thing a couple of months ago.

[lchang25000]

Often you can pair a high deductible health plan with a health savings account, where you can save pre-tax money for health expenses. Unlike an FSA, where you need to use all the money each fiscal year, you can roll over the HSA money from year to year.

:yeahthat: That's exactly what we have...a HDHP + HSA. DH puts in the max into the HSA with every paycheck and his clinic matches. The linked HSA helps tremendously if that is an option for you.

[scrooks]

We had a HDHP for about 3 years when we were on my benefits. It worked really well for our family. I even had DS on the plan. In the end the premiums alone for a regular PPO were going to cost us more that the premiums plus the deductable on the HDHP. And I loved the fact that all well visits and shots were included and didn't count against you. I think we had about a $300 a month premium. The first $1000 of services were covered by our company and the next $1000 (the bridge they termed it) was covered by us after that $1000 was satisfied it was a traditional 90/10 plan with our max out of pocket being somewhere around $5000. The nice thing was if you didn't use the $1000 the company provided you could roll it over into the next year and use it to cover your bridge- which is exactly what we were able to do the year I had DS! We are now on my husbands 80/20 ppo and I miss the old plan.

Oh- and definitely go with and HSA if you can!

[AnnieW625]

I would first look and see what plan has the drs. you want, then I would look at how much you spent last year on medical care (without the birth of DS2 because that wouldd skew tings for the future year) and then go from there. Either way I would look at the options for the HSA.

We really need to do the HSA because we never have enough medical dedeuctions to write off as we HMO that covers everything.

[baileygirl]

Ours also covers well visits/vaccines/well woman and anything done at the visits at 100%. Also, we get the insurance negotiated rates on anything we do pay, so that ends up being cheaper too.

[citymama]

Haven't read the other replies, but it's possible the HDHP will be better for your family. We have a plan that has a $2400 deductible, no premium or copays. My employer puts $1200 into my HSA, so that's half of it paid right there, and I have the other $1200 deducted from my paycheck pre-tax, so it really works out to a $800 out of pocket payment to have the entire family covered.

The only catch (that I discovered the hard way last month) is that there are two separate deductibles - one, for in-network providers ($2400/year) and the other, for out of network providers ($3000 a year!). We pretty much only use in network providers, but apparently the in-hospital pediatrician who attended when DD2 was born bills from his own practice, and so we were stuck with the full bill (a ridiculous amount, considering all he did was spend 15 minutes with us and her).

I had no idea about these two deductibles, since our previous plan (no deductible, $10 co-pay) covered 80% of out of network provider bills. So just make sure there's no fine print for out of network providers, or dental, or prescriptions or anything else!

[KHF]

I had a HDHP for a year. For us, it worked out OK initially. At my employer, open enrollment is mid-year, so our family had to pay a $4000 deductible from July to the end of the year, then start over in January. Ours was a $4000 total deductible, not a family deductible. So, it wasn't portioned out. We just paid $4000 and we were done. My DH gets Remicade infusions, so basically one of those and we were done for the deductible. He also has diabetes and Crohn's, so he's on several medications. With all of his prescriptions, plus the HSA and the $1000 my company put in, it worked well for us.

Until they changed the plan. This year, we were switching to a new plan that you paid your deductible up to $4000, and after that you were still responsible for co-pays on prescriptions (at $10-35-60) up to $8000. All benefit for us went out the window. So we had to go back to a regular PPO plan. So, basically with the 2 sets of deductibles I had to pay because our plan switches mid-year, our little experiment into HDHP cost us all of our savings.

I will not ever go back on one, unless I'm forced to do so. I would say, if I didn't have a family and it was just me...it might be an OK idea. But, for our family, with all of DH's chronic conditions, it just won't work.

[brittone2]

Reading w/ interest. DH's work plan (not a high deductible plan) is 10K to add us on as a family as he is working for a rather small company. We are currently using COBRA from his previous job/school because for right now that's a better deal for us by far.

In the meantime we're investigating a higher deductible plan for ourselves. Got a few quotes and we may go that route (sock away the extra $$ in a separate account to use for medical bills as they come up).

I know one plan we are looking at gives an option for well child care, etc. to be added on for an extra $160 or so per month, so we'd have to weigh out that option too. By then DS2 will be over a year, so less frequent WBV anyway....may not be worth it. ER visits, etc. are covered at 100% which is important IMO with kids, obviously.

Anyway, listening in with interest.

[muskiesusan]

Our insurance switched to HDHP this year with three choices of varying deductible and co insurance amounts. To help in our choice, we were sent a summary of our health insurance costs the previous year; both the insurance company's costs as well as ours. Can you request something like this to help in your decision?

Our insurance only covers one physical per year for each of us. For everything else, we have a $4000 deductible and then $7000 in co-insurance (20% of bill) to meet until everything is paid 100%. We do fund a HSA and get the insurance negotiated rates for services.

It has been very interesting watching the bills come in and seeing how much everything costs. We are having a killer year with my pregnancy/delivery and medical stuff needed for DH and DS1, so we expect to meet our out of pocket maxs.

My DH works for a very large, multi-national company and this is what is offered. Unfortunately, I think these plans are the going to become the norm.

[n2ou]

We have had a HDHP for 3 years now. We have a very unique setup since dh's employer pays for the HDHP and funds the HSA also. :-)

I like it. Two years we had a ton of money left over, this year we bombed the HSA account with payments.

I wish the insurance companies would be more stable. I always knew this was true for traditional insurance, yet, I thought a HDHP plan would be more stable. Every year, my dh's company (small) has to renegotiate what they can get for their money. Deductibles keep on raising, adding co-pays, lowering 100% coverage to 80/20.

Keep this in mind when you make your decision.

[ILoveLucy]

DH starts a new job next week. He needs to decide if we will enroll in the regular deductible plan ($3100/yr premiums, $500 deductible, then 90% paid) or HDHP (http://en.wikipedia.org/wiki/Hdhp) (no premiums, $3000 deductible, then 100% paid).

If I'm understanding it correctly, I don't see why anyone would go with the traditional plan in this case. Already you'd be paying more per year with just the premiums of $3100 versus $3000 out of pocket on the HDHP, plus the $500 deductible and the 10% of everything after. I don't see any advantage to the traditional plan at all. With the HDHP, you pay $3000, then you're done paying as I see it.

[jk3]

If I'm understanding it correctly, I don't see why anyone would go with the traditional plan in this case. Already you'd be paying more per year with just the premiums of $3100 versus $3000 out of pocket on the HDHP, plus the $500 deductible and the 10% of everything after. I don't see any advantage to the traditional plan at all. With the HDHP, you pay $3000, then you're done paying as I see it.


I agree especially since you have 3 kids. If you have 100% coverage after the deductible, that's definitely the way to go.