I'm sure it varies from plan to plan, but I am really struggling making the decision on which health plan to get.
I was excited when I learned that my new job was offering a High Deductible Health Plan so my family could get an HSA. I've heard they are incredibly powerful and my family is usually pretty healthy. I do have a young son who gets sick from school and stuff, but nothing crazy.
I was going to sign up for a HDHP for $658 per month with a family deductible of $4000. Covers pretty much everything once deductible is reached. [no contribution to HSA from company]
Then I noticed that the regular HMO plan is $733 per month. Family deductible is $750. Deductible does not apply to office visits, including sick visits. Sick visits have a co-pay of $20. Deductible really only applies for hospital visits.
The regular HMO plan is $75 more per month ($900 more per year).
I really have no idea what office visits cost with a HDHP. Does insurance still negotiate?
I was really looking forward to getting an HSA but I'm not sure if it's worth it? Does anyone have any experience or advice?
Posted by ms_blaze
23 Comments
I think hsa is only worth it if you know how to use it to its full potential. It may be useful to call uo your HCPs and just ask them if they accept the specific plan and what co-pay looks like so toy can get an idea of what to expect.
Do you go to the doctor often?
Does your company fund the HSA?
Are all of your providers in the HMO?
HMO is usually the least expensive option but you’re often severely restricted to which providers you use. If you’d use those providers anyway, an hmo can be great. If you’d need to use other providers, it can be a nightmare
HSAs are great if you don’t have any real chronic health concerns, which means you won’t really touch that money and just let it grow. I’m on a HDHP, and whenever I or my kid needs to see the doctor for a sick visit, I usually need to fork over $100+. If you’re only seeing the doctor a few times a year, the HSA may be worth it.
If the HSA wasn’t on the HDHP, would you still select it?
I find a HDHP/HSA is good if you don’t anticipate constant medical bills.
How prescription heavy is your family? You
may be paying higher if not full costs for scripts, so keep that into consideration. I recall paying < $20 for a temp prescription and it jumped to ~$1k when I switched to a HDHP.
Personally I would cap HSA considerations when it is only the couple involved. Including kids in the equation makes it too variable and unpredictable.
Does your employer offer any benefit for going with the HDHP? For example do they pay into the HSA? I would only consider the HDHP with a family only if the employer offset the higher costs by contributing some of their money.
Where I’m at the premium difference between HSA/non-HSA was NUTS – it was really expensive to have that low deductible. So the HSA was worth it. It looks like your difference might not be as great. It’d save you about $80 a month, if you have no healthcare expenses.
What are the max out of pocket differences? That’s another big thing to look at.
In addition to saving you $80 a month, you could max out your HSA and write off over $8K from your taxable income. Depending on your tax rate that is another good deal. And if you’re investing, you now get to invest that money to grow untaxed. That’s what a lot of us do – pay for our medical expenses out of pocket, keep those receipts forever, don’t touch the HSA money just invest it.
HSA makes sense for those that don’t see a Dr often. Its primarily used as an investment tool.
So it takes work on your part to manage the HSA in order for the money to make sense.
On my high-deductible plan a visit to my primary care is $40 and a specialist is $80. The deductible for me only really applies to services outside of a standard office visit like ER visits, imaging, some types of lab work, etc.
If you’re relatively healthy putting that $900/year into your HSA may end up working out in your favor long term as any money put into that HSA can be used tax-free at ANY age for qualified medical expenses — that money is yours to keep.
This will depend on how much you spend YoY for healthcare. The power of the HSA is contributing to it and letting it compound over the years paying all health expenses out of pocket. Only you can really answer if there is value in that for you. Though the cost of your hdhp is pricey. Ours is super cheap, its about 100 a month for 2 but the family deductible is around 6k i think. There have been a couple years i maxed out the individual deductible of 3k but overall its been great and for us its been worth it.
>The regular HMO plan
Do HMO plans have the same “medal” designations as PPOs? Because starting in 2026 all bronze level plans are eligible for HSAs regardless of their HDHP status.
eta: Answered my own question…they do!
I have to imagine that a regular bronze plan + HSA is going to be the best option in nearly all circumstances (for as long as this rule change exists) because you’ll get the tax-advantaged savings without going deep out of pocket first. So if the HMO plan is a bronze plan, and the *only* reason you’d get the HDHP is for the HSA, then HMO + HSA is probably the way to go.
Preventive care is usually fully covered on the HDHP before deductible so a lot of your standard care like an annual checkup and vaccines should be covered. Even some meds.
That said, sounds like your non HDHP plan is pretty good and not much more expensive so…. 🤷♂️
At its core, the tax benefits of an HSA are mainly intended to make an HDHP “suck less” compared to other insurance options. In some situations that can be leveraged for greater benefit. But it does boil down how the HDHP compares to the other options available to you, how much medical care your family will use during the plan year, and how comfortable you are about the risk of your guesses about the care being wrong. Your main focus should be on how the plans themselves compare for your needs (or estimates of needs), and let the tax advantages of an HSA act as bonus icing on that cake.
Under an HDHP, you do still get negotiated rates for things like office visits and tests when you use an in-network provider. Which (in theory at least) makes those cheaper than not having insurance at all. But a given visit might still cost hundreds of dollars, which is 100% your responsibility to pay (nothing paid by the plan) until you’ve reached your deductible. That’s where the HSA comes in: with its tax savings a $500 medical bill essentially gets paid using $300-ish of net take home (what you would have received after taxes were subtracted when not using an HSA).
Broadly speaking, an HDHP tends to fit best for the extreme cases. A person (or family) with practically no medical expenses benefits from the lower monthly premium + tax advantages of an HSA. Someone with a lot of expenses who hits the deductible / out-of-pocket max quickly may end up with similar net cost (premium + expense payments) as they would under a PPO.
Unfortunately for your question, most people are in a fuzzy middle area where it’s not as clear which would end up with a lower overall cost. The savings from a co-pay (fixed cost per visit vs. unknown variable one) can be significant depending on the type of care you end up needing.
My gut feeling is that neither of those plans are particularly bad. A PPO with a $750 deductible and $733/month compares pretty well. A lot of little visits can get expensive under an HDHP compared to co-pays, and that $4k deductible might not be something you would reach in a typical year.
Depends on your use and the plan. I chose the higher premium of the two HSA plans last year since we were having a kid and despite all those costs we still would have been better with the lower premium/higher deductible plan of the two, and beat the non-HDHP by a mile especially including the employer contribution and tax savings
Does it make sense to change plans when you have a child for the initial year or two then revert back to a high deductible plan later?
I”ve had an HSA (and a HDHP) for 11 years. Early on, it was pretty good. Most of our doctor visits were preventative (so covered 100%). A few sick visits here and there – maybe we spent $500/year. And at the time, I was paying $240/mo for the plan for 5 people. My company was putting in $500 and we had fairly easy and reasonable incentives for another $1200/year.
I put in the max the first few years and then invested whatever I could while still keeping something like $3000 to the side for immediate use.
On the front end, it worked out great. I was putting in about $4300/year, tax free. Company was giving me about $1700/yr. And most years, I was spending $500/year.
Then my wife had a major surgery where we hit the individual deductible. So long $5500. Then one kid needed medication, plus therapy, etc. I’ve mostly drained down all of those “gains” for the first 7 years in the last 4 years. Of course, these things would have happened anyway. And I might still be on the “plus side” of it because my company’s PPO option is super expensive and still has a $2500 deductible.
I’ve had an HSA for the past 10 years. I’ve always maxed it, and invested it in the S&P. Never spent a dime of it. It’s currently over $50k. If I never contribute another dime it will be over 100k when I retire. That’s a huge pot to draw from for medical expenses. And we know how expensive that will be!
I am one of HSA’s biggest fans. I think people should do an HSA even if it costs them more on a yearly basis (within reason). It just has so many tax benefits that you really should be maxing it out before contributing anywhere else to retirement savings (save to capture an employer match). To me it’s not about trying to save money on insurance, it’s about having access to another tax advantaged retirement account.
You are comparing different things. The HDHP was likely a PPO. The other plan is a HMO. Those are vastly different system.
HMOs are often significantly cheaper than PPOs. Regardless of if the PPO is a HDHP or not.
You need to understand the difference between the PPO and the HMO. Their networks are going to be different, and you are going to need preauthorization to see a specialist under the HMO.
Depends on the numbers. It’s work out well for me.
In your case probably not. An office visit is going to cost a couple hundred after insurance “discounts”. That will eat up the $900 in premium savings pretty quick.
People focus on the lower deductible, but out of pocket max is much more important in my opinion. Compare the non-hsa plan as if you were maxing out of pocket for the year and see what comes out ahead.
Don’t forget to factor in the income tax deduction on the HSA
It sounds like you could save a lot with an HSA. Personally, I have myself and one child on my HDHP. The max I can save is like $8300. I max it out each year. I set it to auto invest when the balance goes over $2000 so I have a little “emergency” HSA available if I need it and the rest gets invested with each paycheck contribution. If you are a little risk avoidant, that strategy might help.
Yes, when I was young and healthy I never used health insurance besides my annual physical. I saved up around $4k in the first couple years then went to grad school. About ten years later I got a job that offered HSA again and I maxed it out each year. My balance is now 82k.
If you don’t have medical problems often and take relatively good care of yourself then a hsa is a great thing because pre tax and invest with that money in the provider. Then when the inevitable happens it’s can potentially zero all your bills or at least take a big chunk out of it.