I’m in process of getting my first real job at 26. Along with this comes health insurance etc.
The job is physical in nature I’ll be shoveling gravel and carrying 75lbs all day hoping to move up the ladder.
That being said the company offers a HDHP with HSA and that is the only plan they’ll fully pay the premium for. Apparently they offer real health insurance (PPO or HMO) but I have to throw a chunk of my paycheck at it additionally. I don’t have the financials yet because I’m not that far in the process. Talking to another employee seems the standard plan is $10,000 out of pocket max and $4,000 deductible.
Combined with my extreme bad luck, physical nature of the job, and past experience I think I should just avoid the HSA entirely and pay for the higher tier plan. In my teenage years I basically wiped out my parents with one of these HDHP plans when I got in a fight and some kids broke my jaw and I believe they got a hospital bill for about $20,000.
Since then I’ve been in about 4 or 5 car accidents, 2 cars were basically scrapped. I go to the gym and drink ungodly amounts of monster and nicotine so I don’t know how long my nervous system will hold up.
That being said what’s the plan that will stiff the insurance company the hardest if I go into cardiac arrest at any moment.
HDHP vs PPO for high risk
byu/hitlicks4aliving inpersonalfinance
Posted by hitlicks4aliving
6 Comments
Dude with your track record you’re gonna blow through that $4k deductible in like 2 months lmao
Honestly though if you’re that accident prone and doing heavy labor, paying extra for the PPO might actually save you money in the long run. The HSA is great for healthy people but sounds like you need the real coverage
It is a math problem and without knowing the premiums and details you can’t possibly solve it.
If your premiums fit the PPO plan are $1000 a month, it isn’t a better deal. If the premiums are $10 a month it probably is.
Every employer does it differently. For me, the PPO is almost always a worse deal. The premiums are higher than the HDHP deductible and if you assume copays and the PPO deductible (and lose the value of the HSA), it is worse both when you use no healthcare and when you use lots of healthcare and hit be out of pocket max.
But that’s my company. Some companies price it so the PPO is a better deal.
It’ll depend on the actual numbers. Do this math for both plans, pick the plan with the lower cost.
Monthly premium x 12 + max out of pocket – whatever is saved from using a HSA.
I kicked myself for getting a PPO instead of a HDHP when I realized I was leaving nearly 2k on the table, through premiums and opportunity cost for the HSA. Free deductible is pretty nice.
The HSA is the best retirement account available with triple tax savings. (No tax going in, no tax on earnings, and no tax going out as long as it’s to pay for medical expenses.) And as long as you save the receipts for those expenses, you can leave the money in the account indefinitely to earn more money, making it a great emergency fund.
We had a similar choice. A high deductible account with no premiums versus a PPO account with monthly fees. Even with hitting that deductible every year, the HDHP was cheaper because of the lack of monthly premiums, but the HSA was the cherry on top.
Getting in before someone mentions worker’s comp as an option for on the job injuries. Yes, that will be available to you. However, based on what I’ve seen from my partner and friends in the trades if you actually use it short of some seriously debilitating injury, you’re basically blackballed from your job and possibly industry if your town is small enough.
The reality is that you’ll have to take the premium cost saved by using the HDHP and put it into some sort of accessible account for when you have to pay the extra medical costs under that plan. I doubt given your job and lifestyle that you’ll have enough cash flow to both cover medical costs and benefit from the HSA. Do you have that self-discipline? Based on how you’re describing your life, I’m dubious.
Make sure you elect short and long term disability insurance. You can shop around outside of work for good policies, or they should have some through work. Note: this is not workman’s comp.
HDHP plans are either PPO or HMO, just FYI. All health insurance plans are.
Otherwise agree with other commenter that it’s a math problem and you’ve given us no numbers.