Which HDHP plan should I get for the remainder of this year? Accuracy of my calculations? 1500 deductible vs. 3250 deductible with lower premium. Possibly high Out of Network costs.
I am trying to select between two HDHP plans that will last until the end of this year. There will be 11 paychecks the remaining 5 months.
About my situation:
For taxes, I make 100k/year (24% bracket) and have no state tax. I think my FICA Tax Rate is standard, 7.65%? I estimate in-network costs = $800-$1200, more likely to be $800 or lower. I estimate unfortunately expensive out-of-network costs = $3000. I might be able to get it down to $1500. Plan 1 means I have to undo some of my HSA contributions, because earlier I contributed the full amount at my previous employer. I don't know the costs of that.
Plan information:
Premium HSA HDHP Basic HSA HDHP Premium (per paycheck, every 2 weeks) 40.15 11.54 In-Network Deductible 1500 3250 In-Network Out-of-Pocket Maximum 5000 6500 In-Network Coinsurance (Amount NOT covered) 20% 20% Employer HSA Contribution (prorated*) 208.33 0 My HSA Contribution 3642.67 3850 Out-of-Network Deductible 1500 3250 Out-of-Network Out-of-Pocket Maximum N/A N/A Out-of-Network Coinsurance (Amount NOT covered) 40% 40% Total Premium (prorated for 11 paychecks) 441.65 126.94 Estimated Costs of $800 In/$3000 Out (see below for calculations) 1984.01 2711.88 Estimated Costs of $800 In/$1500 Out (see below for calculations) 1384.0089 1211.88
(as image: https://i.imgur.com/kfpvw0U.png)
*Note: The "208.33" employer HSA contribution is prorated monthly, based on an employer contribution of $500/year.
My calculations:
In Network Costs Out Of Network Costs Plan 1 – Plan 2 Plan 1 Total Plan 2 Total In Network Total Out of Network Total Employer HSA Contribution Tax Savings from HSA 800 3000 -727.87 1984.01 2711.88 800 2100 208.33 1149.31 1750 3000 -927.87 2734.01 3661.88 1550 2100 0 1215.06 800 1500 172.13 1384.01 1211.88 800 1500 208.33 1149.31 1750 1500 -27.87 2134.01 2161.88 1550 1500 0 1215.06
(as image: https://i.imgur.com/9ka3sbB.png)
(Full document on Google Sheets, sorry about how it looks): https://docs.google.com/spreadsheets/d/1_2B9bZeruaHVwMuffBQhpwzTnF0MGlbqIR-x6B2qvlY/edit?usp=sharing (as pubhtml: https://docs.google.com/spreadsheets/u/1/d/e/2PACX-1vSgNUzk9mqa3Kk1AFYjxca7Ks87Xq4mCif712Hoo5PmaaFGhzYitUV1hw55lWRwOz7EBLjVc2isOXjs/pubhtml?gid=0&single=true)
If my calculations are correct, the TL;DR pros of each:
Plan 1
I won't have to go through the effort to try and reduce my Out-Of-Network costs below $3000 Better for almost any range of In-Network costs (except for $5000 – $6500)
Plan 2
I won't have to fix my HSA or pay any consequences for overcontributing Lower premium Better by ~$200 if I can reduce the Out of Network cost to below $1500
Am I missing something, or is Plan 1 always better at the minor inconvenience of having to fix my HSA?
More details:
I've calculated these as: Total Premium + Total In Network Costs + Total Out Of Network Costs – (Employer HSA Contribution + HSA Tax Savings)
They are bolded in the spreadsheet.
Estimating $800 In, $3000 Out:
$1500 Deductible: 40.15*11 + 800 + (1500 + (3000 – 1500)*0.4) – (208.33 + 3641.67*0.3156) = 1984.0089 $3250 Deductible: 11.54*11 + 800 + 3000 – (3850*0.3156) = 2711.88
Difference = 1984.0089-2711.88 = -$727.87, with Plan 1 being better. For $2000, the difference is -$127.87.
Estimating $800 In, $1500 Out:
$1500 Deductible: 1384.01 $3250 Deductible: 1211.88
Difference = $172.12, with Plan 2 being better. This is the same for any Out-Of-Network costs below $1500.
So, my analysis is that Plan 1 is better if I can't reduce my Out-Of-Network costs below $1500, otherwise, Plan 2 is better. Plan 1 also seems significantly better for Out-Of-Network costs at $3000+, but less so at lower. It would be inconvenient to reduce the Out-Of-Network costs, and in the end it may still end up being around $1800.
Also, it doesn't seem like In-Network costs will make that much a difference unless they're around $5000 – $6500. I don't think I'll even incur $5000, that since I'll be at home most of the time.
Additional/optional things:
I'm electing an Accident plan as well (it's very cheap) Did I calculate the HSA tax savings correctly? submitted by /u/Reasonable_Movie_925
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