What I Did Wednesday: Insurance


Leaving California left us with a lot of empty holes, not just in our heart but in our lives.  Drew’s prior district provided great full family health benefits, this district, not so much.  It was going to be 800 dollars/month for me and the kids to be added, which is a pretty big chunk of his paycheck, so I decided to check out  my other options.

I finally decided on an HSA with a high deductible plan.  We basically put the money that we would have been spending on our month to month payments, and put that between the HSA and the health plan.  I really like it, although I do worry something will happen, but there are a lot of benefits to doing this.

1.  This is individual insurance.  Me and the kids are fairly healthy (I have to pay a little more because of my history of kidney stones, and P and C each pay more because they’re so small — seriously).  If you do have any prior medical history, this may not be the way to go for you, because they do check you out pretty thoroughly.  I actually applied with a couple of companies to see who was going to “ding” us for what.  Both companies rated some of us up, all for pretty random reasons.  BUT, now that we’re done with that process, this insurance is transportable.  If Drew, heaven forbid, was to lose his job we still have it.  It’s ours. :)

2.  Well checks are free.  I kind of held my breath when I took P and C in for theirs, but they paid the whole bill -thanks to Obama care, I think.

3.  Immunizations are also free.  Sweet.

4.  We don’t go to the doctor very often.  Sure, I thought I tore my rotator cuff in December, but I just hunted around on the Internet for what they’d do and I just made do.  I am 99% sure the doctor may have done a useless X-ray and then would’ve said to take some ibuprofen and apply heat.  I told myself to do that, and it seems to have worked.  We actually haven’t used a cent of our HSA since we started it.  If you are a nervous wreck until you see an MD, this may not be the plan for you.  BUT, small office visits aren’t that much.  I’m saving over 300 dollars/month going with this plan.  That’s a few office visits.

5.  HSA money is mine, for any medical expenses.  It’s great, it grows in there tax free and the money is earned tax-free. It’s annoying that there aren’t many companies that do this, and more and more are charging a fee, but I’m still making more on interest then I do in their fees, so I’m still good.  BUT, if we were to go on Drew’s insurance I can still use the HSA money for medical expenses even under the other plan.  This means if for some reason it ever gets big enough that I feel like I can get Lasix, guess who will be gettin’ her eyeballs burned out.  That’s right, me.

6.  It will be tax deductible, next year.  I didn’t spend enough on it this year (we still had Drew’s insurance up til’ September) but next year I will be able to deduct the cost of the insurance on my itemized taxes.

7.  Once our HSA grows a bit more, I will increase our deductible, to save us more money in the long run.

At first, I thought we’d go to Drew’s plan once he’s making more, but I really like this plan.  It puts me more in charge of my health care dollar, and that’s a good feeling.  I will admit that I like the fact that I have Drew’s plan as a backup that we can get into during open enrollment if something really bad happens, but with this plan we’d only pay 3k and the plan covers every other cent.  Even with Drew’s insurance, for something big, I think we’d be out more.

Do any of you have HSA’s?  Are you paying a ba-jillion dollars for health insurance?  I’d encourage you to look into it — information can’t hurt. :)

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Comments

  1. says

    We did an HSA years ago for the same reason…not good insurance at my husband’s employer. It was ok…but then Trev started having weird breathing issues (turned out he developed asthma in his old age)…and we maxed out the deductible. I never felt like we could get ahead in the HSA. I had high hopes of creating a little health care nest egg, but it never did for us. All said though, I do like the control you have over it. And all the well-checks being free makes sure everyone gets good preventative care. That’s a good thing.
    Make sure you are taking the tax deduction for your contributions to your HSA account. That’s done on Form 8889 and is not part of your itemized deductions. It’s another type of deduction on the 1040. You also have to report your distributions from the HSA on that form, but like you said, those are all tax free as long as used for medical expenses.

    Your premiums would be eligible for the itemized deduction for medical expenses, but those have to exceed 7.5% of your AGI before the deduction starts being allowed (for the amount OVER 7.5% of AGI). And that is changing to 10% in 2013. You can also deduct as itemized deductions any other out of pocket medical expenses (except for those which you paid via the HSA account…because you already got a deduction for that).
    Make sense? Gotta take advantage of every tax benefit!!
    Good luck…sounds like it is working great for you guys!