I got a new job and they offer 5 different plans to choose from. My situation: me in my late 30’s, would like to have physicals and imaging and testing and whatnot to make sure I’m healthy. We have a 2 months old baby, he’s healthy. Will include the wife in the plan, so it’s going to be a family plan. I’m debating between: (I get paid per 2 weeks so multiply the cost below by 26 to get an annual cost)
Silver HDHP OAP with HSA: cost $92 per paycheck, deductible $3600, coinsurance 15%, oop max $6k.
Gold OAP: cost $294 per paycheck, deductible $1k, oop max $5k, conisurance 20%.
Kaiser Platinum HMO: cost $128 per paycheck, deductible 0, oop max $3k, coinsurance 0%.
Kaiser looks good but been reading about them and some bad stories from people using them. Plus I’m leaning towards PPO/OAP in general. I’m thinking maybe get the Gold OAP now to have low deductible to get my tests done, and switch to Silver HDHP + HSA in the next open enrollment. But with a growing family and me approaching my 40s I might need to rethink that vs staying in Gold OAP.
Silver Plan: Max out-of-pocket: $8,208 Gold Plan: Max out-of-pocket: $12,506
In my opinion, the Silver plan is better, especially if you also choose the HSA. If you reach your medical expenses for the year, the Silver plan will generally be cheaper.
I would choose the Gold Plan. A $294 premium for a family is reasonable, plus it has a low deductible and offers more doctor options.
The HMO can be risky. I once had a severe ingrown toenail, and if I had waited longer, it could have caused serious damage. My insurance got me into a podiatrist that same day without needing a referral.
That’s just my two cents. I recommend going with the Gold Plan.
Insurance is all about reducing risk. I use a method called Annual Max Financial Liability. First, add the annual premiums to the out-of-pocket maximum (OOPM). Then, subtract any money the company contributes to an HSA, FSA, or HRA since that’s free money.
The plan with the lowest total cost is usually the best option if you have a high usage year, like one with surgery, ER visits, or hospital stays.
I assume the amounts you listed for these plans are for employee-only coverage. If these are family premiums and OOPM, then all three plans offer excellent family coverage with rich benefits at prices well below the benchmark.
Another approach is to create a spreadsheet of your typical year of care. Include the number of doctor visits, prescriptions, and any expected procedures. Estimate the costs for each plan, add them up, and choose the least expensive option. However, this isn’t an exact science. You may have to guess on pricing, and your actual care might differ from your budget. That’s why I prefer the Max Financial Liability method; it uses straightforward math with no guessing.
Next, consider the pros and cons of different plan types.
HSA/HDHP plans require you to meet your deductible before insurance pays anything. If you want the security of paying a small copay for doctor visits and prescriptions, the HDHP plan may not be right for you. Kaiser plans are true HMOs with no out-of-network benefits, meaning you must use Kaiser for all care (emergencies are covered by the No Surprises Act). People either love or hate Kaiser; it really comes down to personal preference.
With the growing baby and my upcoming checks it’s hard to predict our needs. My thinking is to have the Gold for now and have some time to think about if I want to switch to the Silver plan + HSA in the next open enrollment.
Is the employer contributing any money to the HSA? That would be an important factor for me and could make the HDHP more appealing. If not, the Gold plan might be a better option.
Yes employer puts in $600 per year. I never had an HSA but it sounds like an average deal. Thinking about getting Gold now to cover my needs then switch to Silver + HSA next year.
How often do you get paid? Are the deductible and out-of-pocket maximum amounts for an individual or a family? Does your employer contribute $600 per year to the total HSA?
The Gold plan premiums are $5,252 more per year than the Silver plan premiums. If you choose the Silver plan and contribute $202 from each paycheck to your HSA, your total contributions, along with your employer’s contribution, will effectively cover your family’s out-of-pocket maximum.
Contributions to the HSA come from pretax income and grow tax-free. You can also use the HSA for retirement if you don’t need it for healthcare expenses.
Yes, I calculated that too, but my health status is still uncertain. Once I complete all my tests and confirm that I’m healthy, I’ll switch to the Silver plan with the HSA. For now, I’ll go with the Gold plan for the rest of the year to cover my tests. What do you think?
Do you have any concerning symptoms? When does open enrollment start? You’ll have to pay your individual deductible regardless, so the total cost of that plus the additional premium for the Gold plan may be about the same or even less than the Silver plan.
Whatever you do, don’t choose Kaiser. They’re not worth it. If they operated like a regular HMO, it might be fine, but they don’t. They require you to go to their own facilities and won’t cover out-of-state emergencies. I’ve seen this happen.