I have an obscure tax/HSA/health insurance question that I thought might intrigue this crowd.
My wife and I are having our first child this fall and are trying to figure out how to add Mr. Baby to health insurance. We're both employed by the state and therefore have exactly the same insurance plan options. We currently each have separate high-deductible health insurance plans, both of which come with $700/year in employer contributions. If either of us adds Mr. Baby, then it costs $15 additional per month ($180/year) and the HSA contributions double, to $1400. So, here are our options:
(1) Combine onto one plan. This would cost $29/month more than we're currently paying, but being on one plan means only $1400 in free HSA contributions.
(2) Add Mr. Baby to one plan (probably hers). This would cost $15/month more than we're currently paying, and we'd get $1400 + $700 in free HSA contributions.
(3) Add Mr. Baby to BOTH plans. This would cost $30/month more than we're currently paying, and we'd get $1400 + $1400 in free HSA contributions.
Obviously, the upside of (1) is that we'd all three be in a combined deductible/max out-of-pocket situation. But I rarely use my health insurance and am comfortable with that risk, especially since the max out-of-pocket isn't that high.
Option (3) seems strange but maybe worth doing? As I understand it, Mr. Baby would be primarily covered by my wife's insurance (birthday rule), and we'd have no reason to make any claims on mine. So, it seems that in (3) vs. (2), we'd get $700 additional in HSA contributions, for the marginal cost of $180 ($15/month). The only downside risk I see is that with option (3), my deductible and out-of-pocket maxes would double.
Am I missing something here?
