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Learning, Sharing, and Teaching => Ask a Mustachian => Topic started by: SheepDog on May 14, 2017, 12:10:14 PM

Title: PPO or HSA?
Post by: SheepDog on May 14, 2017, 12:10:14 PM
Quick question on insurance.  Currently on wife's health plan; a PPO which costs us about $300 a month for H/V/D.  Co-pays for most visits and meds, up to I think a $5000 max out of pocket per year.  80/20 split for larger expenses like hospital stays, ambulance trips, and surgeries, up to the out of pocket max.

My employer offers an HSA/HDHP for $175 a month for H/V/D.  $4000 yearly deductible and separate $2000 prescription deductible.  Employer also deposits $3000 into HSA account per year which can be invested once the balance is over a certain amount.

Wife and I are 25/26 years old with no children and in good health, non-smokers, ect.  Do plan on having kids in the next few years.  No major health problems expected in future other than I only have one kidney and both the wife an I have some lumbar spine issues which hopefully won't flare up too much later in life.

I'm leaning towards the HSA because if we can keep our medical expenses low for a year or two, we will be able to just use the employer's seed money to pay for all our medical bills and never have to pay out of our own pockets for healthcare.  Also its free money to invest and possible use for other things later in life, after age 65.

What do you guys think?
Title: Re: PPO or HSA?
Post by: Jtrey17 on May 14, 2017, 02:07:22 PM
All of the HDHP plans that I've ever seen (been on one for years through employer) are really a high deductible PPO/indemnity plan. What's the in-network and out of network split? 100/0, 90/10, 80/20?
Title: Re: PPO or HSA?
Post by: SheepDog on May 14, 2017, 03:08:18 PM
The HSA is zero cost to me for in-network providers after the deductible is met. Out of network providers I'm 20% liable after the deductible.   The HDHP is anthem so it's pretty well covered in my area.
Title: Re: PPO or HSA?
Post by: MDM on May 14, 2017, 03:20:24 PM
What do you guys think?
There is quite the variety of choices, so I'm not aware of any "one size fits all" comparison tool.  The 'HDHP Analysis' tab in the case study spreadsheet ( might be useful as a starting point that you could modify for your situation.

If one option is always better than the other, regardless of your medical costs for the year, then your choice is obvious.  If the better plan depends on your medical costs, then you have to take your best guess....
Title: Re: PPO or HSA?
Post by: hyla on May 14, 2017, 09:01:30 PM
Definitely switch to HSA.  The fact that your employer offers 3,000 a year into your HSA account, you don't have any regular, expected medical expenses, and the out of pocket max is similar for the HSA vs. PPO, all make the HSA a good choice for you.  I also chose to go with a HSA at work for similar reasons. 
Title: Re: PPO or HSA?
Post by: SheepDog on May 15, 2017, 06:34:48 AM
Thanks for the replies.  Found out that next month is the open enrollment period for my employer and they are doing a workshop during that time.  We are going to go and learn about it in depth and probably sign up for it. 

On the surface it seems like a good deal financially. 
Title: Re: PPO or HSA?
Post by: Roboturner on May 15, 2017, 12:45:50 PM

HSA all the way