Switch to HMO (for pregnancy) then potentially back to HSA after?

[jeromedawg]

Hey guys,

I know I've created a couple threads about this in the past but I don't think I asked about the scenario in which we are *potentially* planning for another kid and where we're currently on a lower-usage/high-deductible HSA, considering switching to HMO per current open enrollment for 2019 (for the lower costs of delivery, etc which could possibly be next year), and then switching back to the HSA right after the potential 2019 delivery. This way we would get the benefits of the lower cost HMO and then when you switch back to the HSA (presumably in the same year) you do a lump sum contribution and *hopefully* can also get the incentives offered by the company (upon completing certain tasks etc). Am I missing anything or not taking something into consideration with this 'strategy'?

Has anyone planned things out this way before? I'd imagine it's better if you can try to plan your pregnancy so that the delivery date is as early as possible into the next year, so that the switch to the HSA would allow for more time in terms of getting the incentives and sorting out logistics of changing doctors... that's the other thing. If we were to switch to HMO, we'd be going to Kaiser, which we have never been with. We'd get all new doctors and all that. Of course, switching back to the HSA later wouldn't be a big deal since we'd already be registered patients with our existing docs.

The difference in savings could range anywhere from roughly $1000 (factoring in the HSA incentives from the company) and likely more but really depends on how much we anticipate spending. So HSA is still more expensive in the near-term. Over the long-term, I suppose we would 'break-even' as we contribute more to the HSA and interest compounds... currently I have the HSA funds invested in VBMFX (yes, they offer Vanguard funds!)

Any tips/pointers or other considerations?

[mm1970]

It doesn't really make sense to do this.


You asked this two years ago.  And you even talked to your HR people.

https://forum.mrmoneymustache.com/ask-a-mustachian/should-we-switch-from-hdhp-hsa-to-hmoppo-if-expecting-after-next-yr/

We only have Kaiser HMO and Kaiser HDHP as far as Kaiser is concerned. I called my HR dept and asked what would happen if we were on Blue Cross and delivered at a Blue Cross affiliated hospital (not Kaiser) and then switched to a Kaiser plan upon declaring the life event. The rep told me that we would basically have to pay whatever the delivery costs are for the Blue Cross affiliated hospital and it would most likely be out of network. So I don't think trying to do something like this would make much sense.

We may consider switching to Kaiser during the standard open enrollment instead. However, we do have concerns about switching doctors (primary, OBGYN, etc) that late along in the pregnancy when we had already been seeing the Blue Cross counterparts prior. It's more just a logistics concern...   

[jeromedawg]

It doesn't really make sense to do this.


You asked this two years ago.  And you even talked to your HR people.

https://forum.mrmoneymustache.com/ask-a-mustachian/should-we-switch-from-hdhp-hsa-to-hmoppo-if-expecting-after-next-yr/

We only have Kaiser HMO and Kaiser HDHP as far as Kaiser is concerned. I called my HR dept and asked what would happen if we were on Blue Cross and delivered at a Blue Cross affiliated hospital (not Kaiser) and then switched to a Kaiser plan upon declaring the life event. The rep told me that we would basically have to pay whatever the delivery costs are for the Blue Cross affiliated hospital and it would most likely be out of network. So I don't think trying to do something like this would make much sense.

We may consider switching to Kaiser during the standard open enrollment instead. However, we do have concerns about switching doctors (primary, OBGYN, etc) that late along in the pregnancy when we had already been seeing the Blue Cross counterparts prior. It's more just a logistics concern...   

You're right. I get flustered with open enrollment like every year lol. I'll have to review that thread again... not sure why I didn't just reference it initially. I think the key point was that if you are considering doing this "switch" based on the life event, the new insurance kicks in on the date of birth/life-event. So if you delivered at Kaiser and then switch insurance, you will get billed "out of network" - same applies if you deliver at another hospital and then switch to Kaiser insurance.