Experience with an HSA with Kids?

[MountainLakeMama]

I'm a single mom of 3 boys- 13, 11, and 11. I've always had the PPO but I'm thinking about switching to the QHD plan with an HSA. It seems like it might benefit me financially, but I'm really nervous about making the switch. Does anyone have experience with this?

[joe189man]

is your plan to not use the HSA for medical expenses and more of a retirement vehicle? we do a mix of both with a 5 and 3 y/o and it works out fine

[MountainLakeMama]

Well, I think I would HAVE to use it for both. I doubt I could afford to wait too long to be reimbursed. But I really like the idea of any remaining $$ being saved for retirement! I guess I'm scared of the unknown. But the PPO is SO expensive! It just feels like I *might* be able to keep more of my $ in the long run with the HSA.

[chemistk]

My boys are a lot younger than yours (5,3,1) so YMMV, but we've never been able to roll over more than a few hundred dollars year to year.

We have an HSA in the first place because for our circumstance, the HSA nets out to the cheapest plan. We have 3 plan choices at work and the HSA plan is the 'middle' choice in terms of premiums that we're responsible for but it's highest in OOP costs and deductibles (understandably). This is made up on the back end - my employer contributes $2k to our plan annually, so with that the net OOP cost is slightly lower than the other two plans.

We contribute a few thousand pretax to the plan as well, but births, ear infections, croup, medications, dental costs, vision costs, etc. all whittle down the HSA balance. We're absolutely not in a position to be contributing to the HSA AND paying OOP for everything, so for us it's not a retirement vehicle at all right now.

[joe189man]

Well, I think I would HAVE to use it for both. I doubt I could afford to wait too long to be reimbursed.

HSA plans usually come with a "debit" card that you can use at the doctor or to buy prescriptions, etc. that is connected to the HSA account. No waiting to be reimbursed anymore

[NorCal]

We're just starting our second year of an HSA with kids (3 and 7).  I have no concerns with the kids aspect, but I did have some lessons learned on the provider side.  My assumption is that you'd fully fund the HSA with the expectation of higher out-of-pocket expenses.

We're in Denver, and a lot of our experiences are related to the local health care providers.  Your market will likely be different.

Our first year of HSA (and previously under a PPO) we used the local UC Health system.  They're well regarded and very large in this market.  What I've since learned is that their billing practices are absolutely ridiculous.  A simple visit would result in half-a-dozen poorly explained bills from different parts of the visit.  Pretty much anything other than preventive care would result in $1,000+ out of pocket expenses.  Out-of-pocket was still pretty high with them even under our old PPO plan.

We switched to Kaiser this year, and it's a world of difference.  The quality of care seems equally good.  Yet our out-of-pocket expenses come from a single bill that is maybe a tenth of the price of the UC Health system.

I also learned how important it is to really look at provider networks, deductibles, copays, and coinsurance.  I looked at a LOT of marketplace plans before eventually settling on Kaiser.  Not all HSA or PPO plans are created equal (or even close to equal), and the differences can be quite complex.  I recommend building a simple spreadsheet to go through a few hypothetical scenarios (broken bones, short hospital stay, ER visit, etc) just to try and understand the plans. 

Bottom line, I think HSA's can be a fine option for families with kids, but you need to understand your plan and understand what you're buying.

[MDM]

I'm a single mom of 3 boys- 13, 11, and 11. I've always had the PPO but I'm thinking about switching to the QHD plan with an HSA. It seems like it might benefit me financially, but I'm really nervous about making the switch. Does anyone have experience with this?

It all depends on the specifics of your particular PPO and HDHP plans, and possibly your expected medical expenses.

Might be worth putting your numbers into a couple of comparison tools, e.g., Health Savings Account (HSA) vs. Traditional Health Plan and the 'HDHP Analysis' tab of the case study spreadsheet.

[charis]

We have kids and have had a hdhp with hsa for the past 6 years. What is your concern specifically?

 Whether it's cheaper is matter of math. I always plan to max the deductible (3k but plan itself pays 1800 in hsa). I want the tax benefits and flexibility of an HSA - currently have 45k invested.

[yachi]

We have 4 kids: 11, 9, 6, and 2.  We've had a HDHP plan with HSA for the last 7 years.  It took a while to build up the HSA to cover what we needed (like maybe a year).  The first year we had to pay things from the checking account, and then get reimbursed later.  While the HSA technically makes a great retirement account, you need to save all your receipts to do this, and it's just too much hassle for us.
I'm not sure what our costs are today, but in 2015 when my boss asked how I liked the healthcare plan, I figured we were spending $800 per month for unlimited healthcare.  Basically our family's deductible was less than what we were putting into the HSA.  After the deductible, everything was covered 100%, except for $40 per doctor visit.  We met the family deductible every year (except 1 year where we changed employers), but this plan is cheaper than anything else my employers were offering.

[MountainLakeMama]

I guess my main concern is if it will possibly save me $ in the long run, or end up costing more. The comparison tools look really helpful, so I'll definitely check them out.

[reeshau]

While the HSA technically makes a great retirement account, you need to save all your receipts to do this, and it's just too much hassle for us.

A comment on this, for the greater group:

There is nothing that says you have to have original receipts.  It can be as easy as taking a picture, and stashing it on your favorite cloud service, or with other financial files.  Do make sure you either take note of or just don't copy expenses that have already been reimbursed.

Further to future use, Medicare isn't free--the $240k of medical costs in traditional retirement will need to come from somewhere.  Even for myself, 10 years from 59 1/2, I find the HSA a handy insurance policy; in case of a major medical incident, I can withdraw whatever I need without screwing up my ACA subsidies or my mega backdoor plan.