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Am I HSA Eligible?

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  • Avatar MFC 
    Participant
    Status: Dentist
    Posts: 5
    Joined: 06/09/2019

    Hey all,

    I am a little confused about what health insurance policy will qualify for a HSA account. Background, I am 30 years old, healthy practicing dentist who is an associate. No benefits through work, I need to insure myself.

    The biggest confusion is what is a high deductible health plan (HDHP). I understand that the IRS defines a HDHP as a deductible of at least $1,350 for an individual or $2,700 for family.

    Now, just by that definition, I though my current health insurance (Florida Blue) would qualify. It has a In-Network of $6,200 deductible of per person and $12,400 per family. This is a copay plan. So when I visit a doctor I pay a copay for visits. Premium=$364/mo.

    After digging a little deeper, I have found that just because a plan is a HIGH DEDUCTIBLE plan does not mean it will qualify for a HSA.

    The other plan that Florida Blue offers is a HSA plan for In-Network $6000 per person and $12,000 per family. In this plan I pay everything, until I meet the deductible, then insurance will cover a percent. Premium=$357/mo.

    I guess I have a few questions.

    1. What is the true definition of a HDHP?

    2. Which option would be most beneficial considering the Triple Tax Deduction of an HSA account?

    Thanks in advanced!

    #220407 Reply
    ENT Doc ENT Doc 
    Participant
    Status: Physician
    Posts: 3168
    Joined: 01/14/2017
    #220422 Reply
    Liked by Peds
    ENT Doc ENT Doc 
    Participant
    Status: Physician
    Posts: 3168
    Joined: 01/14/2017

    BTW your answer to #2 will depend on the specific percentages and your healthcare utilization.

    #220426 Reply
    Avatar MFC 
    Participant
    Status: Dentist
    Posts: 5
    Joined: 06/09/2019

    Thanks ENT doc. The only area that mentions insurance benefits kicking in, after deductible is met, is under prescription drug plan. Please see below (copied from doc)

    Prescription drug plans. You can have a prescription drug plan, either as part of your HDHP or a separate plan (or rider), and qualify as an eligible individual if the plan doesn’t provide benefits until the minimum annual deductible of the HDHP has been met. If you can receive benefits before that deductible is met, you aren’t an eligible individual.

    Still after reading the “Qualifying for HSA” section, I am not certain. Was there a specific paragraph that was clear to you?

    #220510 Reply
    ENT Doc ENT Doc 
    Participant
    Status: Physician
    Posts: 3168
    Joined: 01/14/2017

    What are the specifics of your prescription plan? Your benefits person can typically tell you if you are HSA eligible BTW.

    #220517 Reply
    Avatar spiritrider 
    Participant
    Status: Small Business Owner
    Posts: 1750
    Joined: 02/01/2016

    Any plan that has a co-pay implies that there are payments for services/products before the minimum statutory plan minimum deductibles. Such a plan is not HSA eligible.

    #220597 Reply
    Liked by MFC
    Avatar MFC 
    Participant
    Status: Dentist
    Posts: 5
    Joined: 06/09/2019
    Earnest refinancing bonus

    What are the specifics of your prescription plan? Your benefits person can typically tell you if you are HSA eligible BTW.

    Click to expand…

    For plan 1 (None HSA): It is

    Generic-Preventive: No Charge (retail)/ Condition Care Rx: $4 Copay per Prescription (retail)/ All Other Generic: $24 Copay per Prescription (retail)

    For plan 2 (HSA):

    Preventive: No Charge (retail)/ Condition Care Rx: $4 Copay per Prescription (retail)/ All Other Generic: Deductible (retail)

    #220733 Reply
    ENT Doc ENT Doc 
    Participant
    Status: Physician
    Posts: 3168
    Joined: 01/14/2017

    I would defer to Spiritrider on this. Though in Pub 969 I didn’t see where a HDHP with copays necessarily is excluded from being called a HDHP for HSA purposes.

    #220740 Reply
    Avatar spiritrider 
    Participant
    Status: Small Business Owner
    Posts: 1750
    Joined: 02/01/2016

    From Publication 969, page 4:

    Prescription drug plans. You can have a prescription drug plan, either as part of your HDHP or a separate plan (or rider), and qualify as an eligible individual if the plan doesn’t provide benefits until the minimum annual deductible of the HDHP has been met. If you can receive benefits before that deductible is met, you aren’t an eligible individual.

    If a participant only has a co-pay that means the insurance company pays the remainder. Therefore, the participant can receive benefits before the deductible is met.

    #220761 Reply
    Liked by ENT Doc
    Avatar tylerjw12 
    Participant
    Status: Spouse
    Posts: 10
    Joined: 05/23/2016

    Some HSA eligible plans have benefit summaries that show copays for drugs, in which case they would typically be accompanied by language similar to “applies after deductible”. There are some exceptions for preventive type medications that companies can offer on HSA eligible plans for a copay or even $0. These meds are going to be preventive in nature, and several are mandated to be no-cost by the ACA.

    #220764 Reply

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