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Health insurance NOT HSA compatible

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  •  No1ofconsequence 
    Participant
    Status: Spouse
    Posts: 8
    Joined: 10/29/2018
    Earnest refinancing bonus

    Open enrollment time. Only one company in our area doing individual plans: AMbetter.

    Cheapest policy is $1800 per month for our family of three. Deductibles are $7900/ person, $15000/ family.

    AMbetter says the plan is NOT HSA compatible. I’m assuming this means we can’t deposit to HSA in 2019, but can use existing money in HSA if we need to.

    How can a plan have deductibles this high and not be HSA compatible? I’ve talked to three insurance brokers (one of them was referred by the state medical association), and they all say AMbetter is the only option in our area. Is there another way?

    #167749 Reply
    jfoxcpacfp jfoxcpacfp 
    Moderator
    Status: Financial Advisor, Accountant, Small Business Owner
    Posts: 6341
    Joined: 01/09/2016

    An HSA-qualified plan must also have maximum OOP amounts that conform to IRS regs. For 2019, the OOP maximum for family coverage is $13,500. I would presume this is the sticking point for your plan (why don’t they make that change ?!?). Yes, you can use your HSA account but, no, you cannot continue to contribute to an HSA if it truly is not HSA compatible.

    Your sole available option is horrendous. Are you stuck in that state?

    Johanna Fox Turner, CPA, CFP, Fox Wealth Mgmt & Fox CPAs ~ 270-247-0555
    https://fox-cpas.com/for-doctors-only/

    #167758 Reply
     No1ofconsequence 
    Participant
    Status: Spouse
    Posts: 8
    Joined: 10/29/2018

    We’re stuck here for the foreseeable future. The individual insurance options have gotten worse every year, and now we’re down to the one poor choice.

    When I read about people retiring early, I wonder how it’s possible when health insurance premiums are so high. $1800 per month is literally more than our mortgage payment.

    #167847 Reply
    jfoxcpacfp jfoxcpacfp 
    Moderator
    Status: Financial Advisor, Accountant, Small Business Owner
    Posts: 6341
    Joined: 01/09/2016
    When I read about people retiring early, I wonder how it’s possible when health insurance premiums are so high. $1800 per month is literally more than our mortgage payment.

    Click to expand…

    In your state, they probably don’t (unless they have a pension with full health bene’s)

    Johanna Fox Turner, CPA, CFP, Fox Wealth Mgmt & Fox CPAs ~ 270-247-0555
    https://fox-cpas.com/for-doctors-only/

    #167848 Reply
     jz 
    Participant
    Status: Physician
    Posts: 599
    Joined: 01/09/2016

    When I read about people retiring early, I wonder how it’s possible when health insurance premiums are so high. $1800 per month is literally more than our mortgage payment.

    I recently attended a medical school reunion.  Everyone with subsidized health policies were retired. eg.  spouse worked for the state, MD worked for the state.     All others are hanging on until Medicare.

    #167850 Reply
    Liked by ReFinDoc, Tim
    DMFA DMFA 
    Moderator
    Status: Physician
    Posts: 2052
    Joined: 06/24/2016

    OOP max, aka catastrophic cap, is too high to qualify for HSA contributions.

    That’s a garbage plan, huge premium for lousy benefits, unless there’s lots of stuff covered before hitting the deductible – in which case it’d be only bad, not garbage.

    Is there *really* nothing better? Is *this* the state of health insurance?

    "I like money." - Frito Pendejo (Idiocracy)

    [Not a financial professional (yet), lawyer, or employee of The White Coat Investor]

    #167872 Reply
    Liked by Peds
     No1ofconsequence 
    Participant
    Status: Spouse
    Posts: 8
    Joined: 10/29/2018
    WCICon18

    That appears to be the only option in our area of Missouri. If anyone knows a better option, please tell me; it’s why I posted.

    I’ve looked every where I know how. Our area lost United Healthcare individual plans two years ago, anthem blue cross blue shield pulled out last year. We have cox health individual plan this year; they’re not doing individual plans in 2019.

    I’ve contacted the state medical association who referred me to one of the three insurance brokers I’ve spoken to. They all say AMbetter is the only option.

    I heard that some Missouri chamber of commerces are offering a MEWA plan for eligible businesses. You have to be a member of the chamber of commerce. I don’t think physician’s LLC’s qualify for membership, although I have sent an email to inquire.

    #167876 Reply
     Bmac 
    Participant
    Status: Physician
    Posts: 252
    Joined: 10/21/2017

    Have you explored health share options? I know little about these, but this review from Michael Kitces site would probably be relatively informative and unbiased.
    https://www.kitces.com/blog/healthcare-sharing-program-review-chm-medicare-lhs-samaritan-health-share-plans/

    #167882 Reply
    Liked by Tim
     caprivenky 
    Participant
    Status: Physician
    Posts: 33
    Joined: 11/27/2016

    No1consequence

    iam in Missouri and have a mewa plan- BCBS

    1. Yes every one can join your local chamber of commerce – around 300$ fee for a year in my local Cof C

    2. I don’t know whether you need one more employee to do a small business plan .

    3 J W Terell is the organizers for these plan – look them up online and they will get you the right agent for your area .

    hope this helps

    “Spend each day trying to be a little wiser than you were when you woke up. Day by day, and at the end of the day-if you live long enough-like most people, you will get out of life what you deserve.”
    ― Charles T. Munger, Poor Charlie's Alman

    #168948 Reply
    Liked by Tim
     Tim 
    Participant
    Status: Accountant
    Posts: 809
    Joined: 09/18/2018

    @jfoxcpacfp,
    In the words of a wise man,

    “Is there *really* nothing better? Is *this* the state of health insurance?”

    Yes for anyone making more than $50k!

    With the demographics, income and claims history available and the regulations, health insurance has the ability to “redline” counties and states.

    Please note that no effort or data is publicized, advertised or promoted. It is nothing but bad news, a necessary evil. The data available manually punching in a zip code.

    Employer healthcare (not necessarily good) and Medicare seem to work. Over 50% of the population doesn’t have that.
    How would one live “like a resident” if residents and fellows had to pay for ACA healthcare plans? The middle class is getting crushed in the name of the uninsured.

    #168958 Reply
     No1ofconsequence 
    Participant
    Status: Spouse
    Posts: 8
    Joined: 10/29/2018

    How did you do insurance through the chamber?

    My local chamber of commerce is saying that the BCBS plan is available for companies with 2 or more employees.

    #170176 Reply
     Flapper 
    Participant
    Status: Dentist
    Posts: 10
    Joined: 12/13/2018

    I am not sure if this is the proper place to post this question and this is my first post.  I have Medishare, a health cost sharing program that’s not insurance and evidently does not make me eligible to put money in an HSA for a stealth IRA agenda.  I am a dentist, make about $200K/year, and have 2 kids under 3 years old.  Is there any way to get around this with my current health plan?  (Like we are able to get around the Roth IRA income cap via a back door Roth…) Thank you!

    #173928 Reply
    Michael @ BattDouglas Michael @ BattDouglas 
    Participant
    Status: Financial Advisor, Insurance Agent
    Posts: 28
    Joined: 04/13/2018

    Great question about funding the HSA without having an HSA compatible health care plan.  (The IRS does not allow you to contribute to an HSA without having the corresponding health insurance.)  There is no “conversion” option for an HSA account at this time for “new” money.

    One area that may cause confusion as you browse the web: You may find references that say you are able to roll from an ira into an HSA once in your lifetime per http://www.irs.gov.  However, this transaction has strings attached per the irs.  If you are not eligible to contribute “new money” to an HSA, you cannot do this rollover.  Furthermore, I suggest that anyone considering this type of transaction, consult a CPA before converting from a traditional ira into your HSA.

    Thanks for sharing.  This is a great question.

    Michael Douglas CLU, CHFC, CFP with the BattDouglas Financial Group
    Direct Phone: (216) 470.2728, [email protected]

    #173958 Reply
    jfoxcpacfp jfoxcpacfp 
    Moderator
    Status: Financial Advisor, Accountant, Small Business Owner
    Posts: 6341
    Joined: 01/09/2016

    I am not sure if this is the proper place to post this question and this is my first post.  I have Medishare, a health cost sharing program that’s not insurance and evidently does not make me eligible to put money in an HSA for a stealth IRA agenda.  I am a dentist, make about $200K/year, and have 2 kids under 3 years old.  Is there any way to get around this with my current health plan?  (Like we are able to get around the Roth IRA income cap via a back door Roth…) Thank you!

    Click to expand…

    Sorry, the health-sharing plans are not compatible with any IRS benefits – only your budget. This has come up several times with clients. If you are at the lower end of the earning spectrum, they can make sense, but I question whether giving up the tax benefits for a qualified health plan makes sense for high-income professionals. It is a very personal calculation, based upon your costs for qualified health insurance and your medical expenses, of course.

    Johanna Fox Turner, CPA, CFP, Fox Wealth Mgmt & Fox CPAs ~ 270-247-0555
    https://fox-cpas.com/for-doctors-only/

    #173970 Reply
     Flapper 
    Participant
    Status: Dentist
    Posts: 10
    Joined: 12/13/2018

    Thank you for the quick reply!  I may need to shop around to see how the cost for qualified health insurance compares now as I have a $5K deductible and a $400 per month share premium that keeps creeping up.  We are a healthy young family of 4…

    Also, are not there a lot of other tax advantaged accounts that I can set up to hit a 20% annual savings rate for retirement.  That comes to $40K per year savings.  The solo 401 K is 18,500 and the back door Roth is 11K for my wife and I.  Any other vehicles to use that I could get up to that 40K mark besides the HSA?

    Thank you!

    #173981 Reply

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