It's open enrollment time at my employ, and while the Mrs and I are decided and done, it seems that most folks have hardly logged on. Since we're going through the second major plan overhaul in 3 years, people have TONS of questions and no clue as to which one to choose.

The Providers and their vague presentations and explanations have come and gone and folks are still sitting around at lunch saying, "I don't know what to pick." Now, I don't intend to demean these folks. Modern health care is quite complicated and an incredible amount of responsibility is in the lap of the consumer. This is a difficult and important decision - more now than ever.

My response, usually starts with, "Here's how we decided..."


First, a little backstory:
We have two options for employer sponsored health insurance. One plan is like a PPO, but they have added some hoops to jump through. The other is an HSA. To make this decision, you really need to know three things about the plans:

• The Deductible (the amount you are responsible for before the insurance actually kicks in)
• The Premium (the amount that you kick - monthly, yearly, whenever)
• The Out-of-Pocket limit (the co-insurance amount you are responsible for above the deductible)
  

Here are the numbers for our plans (these are for employee and family):

PPO		HSA
$1,000	Deductable (per yr)	$4,000
$X + $70	Premium (per mo.)	$X
$4,000	Out-of-Pocket Limit (per yr)	$4,000

For this example, you can assume that most other details are equal. As you can see, the PPO has higher premiums ($840 per year), but the deductible is $3,000 less than the HSA. The out-of-pocket limits are the same, making that part irrelevant. So what does all this mean? "Well, here's how we decided..."

For two years running, we've hit our out-of-pocket limit in April or May. Lately, we've been what they refer to as 'heavy users of insurance'. We don't have chronic ailments, but we did have a baby last year. And this year, we had 3 ER trips. the net result of 2 busy kids and 2 active parents. We're healthy people, but lately we've been quite accident prone.

Really, each employee has to make a gamble. either we choose the PPO and plan on using up the low deductible, or we choose the HSA and hope hardly see the doctor all year (thus taking advantage of putting in less per month). While we like the idea of rolling over unused HSA funds to the next year, so far that hasn't been a reality.

We chose the PPO.

Is it right for everyone? Definitely not. A greater difference in the premiums would make the HSA more attractive. This is especially true with a fully-funded emergency fund. We could use it to cover $4k in medical expenses, but that also means that the EF would be depleted and not able to be use for other emergencies.

What has your experience been? Does the HSA work for you or your family?