Health Savings Account (HSA) Question

[throwittoblythe]

I have a question about HSAs.

Here's my situation: A company is recruiting me to join. Their health insurance plan reads like a High Deductible Health Plan (HDHP), but isn't called that in their documents. $4,000 individual and $8,000 family deductibles. I've read the IRS rules for definition of a High Deductible Plan, but can't tell how it works, exactly. To me, that's an HDHP plan and I could set my own HSA with my bank. But maybe I'm wrong?

Here's the basic question: Does the provider need to define the plan as a High Deductible Plan to establish in HSA? Are there plans that qualify for an HSA, where you have to set up your own account with a bank?

 

[Bestaluckcy]

This may help: https://www.healthcare.gov/glossary/high-deductible-health-plan/

 

[throwittoblythe]

This may help: https://www.healthcare.gov/glossary/high-deductible-health-plan/

Thanks. This is what I read and got confused:

"For 2022, the IRS defines a high deductible health plan as any plan with a deductible of at least $1,400 for an individual or $2,800 for a family. An HDHP’s total yearly out-of-pocket expenses (including deductibles, copayments, and coinsurance) can’t be more than $7,050 for an individual or $14,100 for a family. (This limit doesn't apply to out-of-network services.)"

To me, that says this plan I'm looking at ($4,000 individual, $8,000 family deductible and $12,700 out of pocket max) meets the criteria for a HDHP. It's just weird to me that it's not called that on any of their documents. Makes me think I'm missing something.

 

[JP4CY]

Wife and I have separate and very different health carriers so I wouldn't know much about that. I do know her HSA is actually a credit card and she can use it for A LOT of stuff.

 

[keepngoal]

Thanks. This is what I read and got confused:

"For 2022, the IRS defines a high deductible health plan as any plan with a deductible of at least $1,400 for an individual or $2,800 for a family. An HDHP’s total yearly out-of-pocket expenses (including deductibles, copayments, and coinsurance) can’t be more than $7,050 for an individual or $14,100 for a family. (This limit doesn't apply to out-of-network services.)"

To me, that says this plan I'm looking at ($4,000 individual, $8,000 family deductible and $12,700 out of pocket max) meets the criteria for a HDHP. It's just weird to me that it's not called that on any of their documents. Makes me think I'm missing something.

its a HDHP.

 

[NWICY]

I have a question about HSAs.

Here's my situation: A company is recruiting me to join. Their health insurance plan reads like a High Deductible Health Plan (HDHP), but isn't called that in their documents. $4,000 individual and $8,000 family deductibles. I've read the IRS rules for definition of a High Deductible Plan, but can't tell how it works, exactly. To me, that's an HDHP plan and I could set my own HSA with my bank. But maybe I'm wrong?

Here's the basic question: Does the provider need to define the plan as a High Deductible Plan to establish in HSA? Are there plans that qualify for an HSA, where you have to set up your own account with a bank?

Would this be a situation where you could ask their human resources department to clarify the situation. It seems to me if they are recruiting you you should have plenty of leeway to ask for clarifications. Full disclosure I haven't interviewed for a long time.

 

[Bader]

Publication 969 (2022), Health Savings Accounts and Other Tax-Favored Health Plans | Internal Revenue Service

www.irs.gov

As long as your deductible is above the defined minimums you can contribute to a HSA

 

[throwittoblythe]

Would this be a situation where you could ask their human resources department to clarify the situation. It seems to me if they are recruiting you you should have plenty of leeway to ask for clarifications. Full disclosure I haven't interviewed for a long time.

It's a small company so there is no HR department. I figured CF would know the answer faster than asking the founder to ask his HR firm.

 

[keepngoal]

HSA is a triple win. Good luck at the new job.

 

[throwittoblythe]

HSA is a triple win. Good luck at the new job.

I'm a big fan. I was honestly a little worried that their plan wasn't an HSA. I've worked at a few places that did/did not have HSA's and I really do like them.

 

[Cyinthenorth]

Publication 969 (2022), Health Savings Accounts and Other Tax-Favored Health Plans | Internal Revenue Service

www.irs.gov

As long as your deductible is above the defined minimums you can contribute to a HSA

This is not always true. My health insurance is within the deductible limits to be HSA Eligible, but I can't contribute because my company doesn't define it as HSA Eligible. Something to do with having copays whereas the HDHP they do offer does not have copays.

 

[throwittoblythe]

This is not always true. My health insurance is within the deductible limits to be HSA Eligible, but I can't contribute because my company doesn't define it as HSA Eligible. Something to do with having copays whereas the HDHP they do offer does not have copays.

This is really interesting and hits at what I was wondering. Everything meets the criteria, but they don't call it a HDHP and don't offer an HSA. Any HDHP plans I've ever heard of offer an HSA account with the HDHP.

Your comment is kind of what I thought: that this isn't an HSA-eligible plan.

 

[OldEagle]

Thanks. This is what I read and got confused:

"For 2022, the IRS defines a high deductible health plan as any plan with a deductible of at least $1,400 for an individual or $2,800 for a family. An HDHP’s total yearly out-of-pocket expenses (including deductibles, copayments, and coinsurance) can’t be more than $7,050 for an individual or $14,100 for a family. (This limit doesn't apply to out-of-network services.)"

To me, that says this plan I'm looking at ($4,000 individual, $8,000 family deductible and $12,700 out of pocket max) meets the criteria for a HDHP. It's just weird to me that it's not called that on any of their documents. Makes me think I'm missing something.

Concur. It's a HDHP. 15 years in HR.

 

[throwittoblythe]

Concur. It's a HDHP. 15 years in HR.

Just so I'm clear as I'm considering this as part of the comp package...

Even if they don't call it an HDHP and they don't offer an HSA account as part of it BUT it meets those IRS criteria, I can set up an HSA on the side through my bank? Is there anything special I need to do there?

 

[BryceC]

It's just weird to me that it's not called that on any of their documents. Makes me think I'm missing something.

People have very negative feelings about HDHP's, so they probably don't want to use that language.

My HSA account is just set up though the health plan so I can't help you there.

 

[isufbcurt]

Just so I'm clear as I'm considering this as part of the comp package...

Even if they don't call it an HDHP and they don't offer an HSA account as part of it BUT it meets those IRS criteria, I can set up an HSA on the side through my bank? Is there anything special I need to do there?

I've had clietns who set up their own HSA through their bank

 

[MuskieCy]

I have clients who can't make tax-deferred IRA contributions make tax-deferred contributions to an HSA.

Disbursements fro an HSA are tax-free when used for proper medical expenses and are taxed as ordinary income when not used for medical expenses.