HRA Insurance

[VisionaryMom]

DH had a meeting today w/ people from their HR dept. They're going to an HRA plan w/ $2500 deductible, $2000 contribution from employer. I'm not feeling 100% today, so I don't know if that's why, but for some reason that just doesn't make sense to me. What's the difference between this and traditional insurance?

[chistinawc]

Just a few seconds to type, but we have an HRA, and that means we have $1500 (I think) available to us to pay co-pays, prescriptions, etc. So the first $1500 is free each year. And if we don't use it all, it carries over. The deductible is rough, but it only affected it once b/c dh had a colonscopy and then ds had cleft surgery in the same year. Still we only had to pay out $700. And we hadn't paid any copays or anything else the rest of the year, and our premiums are low - lower anyway. I was really nervous about the plan, but it's worked out well for us.

[VisionaryMom]

Thanks. I have a clearer idea, though I'm not sure it will be financially beneficial to us. Looking at it, the insurance part does cover some things that our old insurance didn't - Pap smears, for instance. :grr

We'll have $2000 off the top to use. Then I believe DH said our deductible is $2500 per person, $5000 for the family. DH has T1 diabetes, and I have bipolar disorder, so I think we'll go above the $2K mark. I was in the hospital this year, and our portion was ~$1500 from that, and that was 20% of the cost.

Our old plan covered diagnostics @ 100%, though, and this plan doesn't. They're part of the deductible. DD had x-rays when she had pneumonia that were around $500 for 2 chest images.

This plan also looks to have NO prescription coverage, which with the diabetes is killer. DH has 6 regular prescriptions - 2 insulins, 2 types of needles, test strips, & cholesterol meds. Our copay right now is around $120 a month, but Lantus alone actually costs close to $300 before insurance.

Sorry for the all the unnecessary medical detail. Can you tell how much we pay out in medical costs annually? I've really been pushing w/ DH for us to look into holistic care. He initially balked but has started to research on his own and come around. : (Yeah, I've been waiting for an excuse to use that smiley.) So, maybe this will encourage him.

As far as finances go, I'm thinking we should be putting away $425 a month to cover the annual family deductible each year. Then we can just reimburse the fund if needed. That may be easier/better than waiting for a problem.

The rep did say the premiums would be lower, but they didn't have an exact price. Right now we pay $550 per month, plus a $1.50/hour pay cut (so $240 a month if he works only 40 hours a week). We're really getting tanked on medical costs.

[allborntogrow]

HRAs are great plans for people who don't see the Dr. often and don't have a lot of prescriptions they fill regularly. Things like Well Baby and Preventative are usually covered 100%. The coverage and network is often the same as a traditional PPO, so you have a lot of flexibility there. You get all this and the premiums are usually lower.

We fit in to this category perfectly. We had an HRA for three years (I only just changed because we were having another baby and the deductible was lower) and didn't pay a penny (besides the premiums) for healthcare for that three years. Our HRA was only 1100, too. I am going to switch back to the HRA during open enrollment.

However, it sounds like you guys may go above that 2000 you get (although that's a good amount). To figure out if it is worth it, calculate the monthly premiums for a traditional plan, and if it's over the 5000 deductible, you may want to stick with the HRA because once you've paid that deductible many HRAs will kick in 100%. However, if the premiums for a traditional plan aren't that much more, it may be worth it to pay the extra every month and have a lower deductible and better prescription coverage.

As far as prescription, most HRAs don't have a plan. Your prescriptions (at full cost) will be deducted from your HRA until it's used up. So if you have a 70 dollar per month prescription, that's 840 a year. That's almost half of your HRA. That's why HRAs are not the best idea for people with a lot of prescriptions.

Good luck! I actually work in benefits so if you have more questions I may be able to help out.

[VisionaryMom]

Originally Posted by allborntogrow

HRAs are great plans for people who don't see the Dr. often and don't have a lot of prescriptions they fill regularly.

That's what it looks like to me. DH got some clarification today. Our deductible will be $5000, but the company will pay $2000 of that. We'll put $2500 in a flexible spending account and then pay the other $500 out of pocket. Then the insurance will kick in at 100% of everything. We definitely will hit the $5000 every year.

My therapy visits are twice monthly @ $300 billed each time. Right now I need them, but the way our state works I have to have them at some interval to keep seeing a pdoc anyway. And I need the psych meds.

I figure even if DH's prescriptions average $25 each, that's $150 a month, or $1800 a year right there. Bleh.

Unfortunately the premiums are HIGHER than they were before, so that won't be the benefit I thought. They kept talking about the "lower premiums" in the presentation, but that was only if you were single, childless, and had basic coverage. If you have a family, you're paying more. I want to cry.

Of course they're so generous that we have until Friday to make a decision. I'm self-employed. We could look into union-sponsored insurance, but I don't know that I could get it together by Friday. Do you know if another plan becoming available through a spouse's work counts as a "life event" to change other than at open enrollment?

The new insurance plan starts October 1, so they'll give us $2000. Will that roll over if we don't use it all?

[allborntogrow]

Any HRA I've worked with rolls over, but you'd want to clarify with your husband's HR dept.

Some employers do allow you to cancel your insurance if it becomes available through a spouse's work. However, this is something that you'll have to check. At my work this doesn't qualify as a life event, but at my sister's it does.

Like I said in a previous post 2000 for an HRA is actually really good. That means your part of the deductible is 3000, which is comparable to most traditional plans. As long as you're sure that the insurance will kick in 100 percent after the 5000 it sounds like a fairly good plan. Just out of curiousity what's the coverage like on the traditional plan that's offered?

[34me]

We had an HRA for two years. Because my husband has allergies/asthma and is on 4 perscriptions a month and we only got $900 a year for all five of us it was horrid. We then had to spend $2500 before they would kick in any more. We spent that $900 in three months but then never got to the $2500 for the year.

One thing that can really help out is to shop around for your perscription costs. Because you are essentially spending your own money it pays to really shop around. Also if at all possible get perscriptions for meds in strengths that are twice as strong and use a pill splitter. So that way for one price you get two months worth.

[VisionaryMom]

Originally Posted by allborntogrow

Any HRA I've worked with rolls over, but you'd want to clarify with your husband's HR dept.

He has a call in to the broker's office, which is who they're supposed to ask. We're hoping to hear back today. The guy originally said we'd get $2000 in our account on October 1 to last until Dec. 31, but an email from someone in HR said the $ was for Oct 1 to Sept 30. So apparently they both say it rolls over but aren't clear on the dates.

Originally Posted by allborntogrow

Some employers do allow you to cancel your insurance if it becomes available through a spouse's work. However, this is something that you'll have to check. At my work this doesn't qualify as a life event, but at my sister's it does.

I'll have him ask. I thought those were standard things, so we'll cross our fingers on that if we need to look into it. Unfortunately the company's HQ is in a different state from us, so it's really hard to get answers from them on anything since he's really just a number to them.

Originally Posted by allborntogrow

As long as you're sure that the insurance will kick in 100 percent after the 5000 it sounds like a fairly good plan. Just out of curiousity what's the coverage like on the traditional plan that's offered?

DH said they told them (they didn't provide paperwork, so it makes me leery) that it's 100% but for some major things they have a limit ($15,000 for a hospital visit, for instance).

The traditional plan we've had has been great on some things. Well-child, all lab work and diagnostic images are covered @ 100%. We have a $1000 ind/$2500 family deductible, though there's very little that counts toward the deductible. Copays are $20 regular, $40 specialist, $75 urgent care, $200 ER. We pay 20% of all hospital stays & ER/urgent care visits.

Our prescription co-pays are $10, $25, $35. The odd thing about the HRA is that we have to call local pharmacies to see who offers the best deal w/ Humana on each of the prescriptions DH has. I find it odd that there's no set cost, and it's one more thing for my to do list that I really don't have time for.

Overall I feel better than I did when they first announced it. At the very least, we pretty much know what we're paying overall. DH will have $2500 a year taken out for flex and then we'll put $500 in an account to cover the remainder of the deductible. That should be it for the year. I was in the hospital for DD's birth in 2007 and in a psych hospital this year, and neither bill came to $15K, so I think we're okay there, too, barring any catastrophic illness.

[VisionaryMom]

Originally Posted by 34me

We had an HRA for two years. Because my husband has allergies/asthma and is on 4 perscriptions a month and we only got $900 a year for all five of us it was horrid. We then had to spend $2500 before they would kick in any more. We spent that $900 in three months but then never got to the $2500 for the year.

I told DH it seems the insurance companies make out like bandits on this. We're paying $535 a month in premiums, and we have to spend $5K (granted, $2K is the company's, but we do take a huge salary reduction for it) before the insurance will pay a dime!

Originally Posted by 34me

One thing that can really help out is to shop around for your perscription costs. Because you are essentially spending your own money it pays to really shop around. Also if at all possible get perscriptions for meds in strengths that are twice as strong and use a pill splitter. So that way for one price you get two months worth.

Unfortunately his most expensive meds are the insulin, which can't be doubled. There are some other things we're looking into to cut the costs, but I'm almost afraid to call to find out what the price is going to be.

[allborntogrow]

What did you decide to do?