How to take advantage of the system under Obamacare?

[JEDI]

from this thread:
http://forums.anandtech.com/showthread.php?t=2270000

so once Obamacare fully kicks in, how would a savvy person 'maximize' all his new benefits?

 

[Matthiasa]

Depends on certian stipulations on preexisting conditions.
If it covers idiots just going without and say develop heart issues, or waiting to long to get an infection treated, being in a car crash etc.
Then just go without insurance until needed.

Now if conditions were placed on it, that would be different

Though his thread really does mean nothing without knowing what it is starting out.

 

[dullard]

First, the tax is miniscule for the first few years. So small that it is laughable. If you are young and healthy, pay the tax it is cheaper than health insurance.

Second, maximize the HSA. Right now there is NO better investment opportunity in any form whatsoever. With regular investing you pay tax now and pay tax later. With an IRA/401k you pay no tax now, but have a big tax bill later. With a Roth IRA, you pay tax now and pay no tax later. With an HSA, you pay no tax now AND no tax later (assuming you have medical bills later in life).

Third, if you are low income, take the free subsidies for health insurance. Win win in that situation for you.

 

[sactoking]

I can think of about a half dozen legal ways to "take advantage of the system" under the ACA but ethically I cannot divulge how.

 

[Jumpem]

First, the tax is miniscule for the first few years. So small that it is laughable. If you are young and healthy, pay the tax it is cheaper than health insurance.

Second, maximize the HSA. Right now there is NO better investment opportunity in any form whatsoever. With regular investing you pay tax now and pay tax later. With an IRA/401k you pay no tax now, but have a big tax bill later. With a Roth IRA, you pay tax now and pay no tax later. With an HSA, you pay no tax now AND no tax later (assuming you have medical bills later in life).

Third, if you are low income, take the free subsidies for health insurance. Win win in that situation for you.

The problem with an HSA is that you lose unused funds in it at the end of the year. So if you put too much into it actually costs you money.

 

[0roo0roo]

get cancer.

 

[wiredspider]

The problem with an HSA is that you lose unused funds in it at the end of the year. So if you put too much into it actually costs you money.

No that is a FSA, you keep the funds of a HSA...

 

[dullard]

The problem with an HSA is that you lose unused funds in it at the end of the year. So if you put too much into it actually costs you money.

No you are incorrect. Like wiredspider said, you don't lose HSA money. You lose FSA money. Similar abbreviations, night and day difference. HSA money is yours to keep and spend (or invest) as you like for life. If you invest it and then spend it on medical bills later (usually years later to maximize earnings), you get to keep both the principal and the earnings tax free.

 

[sactoking]

The problem with Health Savings Accounts is that you only qualify if you have a high-deductible plan.

 

[dullard]

The problem with Health Savings Accounts is that you only qualify if you have a high-deductible plan.

That usually isn't a bad thing if you run the numbers. High deductible plans are also low monthly payment plans. So, you have plenty of money left for when there is a large need. Also, people with $6250/year to invest probably aren't going to be harmed much by a ~$2400 deductible. If you do need a large payment, then you have the $6250 to use. Although that lowers your potential investment gains, the gains are still there.

 

[SparkyJJO]

The problem with Health Savings Accounts is that you only qualify if you have a high-deductible plan.

For a young guy like me who has no health issues that's fine. The HSA would be there for the high deductible IF I needed it, but other than that I'm saving money per month.

Although, to be honest I don't have an HSA :hmm: I really need to start one.

 

[dullard]

For an example, here were my numbers from 2012:

Standard plan (wife + I):
* $2460 in premiums for the year
* $0 deductible
* $25 copay for almost everything
* $5000 max out of pocket

HSA (wife + I):
* $396 in premiums for the year
* $3000 deductible
* Pay for all non-routine expenses. I'll assume an average of $100 a pop
* $5000 max out of pocket

Now lets consider possible scenarios ranging from low use to catastrophic use. Remember, routine visits (such as a physical, or yearly eye doctor exam) are free under each to encourage preventative medicine, so these visits below are above and beyond the regular checkups.

Low use (4 doctor visits / drugs / etc in a year):
Standard plan: $2460 + 4 * $25 = $2560.
HSA: $396 + 4 * $100 = $796.

Medium use (12 doctor visits / drugs / etc in a year)
Standard plan: $2460 + 12 * $25 = $2760.
HSA: $396 + 12 * $100 = $1596.

High use (24 doctor visits / drugs / etc in a year)
Standard plan: $2460 + 24 * $25 = $3060.
HSA: $396 + 24 * $100 = $2796.

Ultra high use (36 doctor visits / drugs / etc in a year)
Standard plan: $2460 + 36 * $25 = $3360.
HSA: $396 + 36 * $100 = $3996.

Catastrophic use (max out-of-pocket payments)
Standard plan: $5000
HSA: $5000

In only one of the five scenarios did the standard plan save money, and that wan't much savings compared to what the HSA could save in a scenario. Plus, you lose all the tax benefits of the HSA.

 

[LTC8K6]

The free and low cost Obamacare plans are going to be low level plans. Better coverage will cost more.

 

[sactoking]

Remember, this thread is how to take advantage under "Obamacare". Under the ACA HSAs won't be nearly as attractive:
1) The cost-sharing of the various metal tiers will limit the number of HDHP plans available;
2) HSAs will be watered down from their prior incarnations; and
3) HDHP premiums won't be the good "deal" they are now compared to standard plans.

Individual premiums will likely go up 50% or more for those at 250% FPL and above (depending on your state) so people just won't have the cash to dump into the HSA. Making things worse, the more disposable income you have the more your premium will go up since you won't even get the benefit of the paltry 8.5% OOP Max advance premium tax credit. There's actually a really good study out there, I thought it was one Wakely did for Oregon but I just checked and it's not, if I find it I'll link it.

Edit: Well poop. The report was the Wakely report for Oregon, but the specific chart I was thinking of was in the report Gorman did for us. http://exchange.nv.gov/uploadedFile... Insurance Market StudyGormanActuarialLLC.pdf The chart in question is on page 60 and shows the after-subsidy effect on premiums in the individual market based on income, age, health status, gender, and actuarial value.

 

[highland145]

That usually isn't a bad thing if you run the numbers. High deductible plans are also low monthly payment plans. So, you have plenty of money left for when there is a large need. Also, people with $6250/year to invest probably aren't going to be harmed much by a ~$2400 deductible. If you do need a large payment, then you have the $6250 to use. Although that lowers your potential investment gains, the gains are still there.

For whatever reason in SC, the high deductible plans really high. Me+wife+kid, $10K deductible, $428/month, no major health problems (minor BP for me).

+1 on the HSA.

 

[EagleKeeper]

For an example, here were my numbers from 2012:

Standard plan (wife + I):
* $2460 in premiums for the year
* $0 deductible
* $25 copay for almost everything
* $5000 max out of pocket

HSA (wife + I):
* $396 in premiums for the year
* $3000 deductible
* Pay for all non-routine expenses. I'll assume an average of $100 a pop
* $5000 max out of pocket

Now lets consider possible scenarios ranging from low use to catastrophic use. Remember, routine visits (such as a physical, or yearly eye doctor exam) are free under each to encourage preventative medicine, so these visits below are above and beyond the regular checkups.

Low use (4 doctor visits / drugs / etc in a year):
Standard plan: $2460 + 4 * $25 = $2560.
HSA: $396 + 4 * $100 = $796.

Medium use (12 doctor visits / drugs / etc in a year)
Standard plan: $2460 + 12 * $25 = $2760.
HSA: $396 + 12 * $100 = $1596.

High use (24 doctor visits / drugs / etc in a year)
Standard plan: $2460 + 24 * $25 = $3060.
HSA: $396 + 24 * $100 = $2796.

Ultra high use (36 doctor visits / drugs / etc in a year)
Standard plan: $2460 + 36 * $25 = $3360.
HSA: $396 + 36 * $100 = $3996.

Catastrophic use (max out-of-pocket payments)
Standard plan: $5000
HSA: $5000

In only one of the five scenarios did the standard plan save money, and that wan't much savings compared to what the HSA could save in a scenario. Plus, you lose all the tax benefits of the HSA.

when staying healthy; the HSA comes out ahead.

Toss in an ambulatory run and and ER visit and you have another 2-3K easily.

If you have 4-5 years clean under the HSA, then you can build up to cover the overhead.

Otherwise; you are starting from a hole.

And the more dependents you have the higher the chance that the "catastrophe" will happen.

 

[Sluggo]

HSA (wife + I):
* $396 in premiums for the year
* $3000 deductible
* Pay for all non-routine expenses. I'll assume an average of $100 a pop
* $5000 max out of pocket

Looks like a great rate, who is your provider for this?

 

[dullard]

Looks like a great rate, who is your provider for this?

United Health Care. Both rates were probably subsidized by the employer.

 

[shortylickens]

from this thread:
http://forums.anandtech.com/showthread.php?t=2270000

so once Obamacare fully kicks in, how would a savvy person 'maximize' all his new benefits?

WRONG FORUM!!

 

[Aikouka]

I think I had a FSA at my previous employer, but I can't remember exactly. I had no co-pay up to a certain amount covered, and I forget what it was like after that. I rarely ever used it.

 

[DCal430]

First, the tax is miniscule for the first few years. So small that it is laughable. If you are young and healthy, pay the tax it is cheaper than health insurance.

Second, maximize the HSA. Right now there is NO better investment opportunity in any form whatsoever. With regular investing you pay tax now and pay tax later. With an IRA/401k you pay no tax now, but have a big tax bill later. With a Roth IRA, you pay tax now and pay no tax later. With an HSA, you pay no tax now AND no tax later (assuming you have medical bills later in life).

Third, if you are low income, take the free subsidies for health insurance. Win win in that situation for you.

Not really, for significant percent of households the subsidies will bring the insurance down to at or below the penalty cost.

 

[Craig234]

I can think of about a half dozen legal ways to "take advantage of the system" under the ACA but ethically I cannot divulge how.

I like you more than the OP.

How about being a good person and citizen? I know which party he sounds to fit in.

 

[alkemyst]

All it's going to do is open the door to more people willing to scam the system. Down here in S. Florida where an ungodly skewed amount of medicare/aide claims are paid, the easy scam as one where english is not your first language is to go to one of the clinics or worse the ER and comphrehend no english. Once your advocate has been assigned claim you just arrived and are homeless/staying at an half-way house/shelter. Free health care for the win (and our loss).