FEHB Aetna HDHP

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faltuk1
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FEHB Aetna HDHP

Post by faltuk1 »

I have been with Aetna HDHP for last 2 years. The premiums have gone quite considerably in last 2 years. Any opinion on HDHP plans in FEHB. I live in Northern Virginia and non postal.
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Re: FEHB Aetna HDHP

Post by BruDude »

What do you want to know?
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grabiner
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Re: FEHB Aetna HDHP

Post by grabiner »

The FEHB (US Government) offers several HDHP plans, so you can choose one of the plans based on the exact benefits it offers and whether the doctors you need are in-network. Once you have decided to use, say, Aetna, you will probably find that Aetna's HDHP is a better deal that Aetna's conventional plan.

All of the FEHB high-deductible plans are very good deals, because of the way the Government subsidizes the plans. The Government pays 75% of the cost of a plan, up to a limit which is more than any of the HDHP plans cost. Therefore, if the main reason that the HDHP costs more than a conventional plan is that the HDHP puts $720 into your HSA, you only pay $180 of your own money to get that $720 into the HSA.
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ChrisC
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Re: FEHB Aetna HDHP

Post by ChrisC »

grabiner wrote:All of the FEHB high-deductible plans are very good deals, because of the way the Government subsidizes the plans. The Government pays 75% of the cost of a plan, up to a limit which is more than any of the HDHP plans cost. Therefore, if the main reason that the HDHP costs more than a conventional plan is that the HDHP puts $720 into your HSA, you only pay $180 of your own money to get that $720 into the HSA.
I'm not sure I understand fully what you're saying here as someone who was previously under the Aetna HDHP-HSA, with my former agency subsidizing 85 percent of the cost of the plan. I understand the subsidy; I understand my HSA contributions and the tax benefits; I understand my employer's contribution to the HSA ($1500); I understand the good coverage of the HDHP once you've reached the deductible or the maximum limitations. What I don't understand is the above underscored portion of your statement. Please elaborate. Are you simply suggesting that my annual HDHP premium of around $900 last year yielded me $1500 in annual employer contributions to my HSA?
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grabiner
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Re: FEHB Aetna HDHP

Post by grabiner »

ChrisC wrote:
grabiner wrote:All of the FEHB high-deductible plans are very good deals, because of the way the Government subsidizes the plans. The Government pays 75% of the cost of a plan, up to a limit which is more than any of the HDHP plans cost. Therefore, if the main reason that the HDHP costs more than a conventional plan is that the HDHP puts $720 into your HSA, you only pay $180 of your own money to get that $720 into the HSA.
I'm not sure I understand fully what you're saying here as someone who was previously under the Aetna HDHP-HSA, with my former agency subsidizing 85 percent of the cost of the plan. I understand the subsidy; I understand my HSA contributions and the tax benefits; I understand my employer's contribution to the HSA ($1500); I understand the good coverage of the HDHP once you've reached the deductible or the maximum limitations. What I don't understand is the above underscored portion of your statement. Please elaborate. Are you simply suggesting that my annual HDHP premium of around $900 last year yielded me $1500 in annual employer contributions to my HSA?
Your insurance premium covers 75% of the cost of the plan, whatever plan it is (up to a limit). Thus you have a significant incentive to choose a more expensive plan, since you pay only 25% of the cost but get 100% of the benefits. Most of the HDHP plans are more expensive than the corresponding conventional plans, because they provide insurance and also make a contribution to the HSA; this makes them particularly attractive because you get a larger subsidy. (Aetna appears to be an exception; the Virginia Aetna HealthFund Value Plan is less expensive than the HDHP, according to http://www.opm.gov/healthcare-insurance ... al-hmo.pdf) In fact, it is common for an HDHP to be better than a conventional plan from the same insurer even if you use the entire high deductible.
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Re: FEHB Aetna HDHP

Post by ChrisC »

grabiner wrote:
ChrisC wrote:
grabiner wrote:All of the FEHB high-deductible plans are very good deals, because of the way the Government subsidizes the plans. The Government pays 75% of the cost of a plan, up to a limit which is more than any of the HDHP plans cost. Therefore, if the main reason that the HDHP costs more than a conventional plan is that the HDHP puts $720 into your HSA, you only pay $180 of your own money to get that $720 into the HSA.
I'm not sure I understand fully what you're saying here as someone who was previously under the Aetna HDHP-HSA, with my former agency subsidizing 85 percent of the cost of the plan. I understand the subsidy; I understand my HSA contributions and the tax benefits; I understand my employer's contribution to the HSA ($1500); I understand the good coverage of the HDHP once you've reached the deductible or the maximum limitations. What I don't understand is the above underscored portion of your statement. Please elaborate. Are you simply suggesting that my annual HDHP premium of around $900 last year yielded me $1500 in annual employer contributions to my HSA?
Your insurance premium covers 75% of the cost of the plan, whatever plan it is (up to a limit). Thus you have a significant incentive to choose a more expensive plan, since you pay only 25% of the cost but get 100% of the benefits. Most of the HDHP plans are more expensive than the corresponding conventional plans, because they provide insurance and also make a contribution to the HSA; this makes them particularly attractive because you get a larger subsidy. (Aetna appears to be an exception; the Virginia Aetna HealthFund Value Plan is less expensive than the HDHP, according to http://www.opm.gov/healthcare-insurance ... al-hmo.pdf) In fact, it is common for an HDHP to be better than a conventional plan from the same insurer even if you use the entire high deductible.
Actually, the federal employee's premium for the Aetna HDHP has been significantly lower than the premium for a traditional plan. It's one of the great draws to an HDHP if you're very healthy and have little medical expenses. Over the last 6 years, as an employee, I paid around $32-36 bi-weekly for the Aetna HDHP for family coverage. The premium for a bare-bones traditional plan was at least twice Aetna's premium, last time I comparison shopped. For 5 of those years, I had minimum medical expenses (except for LTCi that I paid outside of the plan). For those 5 years, the employer's annual contribution of $1500 to my HSA was actually greater than all of my medical expenses (except the LTCi premium).

One year we had knee replacement surgery and high medical expenses due to the surgery. I'm not sure the Aetna HDHP was a better plan for us for that year, though comparison tools like Consumers Checkpoint said that Aetna HDHP was better for us than Basic BlueCross for that year.
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Re: FEHB Aetna HDHP

Post by grabiner »

ChrisC wrote:Actually, the federal employee's premium for the Aetna HDHP has been significantly lower than the premium for a traditional plan.
This varies by provider, but I checked and confirmed this.

But it would actually be better if the HDHPs cost more and made larger HSA contributions, as government employees would pay only 25% of the cost.
It's one of the great draws to an HDHP if you're very healthy and have little medical expenses. Over the last 6 years, as an employee, I paid around $32-36 bi-weekly for the Aetna HDHP for family coverage. The premium for a bare-bones traditional plan was at least twice Aetna's premium, last time I comparison shopped. For 5 of those years, I had minimum medical expenses (except for LTCi that I paid outside of the plan). For those 5 years, the employer's annual contribution of $1500 to my HSA was actually greater than all of my medical expenses (except the LTCi premium).

One year we had knee replacement surgery and high medical expenses due to the surgery. I'm not sure the Aetna HDHP was a better plan for us for that year, though comparison tools like Consumers Checkpoint said that Aetna HDHP was better for us than Basic BlueCross for that year.
Agreed, and you can work out the numbers. With the government subsidies and the IRS incentive for the HSA, you may actually have come out ahead anyway; the $1500 contributed to your HSA was free money, and the extra contribution of about $4500 (depending on the year) exempt from federal, state (in most states), and FICA and Medicare if paid by payroll deduction, may have saved you another $2000. You used the entire deductible, but with a basic plan, you would have paid a fair amount anyway.
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Re: FEHB Aetna HDHP

Post by TimeRunner »

I've had GEHA HDHP the last three years. Not great if you have prescription drugs, but otherwise it's a good plan. Compare before you default to Aetna.
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