HDHP during pregnancy?

[Osterix]

Hello. I've read the other forum posts on the topic, but I would appreciate help looking at the numbers for my specific situation.

My wife is expecting our second child with a due date in June 2021. We are currently on a HDHP. I am an independent contractor and fortunately the organization that I'm contracted with pays my monthly health insurance premiums. I'd like input on staying on the HDHP for the pregnancy or switching to the PPO Premium plan for the first half of 2021 and then switching back to the HDHP after the birth (in order to contribute the $7,200 to the HSA), since it is a qualifying event. We are currently very light users of medical services as my wife, myself and 15 month old are healthy.

PPO Premium Plan (In-Network) PPO HDHP (In-Network)

Coinsurance (Member pays) 20% Coinsurance (Member pays) 0%

Calendar Year Deductible Calendar Year Deductible
- Individual (In-network): $750 - Individual (In-network): $3,000
- Family (In-network): $1,500 - Family (In-network): $6,000

Out-of-Pocket Maximum Out-of-Pocket Maximum
(Deductible included) (Deductible included)
- Individual: $4,000 - Individual: $4,000
- Family: $8,000 - Family: $8,000

Office Visit Office Visit
- Primary: $25 Copay - Primary: Deductible
- Specialist: $50 Copay - Specialist: Deductible
- Preventive: 100% Covered - Preventive: 100% Covered

Inpatient Services:20% after Deductible Inpatient Services: Deductible

Outpatient Services:20% after Deductible Outpatient Services: Deductible

Emergency Room Services: $150 Copay Emergency Room Services: Deductible
(Waived if admitted) (Waived if admitted)

Urgent Care: $60 Copay Urgent Care: Deductible

From my interpretation, I don't think it would be difficult to get to $8,000 OOP maximum on the PPO Premium plan with a two day inpatient stay. Opinions welcome.

[123]

Young children can consume a lot of medical care (not all preventative). Having a pregnancy or two young children in the household can increase use of medical care. If one gets sick frequently the other does as well. Perhaps the deductible on the HDHP plan doesn't stress you but if I had a pregnancy or two children under 12 I don't think I would go with the HDHP, in spite of the allure of the HSA. Some pregnancies can result in enduring medical consequences.

If you're not footing the bill for health insurance premiums I wouldn't be driven by the HSA.

[classicindexer]

If you only have the HDHP for part of the year, I believe that your max HSA contribution has to be prorated based on the months that you were covered by the HDHP which may only be six months (July-Dec) in your example.

Have you also compared your monthly contribution cost difference between the HDHP and PPO plans? With my employer it is drastically different ($215 vs. $400 bi-weekly). I couldn’t tell from your post if you have any payroll contributions to the HDHP or PPO plan.

EDIT: Does your insurance company offer any cost comparison tools between the plans? My spouse's had one for a natural birth delivery and in our situation we opted to keep the HDHP w/HSA since the deductibles were close. Her prenatal office visits + ultrasounds were not covered as preventative by the HDHP so those also counted towards the deductible/OOP max for the year. I believe that most of the hospital expense for the delivery went towards my wife's deductible since there were no complications for her or our child.

[DarkHelmetII]

If you only have the HDHP for part of the year, I believe that your max HSA contribution has to be prorated based on the months that you were covered by the HDHP which may only be six months (July-Dec) in your example.

My understanding is that if you are in HDHP in subsequent year you can fully fund HSA in the preceding year. I also remember some caveat, however, that HDHP in previous year had to start at some point before Dec 31 such as Dec 1.

[Osterix]

If you only have the HDHP for part of the year, I believe that your max HSA contribution has to be prorated based on the months that you were covered by the HDHP which may only be six months (July-Dec) in your example.

Have you also compared your monthly contribution cost difference between the HDHP and PPO plans? With my employer it is drastically different ($215 vs. $400 bi-weekly). I couldn’t tell from your post if you have any payroll contributions to the HDHP or PPO plan.

I was under the impression too that you could only contribute to the HSA for the number of months you were enrolled in the HDHP (ex. I might only be on the HDHP 6 months next year so $7,200/2 = $3,600. However, I started my job in September 2019, and the HDHP, and contributed the full $7,000 to the HSA for 2019, and I have been on the HDHP all of 2020.

I do not contribute any payroll contributions. The monthly cost for a family on PPO plan is $1,575 and the HDHP is $1,260; again these monthly premiums are paid entirely by the company I am contracted with.

[classicindexer]

Hi Osterix: I edited my first post to add this:

Does your insurance company offer any cost comparison tools between the plans for services received? My spouse's had one for a natural birth delivery and in our situation we opted to keep the HDHP w/HSA since the deductibles were close. Her prenatal office visits + ultrasounds were not covered as preventative by the HDHP so those also counted towards the deductible/OOP max for the year. I believe that most of the hospital expense for the delivery went towards my wife's deductible since there were no complications for her or our child.

Is the out of pocket max indeed the same between your two plans? Mine aren't, my HDHP has a higher deductible and lower OOP max and when we had my wife's the OOP max was higher on the HDHP.

[Osterix]

If you only have the HDHP for part of the year, I believe that your max HSA contribution has to be prorated based on the months that you were covered by the HDHP which may only be six months (July-Dec) in your example.

My understanding is that if you are in HDHP in subsequent year you can fully fund HSA in the preceding year. I also remember some caveat, however, that HDHP in previous year had to start at some point before Dec 31 such as Dec 1.

https://healthsavings.com/contribute-hs ... e-changes/

I just read this article and learned about the "the last month rule", which is why I was able to contribute the full $7,000 in 2019 because I've been on the HDHP all of 2020.

[Osterix]

Hi Osterix: I edited my first post to add this:

Does your insurance company offer any cost comparison tools between the plans for services received? My spouse's had one for a natural birth delivery and in our situation we opted to keep the HDHP w/HSA since the deductibles were close. Her prenatal office visits + ultrasounds were not covered as preventative by the HDHP so those also counted towards the deductible/OOP max for the year. I believe that most of the hospital expense for the delivery went towards my wife's deductible since there were no complications for her or our child.

Is the out of pocket max indeed the same between your two plans? Mine aren't, my HDHP has a higher deductible and lower OOP max and when we had my wife's the OOP max was higher on the HDHP.

According to the benefits summary I received today, the OOP max for individual and family is the same for both the PPO and the HDHP, which makes me think the HDHP is "better" overall since I have the HSA access. I do not have the full summary plan yet to dive deeper into the details.

[Osterix]

Young children can consume a lot of medical care (not all preventative). Having a pregnancy or two young children in the household can increase use of medical care. If one gets sick frequently the other does as well. Perhaps the deductible on the HDHP plan doesn't stress you but if I had a pregnancy or two children under 12 I don't think I would go with the HDHP, in spite of the allure of the HSA. Some pregnancies can result in enduring medical consequences.

If you're not footing the bill for health insurance premiums I wouldn't be driven by the HSA.

Regarding the last point, wouldn't I be more likely to be driven by the HSA if I am not footing the bills?

Based on the premiums for the family plan, it would cast $18,900 annual for the PPO plan versus $15,120 annual for the HDHP. That is a savings of $3,780 alone in premiums before considering any deductible payment.

[megabad]

I don’t like to make generalizations, but I would say that in a birth year I would probably go PPO in most cases. Especially when the coverage appears abnormally good for very little increase in premiums which seems like your case.

[tashnewbie]

How much was the cost for the 1st birth?

Is there some way for you to get an estimate of the all-in costs for the 2nd birth?

It's very surprising to me that the OOP max is the same for the PPO Premium and HDHP.

[Osterix]

How much was the cost for the 1st birth?

Is there some way for you to get an estimate of the all-in costs for the 2nd birth?

It's very surprising to me that the OOP max is the same for the PPO Premium and HDHP.

Fortunately, the first birth was on a different medial plan in a different state. We were actually on COBRA at the time for two months. Outside of the two months of expensive COBRA premiums, only cost $250, which was the copay for an inpatient admission.

[Osterix]

I think the reason I am primarily asking the question is that I am thinking worst case scenario I hit the OOP maximum which is the same for both plans. If I indeed hit the OOP maximum, it seems that the having the HSA is a logical choice.

[tashnewbie]

I think the reason I am primarily asking the question is that I am thinking worst case scenario I hit the OOP maximum which is the same for both plans. If I indeed hit the OOP maximum, it seems that the having the HSA is a logical choice.

I agree, if the birth will exceed the OOP max. I think that's why it'd be helpful for you to get an estimate of the costs for the upcoming birth, if possible.

Depending on how much the birth will cost, it may make more sense to go with the PPO Premium.

[megabad]

Just for clarity, the HSA plan as 20% coinsurance and the PPO has zero correct? This would mean to me that if the birth was low complication and low cost it would lean towards PPO and if it was high cost it would lean towards HSA. As others pointed out it would be useful to know you last birth cost as I have no idea what recent values would be. It looks like maybe 20 something thousand is your break even point but I didn’t run the math. If your last birth was 50k, the decision might be easy.

[Osterix]

Just for clarity, the HSA plan as 20% coinsurance and the PPO has zero correct? This would mean to me that if the birth was low complication and low cost it would lean towards PPO and if it was high cost it would lean towards HSA. As others pointed out it would be useful to know you last birth cost as I have no idea what recent values would be. It looks like maybe 20 something thousand is your break even point but I didn’t run the math. If your last birth was 50k, the decision might be easy.

My apologies. I had the formatting correct in a word document, and it got bamboozled when I posted!

20% co-insurance on the PPO Premium plan

0% co-insurance on the HDHP plan.

Equal individual and family OOP max for both plans.

[Spooky]

You should run the numbers for yourself--I did this the year I was pregnant, and the HDHP was always superior due to difference on premium expenses and the tax deduction from the HSA.

[DarkHelmetII]

I don’t like to make generalizations, but I would say that in a birth year I would probably go PPO in most cases. Especially when the coverage appears abnormally good for very little increase in premiums which seems like your case.

in many cases where I have run the numbers, HDHP wins on the outliers e.g. $0 spend (obvious) and completely blowing through out of pocket max - usually premium savings and tax benefit more than compensate, and often the max out of pocket is quite close. In a birth year I'd assume the 'extreme'. What is interesting is that the non HDHP wins in the middle somewhere like 1/3 to 2/3 of deductible or max out of pocket.

[ICMoney]

Young-ish mom of several kids here. Is your OB "global billing" for services? Mine always global billed except the one time I had Kaiser (i.e. charged all office visits and delivery services in one charge on the exact date of baby's birth).

When would the plan change effective date be - the exact date of birth, the first of the month after the birth, or something else? If it isn't effective on baby's exact birthdate, ignore my advice below.

If the plan change would be retroactive to baby's birthdate, then you may want to do the exact opposite of what you proposed. Start out the year in HDHP assuming your OB is global billing (you should only have to pay for labs prior to baby's birth which aren't global billed). Then make the plan change effective on the baby's birthdate to the PPO once baby is born. (I always had 30 days after the birth to make the plan change, and it would be retroactive to start baby's birthdate) If the plan change begins on baby's birthdate, it is means all hospital charges and OB global billing should run through the PPO benefit levels. Make sure the HDHP and PPO are through the same insurance company if possible, otherwise the global billing may get messed up. If the insurance company misprocesses the claims starting at baby's birthdate at the HDHP level, send them a secure message or call in to ask them reprocess at the PPO level once you know the plan change has happened in their system.

I have successfully done what I described above for multiple pregnancies/deliveries. It is important to know the answers to the two questions above though, in addition to knowing the same insurance company is offering both the HDHP and PPO, as they are critical in determining which choice to make.

Best, ICM

[AnEngineer]

Are you sure that you can switch midyear? I had thought that you could at my employer for the birth bring a qualifying event, but they later clarified that you can only switch levels of coverage on the same type of plan, that is just to add the kid.

[8foot7]

We owed $10,000+ for a singleton delivery on an HDHP and nothing in particular went wrong.
We owed $224 for delivery of twins on a PPO and several things went wrong with mom during delivery (luckily all fine now).
For us even the most favorable investment returns over 50 years in an HSA were dwarfed by the out of pocket savings.

[simplesimon]

We owed $10,000+ for a singleton delivery on an HDHP and nothing in particular went wrong.
We owed $224 for delivery of twins on a PPO and several things went wrong with mom during delivery (luckily all fine now).
For us even the most favorable investment returns over 50 years in an HSA were dwarfed by the out of pocket savings.

There's also the difference in premiums paid over the year in addition to the tax savings from HSA contributions, but wow $10k is a very high deductible/OOP Max.

[Galaxy8]

I'm investigating a similar situation right now - pregnant wife due next summer, I have both PPO and HDHP options.

My wife has access to a PPO family coverage with no premium and $350 deductible through her employer. I think enrolling her (and baby) in this for next year is a no-brainer.

I have access to the same PPO plan or an HDHP. If I utilize the HDHP, my OOP max is $5,000, but my employer contributes $3,400 to an HSA on my behalf. I have no expected health expenses (I used $0 health care dollars for 2019 and so far in 2020).

Can my wife use the (free) PPO coverage for herself and baby (family plan), and I obtain HDHP coverage (family plan) that would be my primary and my wife's secondary? Regarding baby's coverage, my wife is slightly older than I am, so the PPO would be baby's primary coverage based on the birthday rule. It feels like double dipping to me, but I can't see why it wouldn't work.

EDIT: After more reading, if I am covered secondarily under my wife's PPO, I'm not eligible to use an HSA? Therefore perhaps have my wife and baby covered under PPO, and just an individual HDHP for me?

[Nate79]

I'm investigating a similar situation right now - pregnant wife due next summer, I have both PPO and HDHP options.

My wife has access to a PPO family coverage with no premium and $350 deductible through her employer. I think enrolling her (and baby) in this for next year is a no-brainer.

I have access to the same PPO plan or an HDHP. If I utilize the HDHP, my OOP max is $5,000, but my employer contributes $3,400 to an HSA on my behalf. I have no expected health expenses (I used $0 health care dollars for 2019 and so far in 2020).

Can my wife use the (free) PPO coverage for herself and baby (family plan), and I obtain HDHP coverage (family plan) that would be my primary and my wife's secondary? Regarding baby's coverage, my wife is slightly older than I am, so the PPO would be baby's primary coverage based on the birthday rule. It feels like double dipping to me, but I can't see why it wouldn't work.

EDIT: After more reading, if I am covered secondarily under my wife's PPO, I'm not eligible to use an HSA? Therefore perhaps have my wife and baby covered under PPO, and just an individual HDHP for me?

If you have any other coverage, including coverage under the non-HDHP insurance or being an eligible member to be covered under your wife's FSA you would not be eligible to contribute to an HSA.

[mkc]

I would add in checking to see if changing mid-year resets your deductible. In the individual insurance market it does (if you switch plans mid year, none of your pre-switch personal contributions count towards the new plan's deductible), or at least that was our experience.

[humblecoder]

Just for clarity, the HSA plan as 20% coinsurance and the PPO has zero correct? This would mean to me that if the birth was low complication and low cost it would lean towards PPO and if it was high cost it would lean towards HSA. As others pointed out it would be useful to know you last birth cost as I have no idea what recent values would be. It looks like maybe 20 something thousand is your break even point but I didn’t run the math. If your last birth was 50k, the decision might be easy.

My apologies. I had the formatting correct in a word document, and it got bamboozled when I posted!

20% co-insurance on the PPO Premium plan

0% co-insurance on the HDHP plan.

Equal individual and family OOP max for both plans.

If the HDHP has 0% co-insurance after you meet the deductible, then your effective OOP max is your deductible, regardless of what the plan says. Unless I am missing something, why wouldn't you go with the HDHP?

[Osterix]

Just for clarity, the HSA plan as 20% coinsurance and the PPO has zero correct? This would mean to me that if the birth was low complication and low cost it would lean towards PPO and if it was high cost it would lean towards HSA. As others pointed out it would be useful to know you last birth cost as I have no idea what recent values would be. It looks like maybe 20 something thousand is your break even point but I didn’t run the math. If your last birth was 50k, the decision might be easy.

My apologies. I had the formatting correct in a word document, and it got bamboozled when I posted!

20% co-insurance on the PPO Premium plan

0% co-insurance on the HDHP plan.

Equal individual and family OOP max for both plans.

If the HDHP has 0% co-insurance after you meet the deductible, then your effective OOP max is your deductible, regardless of what the plan says. Unless I am missing something, why wouldn't you go with the HDHP?

That was my impression to regarding regarding the max OOP being the same as the deductible since their is 0% coinsurance. The Summary of Benefits is not available yet for review, but I plan to drill down further.

[28fe6]

I had 3 kids under HDHP. I deliberately chose the HDHP instead of the others available, even though I knew I was having a kid soon. I have no regrets. Your mileage will depend in your options. Just chiming in to say it's not crazy to do HDHP.

HDHP contributions is prorated by the number of whole months you were covered under the plan. It's a real hassle if accidentally over-contribute, so I would avoid doing that by accident.

[presto987]

Are you sure that you can switch midyear? I had thought that you could at my employer for the birth bring a qualifying event, but they later clarified that you can only switch levels of coverage on the same type of plan, that is just to add the kid.

This happened to me as well. I thought I would be able to switch the type of plan, but they didn't let me; I could only change who was covered.

[csmath]

I don’t like to make generalizations, but I would say that in a birth year I would probably go PPO in most cases. Especially when the coverage appears abnormally good for very little increase in premiums which seems like your case.

in many cases where I have run the numbers, HDHP wins on the outliers e.g. $0 spend (obvious) and completely blowing through out of pocket max - usually premium savings and tax benefit more than compensate, and often the max out of pocket is quite close. In a birth year I'd assume the 'extreme'. What is interesting is that the non HDHP wins in the middle somewhere like 1/3 to 2/3 of deductible or max out of pocket.

I found the same thing for my plans but the "band" where PPO was better was pretty thin. More importantly to me was the magnitude in which HDHP was better than the PPO. Even one decent year (low medical costs) with the HDHP was 4 times better than the best year for a PPO. This was with maxing the HSA for maximum tax benefit.