HDHP over BCBS Basic for Feds?

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tj
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Re: HDHP over BCBS Basic for Feds?

Post by tj »

RJC wrote: Sat Nov 16, 2019 9:36 pm
grabiner wrote: Thu Nov 14, 2019 10:09 pm
stan1 wrote: Thu Nov 14, 2019 8:17 pm Also remember non-HDHP plans can be paired with an FSA up to $2700 exempt from federal and state income tax. So $900 savings if you are married in 33% tax bracket.
And HDHP holders can use a limited-expense HSA for dental and vision coverage, so you can still get some of that benefit if you buy glasses or contacts, or know you will have dental work. (Many HDHPs cover dental checkups and cleanings, so you may not need an FSA for that part of your expenses; likewise, if you have partial vision care, reduce your FSA contribution accordingly.)
I thought GEHA HDHP has full vision coverage?
You have a $5 co pay on exmas, but the EyeMed insurance certainly doesn't cover 100% of high-end glasses frames and progressive lens.
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grabiner
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Re: HDHP over BCBS Basic for Feds?

Post by grabiner »

RJC wrote: Sat Nov 16, 2019 9:36 pm
grabiner wrote: Thu Nov 14, 2019 10:09 pm
stan1 wrote: Thu Nov 14, 2019 8:17 pm Also remember non-HDHP plans can be paired with an FSA up to $2700 exempt from federal and state income tax. So $900 savings if you are married in 33% tax bracket.
And HDHP holders can use a limited-expense HSA for dental and vision coverage, so you can still get some of that benefit if you buy glasses or contacts, or know you will have dental work. (Many HDHPs cover dental checkups and cleanings, so you may not need an FSA for that part of your expenses; likewise, if you have partial vision care, reduce your FSA contribution accordingly.)
I thought GEHA HDHP has full vision coverage?
Checking the GEHA HDHP Brochure, it provides an eye exam for a $5 co-payment ($55 for contact lens exams), frames every two years up to $100 for free but you pay 80% of the difference; lenses for $10 but you pay extra for premium options; and contacts for $10 plus 85% of any excess over $110. Thus, if you buy expensive contacts, or any but the cheapest frames, or multiple pairs of glasses, or additional glasses features such as high-index or anti-reflective coating, you may pay a significant amount out of pocket.
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GiannaLuna
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Re: HDHP over BCBS Basic for Feds?

Post by GiannaLuna »

They will deposit $150/month to your HSA.

Is each agency different in this regard? I ask because my agency puts in less than half that amount for me each month.
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RJC
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Re: HDHP over BCBS Basic for Feds?

Post by RJC »

GiannaLuna wrote: Sun Nov 17, 2019 6:33 am They will deposit $150/month to your HSA.

Is each agency different in this regard? I ask because my agency puts in less than half that amount for me each month.
Perhaps it depends on your location as well?

https://www.opm.gov/healthcare-insuranc ... are-plans/
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Re: HDHP over BCBS Basic for Feds?

Post by GiannaLuna »

I am in downtown DC.

The calculator (as far as I can tell) appears to show me my cost, but not my agency contributions.
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Re: HDHP over BCBS Basic for Feds?

Post by RJC »

GiannaLuna wrote: Sun Nov 17, 2019 6:39 am I am in downtown DC.

The calculator (as far as I can tell) appears to show me my cost, but not my agency contributions.
Oh, I think 150 a month is for family.
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Re: HDHP over BCBS Basic for Feds?

Post by tj »

GiannaLuna wrote: Sun Nov 17, 2019 6:33 am They will deposit $150/month to your HSA.

Is each agency different in this regard? I ask because my agency puts in less than half that amount for me each month.


Single gets $75/mo. The other options get 150/mo.
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Re: HDHP over BCBS Basic for Feds?

Post by tj »

grabiner wrote: Sat Nov 16, 2019 11:43 pm
RJC wrote: Sat Nov 16, 2019 9:36 pm
grabiner wrote: Thu Nov 14, 2019 10:09 pm
stan1 wrote: Thu Nov 14, 2019 8:17 pm Also remember non-HDHP plans can be paired with an FSA up to $2700 exempt from federal and state income tax. So $900 savings if you are married in 33% tax bracket.
And HDHP holders can use a limited-expense HSA for dental and vision coverage, so you can still get some of that benefit if you buy glasses or contacts, or know you will have dental work. (Many HDHPs cover dental checkups and cleanings, so you may not need an FSA for that part of your expenses; likewise, if you have partial vision care, reduce your FSA contribution accordingly.)
I thought GEHA HDHP has full vision coverage?
Checking the GEHA HDHP Brochure, it provides an eye exam for a $5 co-payment ($55 for contact lens exams), frames every two years up to $100 for free but you pay 80% of the difference; lenses for $10 but you pay extra for premium options; and contacts for $10 plus 85% of any excess over $110. Thus, if you buy expensive contacts, or any but the cheapest frames, or multiple pairs of glasses, or additional glasses features such as high-index or anti-reflective coating, you may pay a significant amount out of pocket.
And you have to use the network to get the best reimbursement, but glasses can be significantly cheaper from internet outlets.
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Re: HDHP over BCBS Basic for Feds?

Post by benskisuda »

Tdubs wrote: Mon Nov 11, 2019 1:59 pm Yes, HDHP will benefit you, especially if you maximize contributions to the HSA.

The favorite HDHP seems to be GEHA. Checkbook's analysis for 2020 plan indicates that GEHA is a better buy than the other FEHB HDHPs regardless of high or low spend years.
Any idea where United HDHP ranks on the Checkbook 2020 analysis?
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Re: HDHP over BCBS Basic for Feds?

Post by RJC »

HawkeyeJD wrote: Thu Nov 14, 2019 11:50 pm
stan1 wrote: Thu Nov 14, 2019 8:17 pm
RJC wrote: Thu Nov 14, 2019 9:49 am
Do you have any concerns about the Rx coverage? I'm used to a flat $10 copay vs 25%. Is 25% good? Not sure how much generic drugs cost these days.
Many of the FEHB plans now have prescription cost calculators so you can put in what you use.

Prescription drug coverage for non-generic drugs has become a major cost differentiator between different FEHB plans. If you need a non-generic drug you need to be very careful. Some drug classes do not have a generic option. If you don't need a non-generic drug now you can manage your risk by being able to switch to a different plan next year that has a fixed co-pay for non-generic drugs rather than a co-insurance payment. BCBS Standard is one of the more expensive plans but it may still be a good choice for anyone who needs non-generic prescriptions because it has a low co pay for a 90 day mail order supply (have to run the numbers for your situation).

Also remember non-HDHP plans can be paired with an FSA up to $2700 exempt from federal and state income tax. So $900 savings if you are married in 33% tax bracket.

I can highlight in my situation why the HDHP plan was a substantially worse choice and it relates to one of Stan1’s points:

My monthly prescription costs $2000. Under BCBS Basic my cost is a $70 copay. I then use the drug companies copay program, which reduces the copay to $5 a month.

Under Geha HDHP, the drug is also $2000 a month but I’m on the hook for $500 a month (25% preferred specialty copay). The drug company program actually covers up to $10k a year in copay assistance. However, on page 88 of the 2020 geha HDHP brochure, it says “Drug coupon/copay cards: We do not honor or coordinate benefits with drug coupon/copay cards. You are responsible for your copay or coinsurance as indicated in this brochure.” Based on this language I’d be unable to use the copay program and I’d hit the HDHP individual catastrophic cap of $5k in the early to middle of each year.

Note that BCBS Basic brochure has no stated restrictions about copay card coordination.

Running the scenario based on the above appears to be a clear win for BSBC Basic in my scenario as the higher premiums relative to geha HDHP are more than offset by the much lower costs for my particular medication.
Thank you for your comment. It does appear that there are a few situations where Basic may come up on top; but overall, it does seem like a HDHP might be a good fit for us.
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Re: HDHP over BCBS Basic for Feds?

Post by Tdubs »

benskisuda wrote: Sun Nov 17, 2019 10:11 am
Tdubs wrote: Mon Nov 11, 2019 1:59 pm Yes, HDHP will benefit you, especially if you maximize contributions to the HSA.

The favorite HDHP seems to be GEHA. Checkbook's analysis for 2020 plan indicates that GEHA is a better buy than the other FEHB HDHPs regardless of high or low spend years.
Any idea where United HDHP ranks on the Checkbook 2020 analysis?
Here is the Checkbook analysis for the most cost effective plans in my area (Frederick, MD) with low, average and high spending years. These are the numbers for a family of four plan.

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tj
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Re: HDHP over BCBS Basic for Feds?

Post by tj »

benskisuda wrote: Sun Nov 17, 2019 10:11 am
Tdubs wrote: Mon Nov 11, 2019 1:59 pm Yes, HDHP will benefit you, especially if you maximize contributions to the HSA.

The favorite HDHP seems to be GEHA. Checkbook's analysis for 2020 plan indicates that GEHA is a better buy than the other FEHB HDHPs regardless of high or low spend years.
Any idea where United HDHP ranks on the Checkbook 2020 analysis?
The problem with UHC is that it's not a fee for service PPO, it's something else, I don't recall what. Regardless of what it is, you pay drastically more if you go out of network with UHC's plan. It's a 30% coinsurance instead of the low co-pays that are in network. And that's 30% coinsurance on the negotiated price which is always lower than what an out of network provider will charge. With the GEHA HDHP PPO, you will pay more out of network, but not like with UHC, you get the same cheap 5% coinsurance rate in and out of network.

Correction: GEHA's out of network coinsurance rate is 25%
Last edited by tj on Sun Nov 17, 2019 5:48 pm, edited 1 time in total.
tomwood
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Re: HDHP over BCBS Basic for Feds?

Post by tomwood »

Tdubs wrote: Mon Nov 11, 2019 1:59 pm Yes, HDHP will benefit you, especially if you maximize contributions to the HSA.

The favorite HDHP seems to be GEHA. Checkbook's analysis for 2020 plan indicates that GEHA is a better buy than the other FEHB HDHPs regardless of high or low spend years.
I’m not familiar with checkbook but how do they rate MHBP (through National Postal Mail Handlers Union - but you don’t need to be a mail handler)? It’s also a HDHP like GEHA with near identical premiums but MHBP contributes more to the HSA for you ($2,400 total).

If you’d be able to share how checkbook rates these against each other I’d be thankful.
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Re: HDHP over BCBS Basic for Feds?

Post by tomwood »

motorcyclesarecool wrote: Mon Nov 11, 2019 8:13 pm
What s/he said. You’ll still get $1800, but the last $150 premium pass-through won’t arrive in your account until January 2021. But it still counts as a contribution for 2020. Don’t accidentally over contribute.
[/quote]

With this eventually correct itself with $300 being contributed in Jan 2021 ($150 also for the year 2021)?
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Re: HDHP over BCBS Basic for Feds?

Post by tomwood »

VictoriaF wrote: Tue Nov 12, 2019 10:52 am I am in the DC area and trying to choose between BC/BS-Basic and BC/BS-Standard. Another option is GEHA-High.

How likely is one to need an out-of-network doctor that's not covered by BC/BS-Basic? All my current doctors are in the network, but I am thinking about unknown unknowns.

Victoria
I don’t know the DC area but BC/BS is a huge health insurance company across the nation. I’d suspect they have many doctors in many cities. You’d need to check on specific doctors, such as your family doctor, who you know you’ll be visiting, but if your primary sends you to a specialist, they likely know of a few different specialists and I think it’s safe to say at least one will take BCBS. I will say again that I don’t know your area but BCBS is one of the biggest national players. Is MHBP an option in your area?
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Re: HDHP over BCBS Basic for Feds?

Post by tomwood »

AnonJohn wrote: Thu Nov 14, 2019 7:04 am
For those long-term investors with GEHA, the HSA bank / TD Ameritrade approach is free (fees paid). The only "cost" is having to leave $100 in HSA bank. I recommend it. Nowadays you can seemingly do Vanguard ETFs free @ TD ameritrade, but I haven't moved from the SPDRs, which have lower ERs (that's another project!)
If I’ve never used a plan before, how can I learn who the initial custodian of my HSA Account will be?
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Re: HDHP over BCBS Basic for Feds?

Post by Tdubs »

tomwood wrote: Sun Nov 17, 2019 3:31 pm
Tdubs wrote: Mon Nov 11, 2019 1:59 pm Yes, HDHP will benefit you, especially if you maximize contributions to the HSA.

The favorite HDHP seems to be GEHA. Checkbook's analysis for 2020 plan indicates that GEHA is a better buy than the other FEHB HDHPs regardless of high or low spend years.
I’m not familiar with checkbook but how do they rate MHBP (through National Postal Mail Handlers Union - but you don’t need to be a mail handler)? It’s also a HDHP like GEHA with near identical premiums but MHBP contributes more to the HSA for you ($2,400 total).

If you’d be able to share how checkbook rates these against each other I’d be thankful.
One of my co-workers (not a postal worker) signed up for MHBP. So it is possible for non-postal workers to join, but I believe non-postal workers have some added premium or membership fee. You can see that MHBP actually has the advantage over GEHA if you make no use of medical services (reflecting the larger pass through contribution of $2,400), but GEHA has the advantage after that. Because my family makes ample use of GEHA, I ruled out MHBP as an option.

Regarding the way Checkbook compares plans. I'd have to go back and look at specifics, but they create scenarios of medical usage for the low, average, and high scenarios. For example, I recall the high spending scenario included a hospital stay and at least $30-40k in usage. Low was a few office visits and labs. So, it gives you a good idea that one plan may be better most of the time, but there are cases where another plan might be superior in ways that are not picked up by Checkbook. For example, much ink has been spilled on BH about GEHA HDHP vs. GEHA standard plan. The standard plan coupled with an FSA can be competitive in certain cases (ER visit due to accident) and when your spending is right around the $3k deductible. But most of the time, the HDHP will be better. Best to consider your own usage carefully before picking a plan.
Last edited by Tdubs on Sun Nov 17, 2019 6:16 pm, edited 1 time in total.
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Re: HDHP over BCBS Basic for Feds?

Post by Tdubs »

tomwood wrote: Sun Nov 17, 2019 3:45 pm
AnonJohn wrote: Thu Nov 14, 2019 7:04 am
For those long-term investors with GEHA, the HSA bank / TD Ameritrade approach is free (fees paid). The only "cost" is having to leave $100 in HSA bank. I recommend it. Nowadays you can seemingly do Vanguard ETFs free @ TD ameritrade, but I haven't moved from the SPDRs, which have lower ERs (that's another project!)
If I’ve never used a plan before, how can I learn who the initial custodian of my HSA Account will be?
For GEHA HDHP, it is in the brochure (p. 33). I'd assume that is the case for the others.
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Re: HDHP over BCBS Basic for Feds?

Post by motorcyclesarecool »

tomwood wrote: Sun Nov 17, 2019 3:34 pm
motorcyclesarecool wrote: Mon Nov 11, 2019 8:13 pmWhat s/he said. You’ll still get $1800, but the last $150 premium pass-through won’t arrive in your account until January 2021. But it still counts as a contribution for 2020. Don’t accidentally over contribute.
With this eventually correct itself with $300 being contributed in Jan 2021 ($150 also for the year 2021)?
No. $150 per month will always arrive in your account the month AFTER. It never catches up. It kind of makes sense, as it’s a partial return of premium, and it stands to reason that GEHA wouldn’t want to be in the position of advancing the pass-through ahead of the premium on which it is based being paid.
Understand that choosing an HDHP is very much a "red pill" approach. Most would rather pay higher premiums for a $20 copay per visit. They will think you weird for choosing an HSA.
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Re: HDHP over BCBS Basic for Feds?

Post by RJC »

I just ran my information on CheckBook - GEHA HDHP is #1 and BCBS Basic is about halfway down the list for Avg. Yearly Cost Estimate. I'm sold.
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Re: HDHP over BCBS Basic for Feds?

Post by UALflyer »

RJC wrote: Mon Nov 18, 2019 7:22 am I just ran my information on CheckBook - GEHA HDHP is #1 and BCBS Basic is about halfway down the list for Avg. Yearly Cost Estimate. I'm sold.
I would encourage you to be extraordinarily careful in basing your decisions on Checkbook's figures. If you have no other information about your potential usage, it is a fine starting point, but most people know what their prior healthcare usage has been, in which case running your own numbers, understanding the details of each plan, and picking a plan based on those can save you thousands of dollars each year.

As I've previously posted, what Checkbook's figures won't tell you, for instance, is that with GEHA's non-HDHP, if you use the LabCard benefit, all your labs are covered at 100% without any copayments or deductibles. It's not that Checkbook's numbers are incorrect. It is just that Checkbook has no way of knowing whether you would be using the LabCard benefit or letting the providers use outside labs (in which case you'd be subject to the deductible), so you have no idea what assumptions are being used. There are lots and lots of examples like that.

It may very well be that based on your particular figures, an HDHP would make the most sense. My concern here is that you are being steered towards it by a couple of posters who don't have a thorough understanding of all the considerations that go into these types of decisions and obviously don't know anything about your particular situation. They have simply concluded that an HDHP makes the most sense in their situations, and, based on that and on Checkbook's figures, are indiscriminately pushing people towards HDHP's, all without realizing just how costly their advice would end up being for a ton of people out there.
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Re: HDHP over BCBS Basic for Feds?

Post by AnonJohn »

RJC wrote: Thu Nov 14, 2019 7:22 am
AnonJohn wrote: Thu Nov 14, 2019 7:04 am @OP & MillenialFinance: After a long time with BCBS basic and in between the birth of my two kids, I switched to GEHA HDHP. We've been happy ever since, including in the birth year. We live in DC. Regret not doing it earlier.

OP, I think you have it right --- ignore the deductible since it's "gift" money (in the form of HSA pass through and reduced premiums). That said, the earlier warning not to avoid care to save money is a key psychological point.

Other bits: the Carefirst HDHP was suggested. In my view it's a competitive offering, but I've stuck with GEHA since it's close and I can't see how to break the tie and I'm happy with GEHA. GEHA does offer some preventative dental and some in-network dental pricing, which is nice.

For those long-term investors with GEHA, the HSA bank / TD Ameritrade approach is free (fees paid). The only "cost" is having to leave $100 in HSA bank. I recommend it. Nowadays you can seemingly do Vanguard ETFs free @ TD ameritrade, but I haven't moved from the SPDRs, which have lower ERs (that's another project!)

I have my voluntary HSA contributions deducted through payroll, saving medicare tax. I prefer this to using fidelity / doing it myself, but it maybe depends on your agency.

I'd caveat all this with: (a) there are a lot of good choices in FEHB; lucky to have them and (b) fully funding the HSA with a middling to high marginal rate is a factor. In the 15% bracket you should run the numbers, but GEHA probably still looks good.

Hope this helps ...
Thank you AnonJohn. What do you mean by "(b) fully funding the HSA with a middling to high marginal rate is a factor. In the 15% bracket you should run the numbers, but GEHA probably still looks good."? Does it matter what tax bracket you are in to get the most benefit?

Also, have you used GEHA-HDHP's vision benefit? Can I take out my current vision plan?
Hi RJC - Sorry for the tardy reply and initial poor writing. What I mean is that making the HSA/HDHP approach a winner is easiest when (1) You have a high tax rate (you save X% of the ~$7k on taxes) and (2) You take full advantage of the HSA (~$7k). If you are in a very low tax bracket, or if you can't save the full amount, the immediate savings on taxes are smaller and other plans may be more competitive.

Re: vision - sorry, can't help. Haven't done that.

Cheers

JOhn
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Re: HDHP over BCBS Basic for Feds?

Post by AnonJohn »

tomwood wrote: Sun Nov 17, 2019 3:45 pm
AnonJohn wrote: Thu Nov 14, 2019 7:04 am
For those long-term investors with GEHA, the HSA bank / TD Ameritrade approach is free (fees paid). The only "cost" is having to leave $100 in HSA bank. I recommend it. Nowadays you can seemingly do Vanguard ETFs free @ TD ameritrade, but I haven't moved from the SPDRs, which have lower ERs (that's another project!)
If I’ve never used a plan before, how can I learn who the initial custodian of my HSA Account will be?
If you're using GEHA it will be HSA Bank, a division of Webster Bank. That's where the GEHA pass through goes. I think you can set up your payroll deduction to go to any bank of your choosing. You would need to set it up to have the routing number. I saw no reason not to use HSA bank for all of it.
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Re: HDHP over BCBS Basic for Feds?

Post by GiannaLuna »

Good to hear! So the gov't puts in $1,800 into your HSA account each year? How does that work?

I was recently informed, FWIW, that the $1800 is deposited by the insurer, not the govt employer.
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Re: HDHP over BCBS Basic for Feds?

Post by tj »

GiannaLuna wrote: Tue Dec 03, 2019 5:27 am Good to hear! So the gov't puts in $1,800 into your HSA account each year? How does that work?

I was recently informed, FWIW, that the $1800 is deposited by the insurer, not the govt employer.

That's correct.
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Re: HDHP over BCBS Basic for Feds?

Post by grabiner »

GiannaLuna wrote: Tue Dec 03, 2019 5:27 am Good to hear! So the gov't puts in $1,800 into your HSA account each year? How does that work?

I was recently informed, FWIW, that the $1800 is deposited by the insurer, not the govt employer.
You notify your insurer of the account number for your HSA, and it will deposit $150 every month. If you don't notify your insurer that you have an HSA for contributions (for example, if other coverage makes you ineligible), the insurer will instead put $1800 for the year into a Health Reimbursement Agreement, which covers your medical costs but does not earn interest and is lost if you leave the plan.

Since the government doesn't know whether the insurer made the HSA contribution or not, the contribution will not be reported on your W-2, but you still need to report it as an employer contribution on your tax forms.
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Re: HDHP over BCBS Basic for Feds?

Post by tj »

grabiner wrote: Tue Dec 03, 2019 9:45 pm
GiannaLuna wrote: Tue Dec 03, 2019 5:27 am Good to hear! So the gov't puts in $1,800 into your HSA account each year? How does that work?

I was recently informed, FWIW, that the $1800 is deposited by the insurer, not the govt employer.
You notify your insurer of the account number for your HSA, and it will deposit $150 every month. If you don't notify your insurer that you have an HSA for contributions (for example, if other coverage makes you ineligible), the insurer will instead put $1800 for the year into a Health Reimbursement Agreement, which covers your medical costs but does not earn interest and is lost if you leave the plan.

Since the government doesn't know whether the insurer made the HSA contribution or not, the contribution will not be reported on your W-2, but you still need to report it as an employer contribution on your tax forms.
What line does it go on?
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Re: HDHP over BCBS Basic for Feds?

Post by grabiner »

tj wrote: Wed Dec 04, 2019 7:12 am
grabiner wrote: Tue Dec 03, 2019 9:45 pm
GiannaLuna wrote: Tue Dec 03, 2019 5:27 am Good to hear! So the gov't puts in $1,800 into your HSA account each year? How does that work?

I was recently informed, FWIW, that the $1800 is deposited by the insurer, not the govt employer.
You notify your insurer of the account number for your HSA, and it will deposit $150 every month. If you don't notify your insurer that you have an HSA for contributions (for example, if other coverage makes you ineligible), the insurer will instead put $1800 for the year into a Health Reimbursement Agreement, which covers your medical costs but does not earn interest and is lost if you leave the plan.

Since the government doesn't know whether the insurer made the HSA contribution or not, the contribution will not be reported on your W-2, but you still need to report it as an employer contribution on your tax forms.
What line does it go on?
Form 8889, Health Savings Accounts (HSAs), line 9 for employer contributions. Your own deductible contribution (line 2) plus employer contributions which were never taxed (line 9) may be no more than the IRS contribution limit.
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Re: HDHP over BCBS Basic for Feds?

Post by tj »

So the insurer portion is considered an employer portion on the form?

Good to know.

My first year filing with the GEHA hdhp. Also my first year as a fed.
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