Health Savings Account rant

[edro]

My old employer had High Deductible Health Plan, so they had us set up Health Savings Accounts.
I have $2000 in there, but no longer work for that employer.
I just checked my account and they have been charging me a $3/mo service fee.
They charge $3/mo for balances under $5000!

Since my new employer has regular health insurance, it's not considered a HDHP, so I am not eligible to contribute to a Health Savings Account anymore.

So I am basically forced to use the money on medical expenses (I have none), let it sit and incur $3/mo fee, or withdraw it and take a 20% hit.

</firstworldproblems>

 

[ImpulsE69]

HSA's are a scam that were sold as a 'great' thing.

 

[TuxDave]

Yeah, I hit the same case many years ago. Hated it and didn't know what I could do besides spend it or watch it drain away to nothing.

 

[highland145]

I could send you some of my bills because of my HDHP. Think I've spent over $6K this year. Definitely not the norm and hope it doesn't become one.

 

[highland145]

HSA's are a scam that were sold as a 'great' thing.

Why?

 

[Fritzo]

$3 is standard below a certain balance.

 

[sourceninja]

You can open a new HSA at a new bank that does not charge fees. Then roll over your HSA. My last job used BMO and it had no fees.

 

[tynopik]

you can rollover to a better provider without paying the 20% fee. there's a big HSA thread on that wallet place with some that even pay interest

 

[Homerboy]

LOVE my FSA*!

*now with $500 roll over!

 

[ImpulsE69]

Why?

They save companies lots of money, but really are quite a step down to the employee from old policies. Sure they are better than nothing (if you spend a lot on healthcare) but to most people they are dependent on you simply not using your coverage.

The fact that they even charge a fee for keeping the savings is a scam in itself since you are already PAYING to have it. Fortunately where I work, they reimburse this fee, but I also fought against the fee because of this very reason.

 

[poofyhairguy]

I would go and get every checkup I needed for years.

 

[Dirigible]

I love my HDHP with HSA. So much cheaper than all the other options my employer offers.

 

[highland145]

They save companies lots of money, but really are quite a step down to the employee from old policies. Sure they are better than nothing (if you spend a lot on healthcare) but to most people they are dependent on you simply not using your coverage.

The fact that they even charge a fee for keeping the savings is a scam in itself since you are already PAYING to have it. Fortunately where I work, they reimburse this fee, but I also fought against the fee because of this very reason.

Self employed and I'm paying $559/mo for insurance now, $10K deductible. Going to $614 1/1/2015.

It's tax free and it rolls over if I don't use it...which hasn't been the case this year. I don't have a better option.

 

[FleshLight]

Roll it over to an account with no fees?

 

[edro]

Most providers have fees from what I can see, unless you have $5k.

I found one that doesn't appear to (Huntington), but I am still leery. It makes me less leery since they only offer it in Indiana, Kentucky, Michigan, Ohio, Pennsylvania and West Virginia.

I wonder how the IRS knows I am not currently in an HDHP? What if I find a provider and transfer my HSA to them for 0% fee, then start contributing to it?
How would the IRS know? If I deducted the contributions they would know, but if I contributed post-tax dollars...

 

[blinblue]

You should be able to find some HSA provider that has no fees, it probably won't have any decent investment options. But seeing as you only have $2000 to work with and can't add more, investing probably isn't worth it. Some quick googling returns a number of results of places that have HSAs without fees. One that jumps out and has some national brand name is BMO Harris (never used them, but from what I can tell, there would be no fees involved)

HSAs can be awesome. My work provides an excellent deal, for only marginally higher out of pocket costs vs their regular PPO, they have an HDHP and provide $1500/year to an HSA. In my situation, due to the lower premiums and the $1500 in "free" money, there was almost no situation in which the out of pocket costs would have made the non-HSA version worth it, and many scenarios in which I come out far ahead with the HSA.

Plus, I can contribute to my HSA with pre payroll and income tax dollars. So completely tax free going in, tax free investment growth, and if it is for medical uses, completely tax free coming out. So as long as the health plan makes sense financially relative to the other options out there, HSAs are fantastic.

 

[Exterous]

I don't know what, if any fees Vanguard charges but I will be looking into them for a possible yearly roll over option towards the end of December. They are well known to have very low fees for more traditional investments so I would think the same would apply to HSAs but I do not know that for sure yet

https://personal.vanguard.com/us/whatweoffer/overview/healthsavingsindividuals

 

[edro]

I checked Vanguard. They don't offer HSAs, but recommend a place that does and has Vanguard investment funds.

 

[alkemyst]

HSA's are a scam that were sold as a 'great' thing.

No they are not, especially when you can also do child care through them.

It's all tax-free so for me that's like a 20-30% savings.

You just don't want to put in more than you use, if you have a 'flexible spending account'. IMHO HSA is much better.

I have certain prescriptions and medical things like co-pays that I know I will have every year. I keep putting more money in each year as I find other things I can use it on.

I need to look into HSA, my company does not offer one, but our deductible is $4500.

 

[edro]

You just don't want to put in more than you use.

Why? You never lose them.
HSAs are not FSAs (use or lose).

 

[PenguinPower]

No they are not, especially when you can also do child care through them.

It's all tax-free so for me that's like a 20-30% savings.

You just don't want to put in more than you use.

I have certain prescriptions and medical things like co-pays that I know I will have every year. I keep putting more money in each year as I find other things I can use it on.

Yeah...you're thinking FSA, not HSA.

 

[xeemzor]

The difference between my HDHP and a traditional PPO plan is $400/month AND they give me $1000/year free. If you are young, single, and healthy it's the obvious choice. You can even use it as a better retirement vehicle than an IRA/401k since you will find a tax free use for it at some point.

 

[alkemyst]

Yeah...you're thinking FSA, not HSA.

I edited my post to clarify.

 

[alkemyst]

The difference between my HDHP and a traditional PPO plan is $400/month AND they give me $1000/year free. If you are young, single, and healthy it's the obvious choice. You can even use it as a better retirement vehicle than an IRA/401k since you will find a tax free use for it at some point.

Our difference is a net of $500 year end. Better to gamble on the HDHP than the traditional unless you know you have $4000+ of medical care in a year.

 

[BoberFett]

LOVE my FSA*!

*now with $500 roll over!

FSA and HSA are very different.

Edit: I see this has been addressed.