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Old 10-29-2008, 02:29 PM   #1
SereneOne
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PPO vs. HRA Plans?

We have Aetna PPO currently and have been happy with it, however DH's company is switching to BCBS the first of the year. I hope they are as good as Aetna has been.

We have a choice between another PPO or an HRA, which I have not heard of before. If I understand correctly, with an HRA, a thousand dollars goes into an account for medical expenses. Instead of paying a copay to see a doctor, we have to pay fully out of pocket until the deductible is met, which is 3000 for a family. We may use the thousand in the account toward these expenses, am I right so far? It does say that adult routine physicals are covered 100 percent, as are well child care visits and mammograms. Once deductibles are met, the insurance pays 90% of the bill.

I think this might work for my family. DH goes yearly for an exam and is in good shape. He never gets sick and has quit smoking. I do have some health issues, but I am working on them and getting healthier. I see the doctor twice a year for follow ups, see my obgyn once a year. I get my flu shot, etc. However, our daughter is special needs. She has VATER Association, an acronym for multiple birth defects and she also has Reactive Airway Disease. She sees seven specialists in addition to her peds. Now, she is doing FANTASTIC! She had reconstructive bowel surgery and heart surgery this summer and did well, everything else is just wait and see. She sees her specialists one or twice a year and everything is looking good. (She sees Shriners for her rib/vertabrae anomalies, peds cardio for her heart, peds nephro for her one good kidney (multicystic kidney), peds neuro was for her tethered spinal cord, peds pulmo for her RAD, peds endo keeps an eye on her to make sure her hypoparathyroidism does not come back, peds GI for her feeding tube, eating issues and bathroom issues, and she has had a peds surgeon for various issues).

Our insurance is her main insurance, because she recieves a small amount of SSI/Disability, she has Medicaid as her secondary, which covers the difference of her medical bills. Thank God, because we would not just be homeless, we would be without anything! Just her Pediasure and tubing would be several hundred a month.

Would the HRA be a good idea for our family? What had been your experiences with HRA and why or why not did you choose the plan you did?
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Old 10-29-2008, 02:59 PM   #2
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Funny you should ask. I was driving to pick up my DD on Saturday and Clark Howard was on the radio. A caller asked the same question. He told the caller to stick with the PPO because her DH has diabetes and the HRA will be eaten up pretty quickly with his supplies and meds.

Since your DD has secondary insurance, this may be a mute point for you. Because your circumstances are different than most people's, you should try to schedule a meeting with the BC/BS rep to work through what it will cost you under both scenarios. That's their job. They should be happy to sit down with you to discuss your options.
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Old 10-29-2008, 03:15 PM   #3
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The one thing to be aware of is that "after the deductable is met, the insurance covers 90%". If you have a major medical issue, that 10% can add up quickly. a $200,000 medical bill (which isn't uncommon) would cost you $20,000. A $1M medical issue would cost you $100,000.

Look at the BCBS policy closely before choosing, some of them can be quite good. Mine is excellent, they cover 100% of everything with hardly any out of pocket costs and I've never had any major issues with getting things approved and covered. My co-workers have reported the same, even those of them that had had six figure medical bills. They hardly paid a dime.
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Old 10-29-2008, 04:14 PM   #4
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Look at the BCBS policy closely before choosing, .
-----------------------

I have to agree with this.. Mine is absolutely horrible! Also, if something isn't specifically listed as "covered", be sure to ask a lot of questions because 9 times out of 10, it won't be covered..

Hope yours is a good one..
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Old 10-29-2008, 04:18 PM   #5
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I am now thinking it is not worth the savings of 40 plus dollars a paycheck to go with the HRA instead of the PPO. We have been happy with the PPO we have for about five years, so no since in fixing what is not broken.

I feel silly for not thinking of some of the points several of you brought up though, thanks for taking time to respond.
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Old 10-29-2008, 04:25 PM   #6
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Originally Posted by SereneOne View Post
I am now thinking it is not worth the savings of 40 plus dollars a paycheck to go with the HRA instead of the PPO. We have been happy with the PPO we have for about five years, so no since in fixing what is not broken.

I feel silly for not thinking of some of the points several of you brought up though, thanks for taking time to respond.
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Nothing to feel silly about! Most of us get our best info from the DIS..
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Old 10-29-2008, 04:27 PM   #7
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I deal with this question everyday a work but for a different company.

The way I advise it is to carefully figure out your out of pocket expenses.

if the PPO has a higher premium but pays better over the course of the plan (example 90/10 split of co-insurance cost) then the next thing you need to look is your lower premiums for the HRA account plan and then add in what your out of pocket expenses will be after that HRA is exhausted. Remember to include that co-insurance amount that will kick in after the deductible is met. If your PPO premiums are lower over the year than your out of pocket expenses with the HRA plan and your family tends to go to the doctor a lot..then you might be better off with the higher premium PPO.

I got clobbered this year because my daughter had unexpected back surgery. We switched to the HRA cause it was lower premiums and the girls hardly ever went for sick visits. I never thought they would tell me that DD #2 needed surgery,but they decided that after 2 years her disc was making no improvement and was getting worse so without surgery we were talking pain management for an 18 year old just to make her comfortable. we ended up exhausting the HRA in February, using all our FSA funds and still needed to pay over 3,000.00 outof pocket due to co-insurance. Of course she maxed her out of pocket so the rest of the yearshe has been covered at 100%, so all her PT has been covered in full, I keep telling her she has 2 more months to get sick, need drugs or any other medical treatment.

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Old 10-29-2008, 06:13 PM   #8
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Please look at your account again--the HRA is a health savings/reimbursment account, not a medical plan. It sounds like your company is putting $1000 into the account to help you cover deductibles for your new plan-which sounds like it is $3000. Is the plan perhaps a High Deductible plan where the company funds $1000 of your health savings account (HSA)--all these acronyms get confusing!!

What does the BC/BS plan say for coverages, deductibles, etc?

High Deductible plans can be great if your company funds all or part of your HSA but if you go to the doctor a lot they aren't the best plans. I would be concerned with the 90% after the deductible too--that can REALLY add up. If the other plan covers 100% after the deductible that is a better plan for you because you never know what your DD will need for further surgeries, etc.
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Old 10-29-2008, 07:15 PM   #9
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Quote:
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Please look at your account again--the HRA is a health savings/reimbursment account, not a medical plan. It sounds like your company is putting $1000 into the account to help you cover deductibles for your new plan-which sounds like it is $3000. Is the plan perhaps a High Deductible plan where the company funds $1000 of your health savings account (HSA)--all these acronyms get confusing!!

What does the BC/BS plan say for coverages, deductibles, etc?

High Deductible plans can be great if your company funds all or part of your HSA but if you go to the doctor a lot they aren't the best plans. I would be concerned with the 90% after the deductible too--that can REALLY add up. If the other plan covers 100% after the deductible that is a better plan for you because you never know what your DD will need for further surgeries, etc.
I agree with this. 10% can really add up.

We switched to a high deductible plan this past year but the company didn't put any money in the HSA for us!! We took 1/2 the difference we would be saving by the lower premiums into the HSA and we now have a $3k deductible. I did out the math with the HR Admin at DH's company and if we have major medical happen then once we meet the deductible and pay the premiums for 12 months it will be about a $2K savings a year between co-pays/rx/premiums and deductibles from the old plan. It works for us because we are building the HSA and have over $3K in emergency fund for a major medical expense. After we reach the $3K then everything is covered 100% and all routine exams before that are covered 100%.

I would probably stick with the PPO if you are talking a $80/month difference ... or $160?

When we switched I was paying $65 in rx co-pays per month which was going to go up to $85/month with the new PPO. The new high deductible plan had me paying $125/month out of pocket for the same rx on a cash basis but the premium was over $350 less a month. Our insurance runs April to end-March. So far we are about $850 into our $3k deductible but we have saved over $2600 in premiums.
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Old 10-29-2008, 07:21 PM   #10
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It could mean lower out of pocket costs if you stay healthy, but if something unexpected comes up watch out! That happened to me in 2005. I have always been very healthy and thought it was the perfect plan for me. Then I had to have an unexpected emergency surgery and ended up with $3000 out of pocket expenses instead of copays for the dr visits and hospital stay. Sure, it paid 90% after the deductible was met, but by that time it was too little too late.
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Old 10-29-2008, 07:41 PM   #11
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And HRA and HSA are two different things, so make sure you know which it will be. HRA is funded by the employer to help meet the out of pocket expenses of the medical plan.

HSA can have funds deposited by the employer and also by the employee. HRAwill roll over if not used but usually there is a limit on the dollar amount that rolls over. HSA rolls over everything never any restrictions because it is considered your money.

Then there is FSA which is fully funded by the employee, is not attached to the medical plan and is a use it or lose it plan.
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Old 10-29-2008, 07:42 PM   #12
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We have this type of plan, and it's because DH's company doesn't offer anything else. It's still a BCBS PPO, but with a $2,200 deductible. For the most part, they get it right administratively, and I'm not fighting things that should be covered, but that's the only thing good I can say about it. Most of dh's co-workers are unsatisfied with it, despite the HR spin that's put out about it. (Don't get your advice about what plan to pick from HR! )

I had a baby this year, and our out of pocket costs are already close to $4,000 because even after the deductible is met, many other things are only covered at 80 or 90 percent. The well baby visits are covered, though, and I'm paying nothing, where many people are paying $20 deductibles every time they visit.

ETA: WE have an HSA- Dh's company puts less than half in , and the rest comes out of dh's paychecks every week. The money is not available to use until it has actually hit the account, whereas with an FSA, all your money is available to you on Jan 1.
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Old 10-29-2008, 07:43 PM   #13
Nancy
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I agree with this. 10% can really add up.

We switched to a high deductible plan this past year but the company didn't put any money in the HSA for us!! We took 1/2 the difference we would be saving by the lower premiums into the HSA and we now have a $3k deductible. I did out the math with the HR Admin at DH's company and if we have major medical happen then once we meet the deductible and pay the premiums for 12 months it will be about a $2K savings a year between co-pays/rx/premiums and deductibles from the old plan. It works for us because we are building the HSA and have over $3K in emergency fund for a major medical expense. After we reach the $3K then everything is covered 100% and all routine exams before that are covered 100%.

I would probably stick with the PPO if you are talking a $80/month difference ... or $160?

When we switched I was paying $65 in rx co-pays per month which was going to go up to $85/month with the new PPO. The new high deductible plan had me paying $125/month out of pocket for the same rx on a cash basis but the premium was over $350 less a month. Our insurance runs April to end-March. So far we are about $850 into our $3k deductible but we have saved over $2600 in premiums.

sounds like you did it right, you did the math and figured out which worked best for you. that is how it should be done.

Don't look just at lower premiums, too many people get burned doing that.I'm amazed at the amount of people that really don't know what they signed up for.
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Old 10-29-2008, 07:45 PM   #14
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Also wanted to point out, that according the IRS, you are not allowed to have a high deductible savings account insurance with any other insurance. The literature that comes home from DH's work at open enrollment always specifies that you can NOT be double covered, so using this as a "back up" insurance isn't an option.
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Old 10-29-2008, 07:50 PM   #15
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yeah, I can't say about the HRA because I don't have it in front of me to study. And I can't speak to the BCBS in your area.

I just googled HRA and found this info...maybe it is helpful to you. I would sure study the plan you are offered carefully. http://www.tasconline.com/businessre...enter/hra.html

What I can speak to is my experience with BCBS. I am getting over a very nasty cancer. My bills are well over 200,000. My hospital visits are 30 to 40 grand a crack. I have had 6 so far, and one emergency visit. That doesn't even include the expense of dr's visits and clinic visits and medical supplies for me at the house. Frankly, I stopped counting after 200g's it may be upwards of 300 by now. I type this from my hospital bed on my 7th round of chemo.

And all I have to say about BCBS is ... they rock! Yes, I have co-pays, deductibles (I chose the lowest my plan would allow)...but I get to go anywhere I want for medical care no questions asked. I call anyway just to make sure they know and to make sure their statements are true... but I can self direct my medical care all day long. And as most of the world's top cancer centers are on BCBS's network... that means you aren't getting creamed with lower reimbursement rates. So, I have been amply impressed. Am I out a little money for out of pocket? Yeah, .....but for me? So what that I am out of pocket, I just got back from the #1 cancer center in the US and I am now being treated with their protocol at a hospital closer to home. How cool is that! On other plans, like a hmo or some other type of plan I would be locked into a network or limited in some way. For me the flexibility to go to whomever I choose is a very important option...always has been a very important feature for me even before getting sick.

They declined one bill...BCBS has a group they outsourced their medical imaging approvals to. This group said my pet scans were investigational so they declined to authorize or pay. We, my doctors and I, wrote BCBS's appeal department and the BCBS chief medical officer agreed that the outsourced approval department was way out of line...needless to say... they are now paying for all my pet scans.

Other then the one glitch ... I mean wow....200 to 300 thousand so far and I am not bankrupted or made destitute? Far out!

I would recommend BCBS to anyone based on my experience so far.
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