HSA, taxes, etc

[disneymagicgirl]

I need to know the best way to do this...or if the way I think is actually the best way. :surf web:

DH had emergency surgery and racked up about $10k in bills since the surgeon was out of network. That was beyond our control when his finger was hanging off, but I digress. I am done arguing with scumbag insurance companies, for my own sanity.

I paid a $2300 anesthesia bill on a 0% credit card about 2 mths ago. I want to pay it off now. Our HSA is empty since I paid other medical bills with it.
Is my best option to now transfer $2300 from personal checking into my HSA (so I can put that on our tax return for this year), then withdraw it to refund myself for paying the medical expense OOP, and then pay the CC bill with it?

I don't want to miss out on the opportunity to get the tax benefit of the money having gone through my HSA. **This would NOT put us above the max HSA contribution for the year, btw.**

 

[*Flower*]

Is the HSA fund different from the FSA fund? I know that FSA funds are deducted from pay prior to taxes being taken out.

 

[disneymagicgirl]

Is the HSA fund different from the FSA fund? I know that FSA funds are deducted from pay prior to taxes being taken out.

Yes it is different. We have some deducted from paycheck and sent to it but we can also transfer money into it ourselves...up to a total contribution of $6550 for 2014

 

[Shelly F - Ohio]

Yes the option you mentioned in your first post is the best way to do it. I have an HSA and did a similar thing. Yes you don't want to miss the tax advantage so transfer it into the HSA acct then write a check to pay yourself. Just keep a paper trail about all of this in case you need it someday to prove why you had to pay yourself back.

 

[disneymagicgirl]

Yes the option you mentioned in your first post is the best way to do it. I have an HSA and did a similar thing. Yes you don't want to miss the tax advantage so transfer it into the HSA acct then write a check to pay yourself. Just keep a paper trail about all of this in case you need it someday to prove why you had to pay yourself back.

Ok, great, thanks! Just wanted to make sure I wasn't missing anything.

 

[lanejudy]

Do you already have planned to contribute the max $6550 for this year through payroll deduction? If so, you'll actually mess that up if you deposit $2300 from your checking account. It's my understanding that as long as you maintain a clear paper trail, you can pay the $2300 bill from your private checking account, then reimburse yourself from the HSA as funds are deposited -- no need to put your money into the HSA first.

We maxed out our OOP early this year and I'm still working on getting a payment plan in place to pay as my payroll deductions roll in, so I completely understand where you are at the moment. Sorry to hear of DH's surgery; hope he's recovering well!

 

[disneymagicgirl]

Do you already have planned to contribute the max $6550 for this year through payroll deduction? If so, you'll actually mess that up if you deposit $2300 from your checking account. It's my understanding that as long as you maintain a clear paper trail, you can pay the $2300 bill from your private checking account, then reimburse yourself from the HSA as funds are deposited -- no need to put your money into the HSA first.

We maxed out our OOP early this year and I'm still working on getting a payment plan in place to pay as my payroll deductions roll in, so I completely understand where you are at the moment. Sorry to hear of DH's surgery; hope he's recovering well!

No, we only put $200/mth in thru payroll deposit, so I am ok to deposit the extra.

DH is doing well with physical therapy. He did also tear his meniscus now tho and has surgery for that on Wednesday. the only good thing about this 2nd injury is that we met our max OOP from the hand surgery so this one is free .

 

[melliej]

We deposit money tax free into our HSA account, but pay medical/dental expenses using our credit card and earn SPG points for vacations. I then submit the claim through the HSA account for reimbursement. All paperwork is kept for tax purposes.

 

[bumbershoot]

DH had emergency surgery and racked up about $10k in bills since the surgeon was out of network. That was beyond our control when his finger was hanging off, but I digress. I am done arguing with scumbag insurance companies, for my own sanity.

Despite it being coded as an emergency, the insurance company is still acting like it was your choice? And/or you are 100% sure that the surgeon's billing people coded it correctly?

(a surgeon I had to deal with, and had no choice about, coded it wrong and REFUSED to code it correctly, so I got to do the same thing in a different situation, and it is so so so so rotten. and I talk badly about him, with his name, in my local area every chance I get, along with the hospital he was at, so I hope have cost him AT LEAST that much in the last 10 years...)

 

[disneymagicgirl]

We deposit money tax free into our HSA account, but pay medical/dental expenses using our credit card and earn SPG points for vacations. I then submit the claim through the HSA account for reimbursement. All paperwork is kept for tax purposes.

Great idea! I will start that!

 

[disneymagicgirl]

Despite it being coded as an emergency, the insurance company is still acting like it was your choice? And/or you are 100% sure that the surgeon's billing people coded it correctly?

(a surgeon I had to deal with, and had no choice about, coded it wrong and REFUSED to code it correctly, so I got to do the same thing in a different situation, and it is so so so so rotten. and I talk badly about him, with his name, in my local area every chance I get, along with the hospital he was at, so I hope have cost him AT LEAST that much in the last 10 years...)

I was finally able to get them to "cover" the $12k surgeon bill as "in network" after much work proving it was emergent. However, they only pay their allowable, that they would have paid an in network doc, which was $3k. We got stuck with the other $9k. On top of that, the $9k we have to pay doesn't even apply to our out of network max OOP (which is $6k) b/c it is above allowable.

Our max Indiv OOP for in network is $3k, so we have to pay that too...toward anesthesia, hospital charges, etc. We went to an in network facility and just got unlucky that the surgeon they called in on a Saturday night was not in network.

So all in we are out $12k for this. We always thought worse case for a year would be $6k (family max OOP in network). I didn't realize the insurance companies are legally able to be the most crooked companies on earth. Don't get me started...

 

[SuzanneSLO]

We deposit money tax free into our HSA account, but pay medical/dental expenses using our credit card and earn SPG points for vacations. I then submit the claim through the HSA account for reimbursement. All paperwork is kept for tax purposes.

I do the same, except I'm still waiting to reimburse myself. My HSA account pays 2%, much better than my other accounts. Of course, after more than 5 years, I have a LOT of paperwork to save. -- Suzanne

 

[bumbershoot]

I was finally able to get them to "cover" the $12k surgeon bill as "in network" after much work proving it was emergent. However, they only pay their allowable, that they would have paid an in network doc, which was $3k. We got stuck with the other $9k. On top of that, the $9k we have to pay doesn't even apply to our out of network max OOP (which is $6k) b/c it is above allowable.

Our max Indiv OOP for in network is $3k, so we have to pay that too...toward anesthesia, hospital charges, etc. We went to an in network facility and just got unlucky that the surgeon they called in on a Saturday night was not in network.

So all in we are out $12k for this. We always thought worse case for a year would be $6k (family max OOP in network). I didn't realize the insurance companies are legally able to be the most crooked companies on earth. Don't get me started...

Rotten.

Hadn't thought about the surgeon not writing off the excess like an in-network who had an arrangement with the insurance company would have to do.

 

[yanilat]

I was finally able to get them to "cover" the $12k surgeon bill as "in network" after much work proving it was emergent. However, they only pay their allowable, that they would have paid an in network doc, which was $3k. We got stuck with the other $9k. On top of that, the $9k we have to pay doesn't even apply to our out of network max OOP (which is $6k) b/c it is above allowable.

Our max Indiv OOP for in network is $3k, so we have to pay that too...toward anesthesia, hospital charges, etc. We went to an in network facility and just got unlucky that the surgeon they called in on a Saturday night was not in network.

So all in we are out $12k for this. We always thought worse case for a year would be $6k (family max OOP in network). I didn't realize the insurance companies are legally able to be the most crooked companies on earth. Don't get me started...

I agree, I always wonder how they become so powerful in dictating our healthcare, and getting away with ...I have my battles with them....sigh..

 

[supersnoop]

I need to know the best way to do this...or if the way I think is actually the best way. :surf web:

...

I don't want to miss out on the opportunity to get the tax benefit of the money having gone through my HSA. **This would NOT put us above the max HSA contribution for the year, btw.**

As long as you are still with the same employer, the best idea is to increase your HSA withholding and seek reimbursement from the HSA once there is enough money in the account. You should be allowed to change your HSA contribution amount at any time; it does not require a "qualifying event" like other insurance changes.

If you just deposit the money into the HSA, you'll still get the federal tax deduction, but miss out on the payroll tax savings. That's another 7.62% you could save.

 

[pamjb]

You may what to check with the Human Resources/benefits person at your employer. I. Almost 95% of cases, it is the employer that dictates how medical benefits are administered. In which case,'your battle is more with them than the insurance company

 

[disneymagicgirl]

You may what to check with the Human Resources/benefits person at your employer. I. Almost 95% of cases, it is the employer that dictates how medical benefits are administered. In which case,'your battle is more with them than the insurance company

We went thru HR right away. They got BCBS to cover it as emergency so at least they paid the allowable, otherwise they would have paid nada. The part we get stuck with is the "above allowable." HR has been very helpful and sympathetic but we are stuck with the rest.