Will Trice <wwtrice[at]paragondynamics.com> wrote:

- quote -

Yeah I think he is as well

Cal wrote:
- quote -

I think YOU are (rudely) confusing THE OP's HDHP deductible WITH the HSA
contribution. OF course, IT may make THE most sense TO have A
deductible NEAR the HSA contribution LIMIT.

-Will

TB wrote:

- quote -

Yah, I have the mother of all scars on my back to prove it (from a mole
removal). Crappy med student care, but the price was right at the time...

-Will

Cal wrote:

- quote -

Well, if used for medical withdrawals, the money is completely federal
tax free, both on contributions and distributions - you don't find that
often. If used for other expenses over the age of 65, it acts like a
deductible IRA or 401(k) (for tax purposes). Still pretty cool.

-Will

Cal wrote:

- quote -

Randomly capitalized WORDS aside, there is a penalty for
non-medical-expense withdrawal if you are under the age of 65:
http://www.treasury.gov/offices/publ...aq_using.shtml

-Will

TB <borekfm[at]pacbell.net> wrote:

- quote -

What I'm finding strange is the concept that a personal
policy with high deductible used in conjunction with
HSA can SOMETIMES be much cheaper than a traditional
group policy!

A 5k deductible policy cost abt 4100 month for me at
age 48..... again when used in conjunction with HSA

How can that be?

TB <borekfm[at]pacbell.net> wrote:

- quote -

Bingo!

Exactly my thinking as well

me[at]privacy.net wrote:
- quote -


My employer offered a high-deductible plan with a HCSA this year. They
even kicked in a little seed money for the HCSA.

I opted for the same plan with a lower deductible and no HCSA because
the deductible was just too much until I test drove the plan for a year
with a regular deductible. I think the high-deductible was over $5000
for a family of 3 or more, and not a huge difference in premiums.

I'll reevaluate next year.

Bob

:
- quote -


What you are in all probability looking at is a STANDARD MAJOR MED policy.
They come in ALL sizes, 2,500, 5,000, 10,000 & 25,000 deductible.
An HSA requires by LAW the following.




Health Savings Accounts
How They Work
THE HISTORY:
Beginning in 1992, J. Patrick Rooney (the current Chairman of Medical
Savings Insurance
Company) began talking with members of Congress about an idea to
control the spiraling cost of
health insurance.

His idea was to have people purchase high deductible insurance to
cover the
big bills and have a tax-advantaged account under the big deductible
to cover the small bills.


In 1996, Congress passed, and the President signed, the Health
Insurance Portability and
Accountability Act (HIPAA).This legislation created a 4 year pilot
project called Medical
Savings Accounts (MSAs) that began January 1, 1997. MSAs were limited
to the self-employed
and small groups. The project was extended until December 31, 2003.


In 2003, through the combined efforts of Pat Rooney and others,
Medical Savings Accounts were
changed and are now called Health Savings Accounts (HSAs). HSAs are
available to anyone
under age 65 who has the qualifying high deductible health insurance
in force.




HOW HSAS WORK:
With an HSA, you divide the money you would normally spend for full
coverage health
insurance into two parts:


Part One:
You buy a much lower cost medical insurance plan to cover the big
bills- the deductibles range
from $1,050 to $2,700 for singles and $2,100 to $5,450 for families.


Part Two:
The rest of the money you would normally spend on health insurance you
can put (tax-deductible)
into a Health Savings Account (up to the amount of the deductible).
This money
belongs to you; what you don't spend is yours to keep. Medical Savings
Insurance pays 5%
interest on any balance in the account. The interest accumulates
tax-free.


You can pay out-of-pocket medical expenses from the HSA - or simply
save it. If you do use
the money from the HSA for medical bills, the money comes out of the
account tax-free.



------------------------------------------

Cal Lester CLU

<me[at]privacy.net> wrote
- quote -

Dunno that this is very germane or even true.

- quote -

Right, that's why it's cheaper: One takes on more risk.

The way this agent about the HSA as being "cheaper" when
used with a high deductible plan is kind of funny wording.
I suppose he was just sound biting the concept of using a
high deductible plan with an HSA.

You can shop around on the net for health insurance, just to
get ideas of who is out there. Try googling for "health
insurance," and a number of comparators come up.

Here's some interesting commentary from the University of
Michigan on its health services and insurance for students.
UofM is one of the larger universities in the U.S. In a
nutshell, they recommend buying insurance in addition to the
"insurance" students receive via the health services fee
included in tuition. The health services fee seems to amount
to a little under $500 for a full year, except it does not
cover periods between terms. It does not cover a lot of
things. But a student with reasonable health might be fine
with just it. The health insurance the University recommends
in addition is nearly $2000 per year.

http://www.uhs.umich.edu/insurbill/insurancestud.html

Elle
Not an insurance agent or financial planner. "Just" a
do-it-yourselfer who reads a lot about health insurance
issues in general.

me[at]privacy.net wrote:
- quote -

OK, I can see how that's a different setup - the last school I went to
was big and had a med school & teaching hospital, and all the student
plans were tied into it. Cheap guinea pigs for med students = cheap
insurance?

I just tried a few scenarios on ehealthinsurance.com and it looks like
the higher-deductible HSAs are the cheapest alternatives for a
hypothetical student born in 1987. There were some "student" plans (they
have a link for this on the site) but they are only available for
students under age 29. And as Elle found, they looked kind of lousy.

At 48 you might view this as more of a long-term question. These days it
can be difficult to just get insurance, if you have anything worse than
a hangnail in your medical history (if buying in the individual market
rather than the group market - in most states anyway). So there's
something to be said for shopping around and finding a plan that would
work regardless of how school goes the next couple years (part time or
full time). There's no penalty to working with an agent to figure this
out, the insurance will cost the same regardless.

-Tad

"Cal" <cal-lester[at]comcast.net> wrote:

- quote -

What are you talking abt?!

I'm setting here right now looking at a policy that has
5k deductible!

- quote -

Don't you READ these posts. A number of people have already
explained to you that you CAN NOT HAVE A 5K DEDUCTIBLE.
Cal Lester CLU

"Elle" <honda.lioness[at]nospam.earthlink.net> wrote:

- quote -

That's exactly what the people at my local junior
college told me to do when I asked them abt going back
full time and getting health insurance thru them.

They told me to go talk to independent insurance agent
which I did last Friday

Now I don't know if I can trust this agent but he says
that OFTEN times an HSA used in conjunction with high
deductible health insurance plan is CHEAPER than groups
insurance rates!!

His theory is that the "pool" is much much bigger when
you have individual health insurance plan. Plus with a
5K deductible you are taking on a LOT of risk that
normal group plans don't do. So you are rewarded with
much lower rates than you think

True? False?

"Tad Borek" <borekfm[at]pacbell.net> wrote
- quote -

I think a lot of the older folks--long out of school--still
bring this up. The health care and insurance system were not
facing the crunch they are now.

- quote -

through their colleges or universities. The student plans in
fact strike me as sometimes preying on the naivete of young
people. The health care and health insurance crisis leaves
none but the very wealthy untouched, ISTM.

The OP should check, but I no longer get students hopes up
and instead suggest they check out the private catastrophic
plans available that are completely independent of any
offering through a student's college or university. They
seem as or more competitive.

Tad Borek <borekfm[at]pacbell.net> wrote:

- quote -

Unfortunately the junior college I'm looking at going
to full time does NOT have any health coverage
available

Now if I change my mind and go to a diff college
(bigger)..... I do agree it might be better to just get
coverage thru the college. But like I said no option at
the junior college I'm going to part time now

You see.... I'm 48.... and never went to college out of
high school. Big mistake. So I started going to
college part time a few years ago.

My concern is.... I'm advancing so slowly that maybe it
would be better for me to quit work and go back full
time an "get er done".

Hopefully the increase in income from better job after
college would make up for lost opportunity costs of no
income while not working? That's the "hope" anyway.

But like you said.... I could find a bigger college
that DOES have health insurance coverage and go there
instead. And as you said there may be better self
insurance plans available in four years huh?

- quote -

Typo above

should read OVER RIDING

me[at]privacy.net wrote:
- quote -

OK few details to add:

* The 2006 HSA contribution limit is $2700 for an individual, $5450 for
family coverage, even if the plan's deductible is higher. If the
deductible is lower, your contribution limit is equal to the deductible.
You couldn't put in $5k in a single year.
* this limit is prorated for the number of full months you're covered
during the year (eg 6 months in 2006 means $1350 limit)
* A principal benefit of making that HSA contribution is that you write
off, say, $2700 from your income, and your taxes are lowered
accordingly. But it sounds like you might be in a low tax bracket anyway
so that benefit would be small. You might even be in the 0% bracket.
* On the flip side if you don't use the $2700 it sits there earning
interest (or, eventually, sitting in mutual funds, if you choose) and
you can tap the account for medical expenses later. Some details - Will
posted this link on a prior thread - helpful info, I learned a few things:
http://www.ustreas.gov/offices/publi...ng.shtml#hsa16

* If you never use the $ and it just grows over the years, then upon
retirement you can essentially treat it as another IRA. So one way to
look at an HSA is a $2700 IRA contribution that you can tap into for
medical expenses along the way. In that view the benefit 10+ years from
now might be attractive even if you get no immediate tax benefit.

Netted out though I suspect a student plan, if you find one, would be a
better fit at this point. If you had an extra $2700 sitting around you
could stick it in a Roth IRA. [If you've maxed that out - well heck how
many college students are rolling in dough like that? If you are, borrow
less, maybe?] Four years from now you can revisit all this after your
student plan goes away. By then it's conceivable we'll see new offerings
in health insurance anyway.

And to answer your original question directly - I have an HSA and
started with the original MSA program. But I'm able to shift $ from
savings into them every year and I get a tax benefit from those
contributions. If I were a student I'd certainly look into a student
plan instead.

-Tad

<me[at]privacy.net> wrote in message
news:11e1d29kerumku80vjvcuqvfnfhkqjn0cq[at]4ax.com...
- quote -

Apparently none.
Cal Lester CLU

"Cal" <cal-lester[at]comcast.net> wrote:

- quote -

I'm not being argumentative or anything here but I'm
still not seeing the big value of the HSA account over
just having 5k in an ING acct.

I mean..... the tax benefits on 5k wont be that much.
No?

I will be unemployed and only working part time and my
income will be low anyway as well as my taxes

So maybe you can break it down for me... what is the
OVER RIDJBG reason for someone like me to even have the
HSA acct?

Why not the ING acct and my own high deductible health
insur plan