I am starting my first job and must choose HRA, HSA, or Traditional health insurance. Which is best for me?

Question

There are 2 different HRA plans. There is an HSA plan, as well as a Traditional plan. I am a 23 year old recent college grad male. I have no health problems and consider myself to be in extremely good shape. Based on these factors, can someone recommend which plan will be best for me? Thanks for your time!

Answer 1

Because you are young and healthy I would choose the HSA plan.

Health Savings Accounts are combined with a High Deductible Health Plan (HDHP) to offer a more affordable approach to health care. If your young and healthy why pay the higher premium for a traditional plan?

Premiums for HDHPs are lower.
HSAs have a tax favored status - meaning what you contribute is either pre-tax or tax deductible. Interest earned on the money is tax-deferred.
Using the money to pay for qualified medical expenses is tax-free.
Lower insurance premiums combined with using tax-free money can lead to significant savings.

You don't lose your unused HSA contributions (up to $2,850 per year for a single person) as they rollover from year to year.

As time goes on and your account balance grows you would not have a problem funding the deductible.

BTW, You don't have to submit qualified expenses to your plan administrator as you just write a check out of your HSA account.

Answer 2

If I under sand you correctly. The HSA is a Health Savings Account. You can put a few 20 or 30 bucks a month into the HSA, then collect reimbursement for co-pays, non-covered items, over the counter medications, etc. But you have to submit the forms.
That is not a traditional health plan. You need a traditional plan. You can choose a high deductible.

Answer 3

My experience is that most younger folks go for the HSA plans, but a traditional plan with a doctor's office copay and immediate prescription drug coverage can be nice should you need it.

If it was me, I would base my decision on what I could afford (assuming you are paying for the plan.) If cost is not a problem - maybe go with the traditional plan. You could also ask co-workers which plan they have been most pleased with.

Learn more about HSA plans here in the interim:

http://www.ohioinsureplan.com/index.php/insurance/hsa-accounts/