The HDHP coming out ahead even if you use the full deductible requires a reasonably high tax rate; most current DC Bogleheads working for the government are in the 22% or 24% bracket, and owe 5.75% VA tax or even higher tax in MD or DC. If you are in the 12% bracket, or have retired to a no-tax state, the tax advantage of the HSA is reduced. But working the other way, if you are over 55, the HSA tax savings is available on an extra $1000 contribution.I worked this out several times for the DC Bogleheads, comparing GEHA Standard to GEHA HDHP. In many tax brackets, GEHA's contribution to the HSA, plus the tax savings on your own contribution, exceeds the deductible. Thus, in the worst case in which you would have paid nothing under GEHA Standard and used the whole HDHP deductible, you would come out ahead.
For federal employees - yes, but as a federal annuitant no longer making HSA contributions and in a much lower tax bracket than before when one was working - this benefit diminishes, no?
The HDHP is still likely to come out ahead in most situations. In practice, if you use the full deductible under the HDHP, you would have significant expenses under a conventional plan, such as office visit and prescription co-pays, and payment in full for lab tests and X-rays until you meet the deductible.
Statistics: Posted by grabiner — Mon Dec 04, 2023 9:44 pm — Replies 20 — Views 1300