A little background: earlier this year I wrote about our need to make a health insurance change and our decision to take out a high deductible health insurance policy and open an HSA in order to save for unreimbursed medical expenses in a tax-advantaged account.
Then 2 1/2 weeks ago I fell and broke my wrist in a way that required an ER visit and then surgery. (You can read the circumstances of the fall here if you care, but it’s not a terribly interesting story. I keep saying I should make up a better one.)
Once I got through the holy crap my wrist is broken moments, the holy crap this is going to be expensive moments starting settling in.
What it means is this: I will definitely, positively reach my $6300 deductible this year. This month, in fact.
That money is set aside in our fully-funded HSA for this year (the maximum a family can contribute in 2014 is $6550). As I wrote in my March post, our plan was to leave that money in the HSA and treat it as additional retirement savings and pay for our medical expenses this year out of our (after tax, non-HSA) pockets.
Obviously that plan is in question now, but I’m not tapping the HSA quite yet.
I like a challenge enough to see if we can pay for the rest of my $6300 deductible (some of it had already been met due to weekly allergy shots and an eye exam) out of pocket and still leave the HSA alone, knowing that we can always tap it later if need be.
I’ll admit, I was a little more anxious about the financial implications of this at first, but some things I already knew were reinforced through this experience:
- The high deductible medical policy and HSA were meant to work together. While we hope to use our HSA as additional retirement savings, the real reason to fully fund one is for an event just like this one.
- If you’re using an HSA, keep records of all medical expenses in case you need to pull HSA money out. It doesn’t have to be a big deal. On the advice of our CPA I simply labeled a file folder and now drop everything from pharmacy receipts to dentist statements to (sadly) surgi-center paperwork into it.
- Emergency savings are important. We’ve been using some of our found money to beef up our emergency fund. You can read about that in my found money updates.
- Even with hitting my deductible, we are ahead of where we were last year because our monthly premiums for this high deductible policy are so much lower than our old premiums were. That won’t necessarily be true for everyone who goes this route, but for us, the math is working out.
The good news? Well, for one I’m right handed and it was my left wrist I broke. I’m grateful for that every day. And my super smart husband realized that the plastic bag they deliver your newspaper in fits perfectly over an arm with a splint or brace on it for baths and showers. That was an a-ha moment.
But financially speaking, the silver lining is that now that my deductible has been met, the rest of my medical expenses for the year are covered at 100%. That includes those allergy shots I’m still getting and a colonoscopy that my doctor will no doubt recommend since I’m turning the big 5-0 this year.
Hopefully that’s all I’ll need to worry about, because I’ve had quite enough medical excitement for one year.