FDX medical; Purple vs Buy up, the numbers cr
10-28-2016, 06:41 AM
#1
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Joined APC: May 2005
Position: Rocking chair
Posts: 1,601
FDX medical; Purple vs Buy up, the numbers cr
Well Sort of... 
I have drilled down hard in comparing these two plans and (IMHO) think I can reasonably compare the pros and cons of each, at least as far as typical costs. The reason I say reasonably, as opposed to certain, is that some medical services or meds will work out way better for one plan or another.
Up front costs. This is fairly straight forward, and I'm only going to show the family plan (Purple pilot plus) vs Buy Up with a family. I guess the vast majority of Fedex pilots fall into this group and the comparisons with spouse only, kids only or pilot only, is probably close. Since I fall into family, that was all I'm interested in, hence my comparison.
Pay check withdraw; Purple $355.51 vs Buy Up 396.43. To save you the trouble, thats Purple ahead by $491.04 over 12 months.
To further sweeten the deal; Purple puts $4600 (you and spouse doing the health eval and meeting other requirements). That $4600 works out to $383.33 per month. Note thats slightly more than the monthly cost of Purple. So if you used NO health care in 2017, no office, no pharma, nothing; you would make $27.82 per month or $333.84 from Fedex for not using health care. It actually would be more because the money would grow in an investment account at 4% tax free, but you get the idea.
Most of us are not going to not use any health care, so which one is more cost effective vs (or to put it better, cost less) the other?? Good question, longer explanation.
The idea behind the CDHP concept is the buyer (you) will attempt to reduce the cost of services and meds because you will directly benefit from the savings if you can save some of the company love ($4600) that is set aside on your behalf for not using Buy Up. Part of the sales pitch, and the one I see with the biggest unknown, is the promise of the preventive care services excluded from consideration of your health care costs. This promise, I believe is not just for the CDHP Purple (or Orange), but also for the Buy Up. I have carefully read the documents for what qualifies for "preventive care" and all the small print surrounding it. I would suggest you also read the details closely. Knowing our dealing with Fedex in matters of law (contract) and dealing with the insurance companies in general; I see a huge opportunity to not provide the intent of preventive care, as outlined and mandated by the ACA and believe that Fedex and Anthem will deny large amounts of justifiable preventive claims and kick them back to normal claims (read: draw down your $4600 on Purple or pay co pay/deductible on the Buy Up).
So assuming the worst, and you don't get to claim certain preventative services or meds as preventative, and or you do have medical and pharma expenses that are truly from illness or accident. Here is how my math comes out, feel free to contradict and add other plausible conditions or outcomes. Starting with Purple, you start with $4600 and you also should consider the saving from not using Buy Up ($491.04 per year, the deference in monthly pay check deduction). That equals $5091.04. The annual deductible for Purple plus (family, spouse, or just pilot and kids) is $5000. Yes there is a pilot only limit, I'm ignoring it because it further muddies the water and I think the majority of families are not going to have only the pilot making claims and reaching the pilot only limit while the family doesn't. So at $91 before breakeven with (fixed) costs vs the Buy up plan, you max out the annual deductible. But the break even really isn't at $5091 because if you were on the Buy Up you would have had co pays and (depending of the tier of drug, % costs) pushing up your out of pocket expenses vs Purple. Now the math gets harder.
Co pays for Purple vs Co pays with Buy Up.
It really comes down to this, and an apples to apples comparison is, well.....complicated
To do this justice, you need to know what the company cost (the part they will pay for a service or a drug) vs co pays for the particular service rendered. Example, doctor visit, illness. if a specialist, under Buy Up, $40; straight forward, under Purple, 10% of the Fedex cost. If a specialist is paid more than $400, than co pay wins (Buy Up), otherwise you would spend less paying 10% (Purple) of Fedex costs. If you go to the hospital and get real surgery, I think Buy Up will win hands down. Pharma, not so sure. If you have a large pharma usage and it can't be claimed as preventive, you really need to look hard at the amount paid by Anthem vs your co pay, and compare the Purple way of figuring vs Buy Up.
The last part is the max out of pocket. Lower for Purple (at $8500) than Buy Up ($9750). I don't see how anyone reaches the buy Up limit, but than I haven't (thankfully) had that kind of major health event in our family. This final back stop is the "real" insurance provided by any health plan and for Purple is advertised as $3900 max out of pocket ($4600-$8500). For Buy Up, it could be worse, but only in comparison with Purple when you stay in network with Purple because the limits goes way up ($18,000) out of network with Purple but doesn't change with Buy Up.
Hope some find this useful. If not, trust your gut and remember, what ever you do, at the end of next year, if you spent more than you could have, and your spouse knows it, they will tell you (in hindsight) they knew you should have done the other.
I have drilled down hard in comparing these two plans and (IMHO) think I can reasonably compare the pros and cons of each, at least as far as typical costs. The reason I say reasonably, as opposed to certain, is that some medical services or meds will work out way better for one plan or another.
Up front costs. This is fairly straight forward, and I'm only going to show the family plan (Purple pilot plus) vs Buy Up with a family. I guess the vast majority of Fedex pilots fall into this group and the comparisons with spouse only, kids only or pilot only, is probably close. Since I fall into family, that was all I'm interested in, hence my comparison.
Pay check withdraw; Purple $355.51 vs Buy Up 396.43. To save you the trouble, thats Purple ahead by $491.04 over 12 months.
To further sweeten the deal; Purple puts $4600 (you and spouse doing the health eval and meeting other requirements). That $4600 works out to $383.33 per month. Note thats slightly more than the monthly cost of Purple. So if you used NO health care in 2017, no office, no pharma, nothing; you would make $27.82 per month or $333.84 from Fedex for not using health care. It actually would be more because the money would grow in an investment account at 4% tax free, but you get the idea.
Most of us are not going to not use any health care, so which one is more cost effective vs (or to put it better, cost less) the other?? Good question, longer explanation.
The idea behind the CDHP concept is the buyer (you) will attempt to reduce the cost of services and meds because you will directly benefit from the savings if you can save some of the company love ($4600) that is set aside on your behalf for not using Buy Up. Part of the sales pitch, and the one I see with the biggest unknown, is the promise of the preventive care services excluded from consideration of your health care costs. This promise, I believe is not just for the CDHP Purple (or Orange), but also for the Buy Up. I have carefully read the documents for what qualifies for "preventive care" and all the small print surrounding it. I would suggest you also read the details closely. Knowing our dealing with Fedex in matters of law (contract) and dealing with the insurance companies in general; I see a huge opportunity to not provide the intent of preventive care, as outlined and mandated by the ACA and believe that Fedex and Anthem will deny large amounts of justifiable preventive claims and kick them back to normal claims (read: draw down your $4600 on Purple or pay co pay/deductible on the Buy Up).
So assuming the worst, and you don't get to claim certain preventative services or meds as preventative, and or you do have medical and pharma expenses that are truly from illness or accident. Here is how my math comes out, feel free to contradict and add other plausible conditions or outcomes. Starting with Purple, you start with $4600 and you also should consider the saving from not using Buy Up ($491.04 per year, the deference in monthly pay check deduction). That equals $5091.04. The annual deductible for Purple plus (family, spouse, or just pilot and kids) is $5000. Yes there is a pilot only limit, I'm ignoring it because it further muddies the water and I think the majority of families are not going to have only the pilot making claims and reaching the pilot only limit while the family doesn't. So at $91 before breakeven with (fixed) costs vs the Buy up plan, you max out the annual deductible. But the break even really isn't at $5091 because if you were on the Buy Up you would have had co pays and (depending of the tier of drug, % costs) pushing up your out of pocket expenses vs Purple. Now the math gets harder.
Co pays for Purple vs Co pays with Buy Up.
It really comes down to this, and an apples to apples comparison is, well.....complicated
To do this justice, you need to know what the company cost (the part they will pay for a service or a drug) vs co pays for the particular service rendered. Example, doctor visit, illness. if a specialist, under Buy Up, $40; straight forward, under Purple, 10% of the Fedex cost. If a specialist is paid more than $400, than co pay wins (Buy Up), otherwise you would spend less paying 10% (Purple) of Fedex costs. If you go to the hospital and get real surgery, I think Buy Up will win hands down. Pharma, not so sure. If you have a large pharma usage and it can't be claimed as preventive, you really need to look hard at the amount paid by Anthem vs your co pay, and compare the Purple way of figuring vs Buy Up.
The last part is the max out of pocket. Lower for Purple (at $8500) than Buy Up ($9750). I don't see how anyone reaches the buy Up limit, but than I haven't (thankfully) had that kind of major health event in our family. This final back stop is the "real" insurance provided by any health plan and for Purple is advertised as $3900 max out of pocket ($4600-$8500). For Buy Up, it could be worse, but only in comparison with Purple when you stay in network with Purple because the limits goes way up ($18,000) out of network with Purple but doesn't change with Buy Up.
Hope some find this useful. If not, trust your gut and remember, what ever you do, at the end of next year, if you spent more than you could have, and your spouse knows it, they will tell you (in hindsight) they knew you should have done the other.
10-28-2016, 11:15 AM
#2
Gets Weekends Off
Joined APC: Dec 2006
Posts: 2,055
Thanks for the comparative analysis dckozak.
Purple is also tempting to me, as we rarely go to the Dr. now that our son is older. But, one more thing I would add to the comparison is the ease of use of Buy Up vs receipt/reimbursement with Purple/Orange. We will know soon enough how easy, or not, that process works out for the CDHP option.
Lastly, has anyone confirmed that we can switch back to Buy Up next year if we go CDHP now?
Purple is also tempting to me, as we rarely go to the Dr. now that our son is older. But, one more thing I would add to the comparison is the ease of use of Buy Up vs receipt/reimbursement with Purple/Orange. We will know soon enough how easy, or not, that process works out for the CDHP option.
Lastly, has anyone confirmed that we can switch back to Buy Up next year if we go CDHP now?
10-28-2016, 01:35 PM
#4
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Joined APC: Nov 2005
Position: 757 Capt
Posts: 2,418
It is the HRA that has the guaranteed 4% return, but you can't add additional funds to it.
The HSA has the ability to be invested, but I haven't seen any details on the options. HSA can add additional funds, subject to Govt limitations per your circumstances. Not sure if they are pre-tax $$ or not.
CDHPs you can still choose to contribute to an FSA-it's just limited to dental & vision since the expectation is that you'll pay your Doctor/prescription costs with the HSA/HRA $.
HSA/HRA $ only goes away when you spend it. FSA $ only allows a portion to roll over into the next year, nicer this year since it used to be a use or lose it option.
Network for buyup/cdhps are the same. You can switch back and forth each year.
One way to protect your HSA $ is by purchasing ALPAs illness/injury insurance, or a similar catastrophic coverage. Don't have the numbers in front of me, but think the annual cost was just under the savings between buyup/purple with the added bonus of th 4-4.6k of company funded HSA $
The HSA has the ability to be invested, but I haven't seen any details on the options. HSA can add additional funds, subject to Govt limitations per your circumstances. Not sure if they are pre-tax $$ or not.
CDHPs you can still choose to contribute to an FSA-it's just limited to dental & vision since the expectation is that you'll pay your Doctor/prescription costs with the HSA/HRA $.
HSA/HRA $ only goes away when you spend it. FSA $ only allows a portion to roll over into the next year, nicer this year since it used to be a use or lose it option.
Network for buyup/cdhps are the same. You can switch back and forth each year.
One way to protect your HSA $ is by purchasing ALPAs illness/injury insurance, or a similar catastrophic coverage. Don't have the numbers in front of me, but think the annual cost was just under the savings between buyup/purple with the added bonus of th 4-4.6k of company funded HSA $
10-28-2016, 01:42 PM
#5
Gets Weekends Off
Joined APC: Aug 2012
Posts: 711
I believe if you have HSA you can have only the limited purpose FSA. But, if you have an HRA (read a form of Tricare causes one to have an HRA), regardless of FedEx plan, you can still get the regular FSA as we have had in the past.
Therefore, limited vs full Flexible Spending Account is tied to having HSA vs HRA which is tied to your secondary insurance.
As I understand it, this is because HSA is considered a tax advantaged program/account and you can't double dip tax advantaged accounts by having a full HSA and a full purpose FSA.
Therefore, limited vs full Flexible Spending Account is tied to having HSA vs HRA which is tied to your secondary insurance.
As I understand it, this is because HSA is considered a tax advantaged program/account and you can't double dip tax advantaged accounts by having a full HSA and a full purpose FSA.
10-28-2016, 09:45 PM
#6
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Joined APC: Apr 2012
Position: Anchorage
Posts: 29
I am going purple. We had a similar system at my previous employer, but no monthly payment other than any pre-tax contribution and a company provided lump-sum of $2000 in January.
Healthequity.com is a very simple website to use to either reimburse yourself (direct transfer to your bank account) or have them mail a check to your provider. They also give you visa debit cards if you want to pay at the time of service. I always waited for the bill to confirm amounts, then paid with my credit card and finally reimbursed myself from health equity (for the points).
The HSA rollover is huge, and if you can have a healthy year you are sitting pretty going forward and can cover the out of pocket max pretty quickly.
Even with 2000/year and then another 50/pay check we stayed in the black with wife and 2 kids, with the 2nd arriving while under this program. I still have about $1800 left in my account, and I left my prior job in Jan this year.
Healthequity.com is a very simple website to use to either reimburse yourself (direct transfer to your bank account) or have them mail a check to your provider. They also give you visa debit cards if you want to pay at the time of service. I always waited for the bill to confirm amounts, then paid with my credit card and finally reimbursed myself from health equity (for the points).
The HSA rollover is huge, and if you can have a healthy year you are sitting pretty going forward and can cover the out of pocket max pretty quickly.
Even with 2000/year and then another 50/pay check we stayed in the black with wife and 2 kids, with the 2nd arriving while under this program. I still have about $1800 left in my account, and I left my prior job in Jan this year.
10-29-2016, 05:13 AM
#7
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Joined APC: Oct 2016
Posts: 19
I have to admit I am 99% going buy up, at least this year for varied reasons...but anyone have more details about the "health assessment" that pays $600? What information do they want from you, what exactly do they do with that information? Anyway it comes back to bite you?
10-29-2016, 05:25 AM
#8
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Joined APC: May 2006
Posts: 1,804
Originally Posted by 5Million
I have to admit I am 99% going buy up, at least this year for varied reasons...but anyone have more details about the "health assessment" that pays $600? What information do they want from you, what exactly do they do with that information? Anyway it comes back to bite you?
I'm going to check every statement I received from Anthem this year so far, but I'm pretty sure I woul still have some money left over. My initial misunderstanding was that the $4600 was a one time deal. It is not, you get that amount every year. Two good years of no need for doctors or three minimual use years and then going forward all your dedictuble would be covered. I really tried to find the "catch" but I have not been able to find it. Purple actually seems like the better plan.
10-29-2016, 06:38 AM
#9
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Thread Starter
Joined APC: May 2005
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Posts: 1,601
Originally Posted by 5Million
I have to admit I am 99% going buy up, at least this year for varied reasons...but anyone have more details about the "health assessment" that pays $600? What information do they want from you, what exactly do they do with that information? Anyway it comes back to bite you?
The other part is a willingness to do two proactive health related things that are outlined on Anthum. You have until November 30 to complete this assessment.
10-29-2016, 06:53 AM
#10
done, gone skiing
Thread Starter
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Posts: 1,601
Originally Posted by USMCFDX
My initial misunderstanding was that the $4600 was a one time deal. It is not, you get that amount every year. Two good years of no need for doctors or three minimual use years and then going forward all your dedictuble would be covered. I really tried to find the "catch" but I have not been able to find it. Purple actually seems like the better plan.
Because you can change back every year, as long as we have the option to Buy Up, I see no way they will be able to "cheap out" and not provide those funds.
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