HDHP vs PPO + HSA Optimizer — 2026 Open Enrollment

A health plan with a deductible of at least $1,700 (self-only) or $3,400 (family) for 2026, and an out-of-pocket maximum of no more than $8,500/$17,000. HDHPs trade lower premiums for higher upfront cost-sharing — and only HDHPs let you contribute to a Health Savings Account (HSA). Not every plan with a high deductible is HDHP-certified — your benefits portal labels the qualifying option (sometimes "HSA-eligible" or "consumer-driven").

The fastest rule: at minimum, contribute the difference between the HDHP and PPO premium savings — that money was going to insurance anyway and now compounds tax-free. Better: contribute up to the IRS limit ($4,400 self / $8,750 family for 2026, + $1,000 if 55+). If you can pay current medical expenses out of pocket, invest the HSA balance and treat it as a tax-perfect retirement account.

Not a general-purpose FSA — IRS rules prohibit double-dipping. But you CAN pair an HSA with a Limited-Purpose FSA (dental + vision only) or a Dependent-Care FSA (childcare). If your employer offers a Limited-Purpose FSA, it’s a way to stretch HSA-tax-savings over dental/vision while keeping the HSA for medical. If your spouse has a general-purpose FSA, you’re disqualified from HSA contributions.

You pay up to the out-of-pocket maximum ({{oopMax}}/{{oopMaxFamily}} for 2026 HDHP max) — but no more, no matter what. The HSA helps absorb this: contributions are tax-deductible whether or not you spend them, and you can pull funds tax-free for qualified expenses. Always keep an emergency fund covering at least the HDHP deductible (1.5× is safer). If the year goes badly, you still typically come out ahead in any year your HDHP premium savings + HSA tax benefit + employer HSA contribution exceed the difference in out-of-pocket spending.

Medical-only HDHPs don’t cover dental and vision — those are separate benefit lines. BUT, you can pay dental, vision, orthodontia, LASIK, contact lenses, and prescription eyewear from HSA funds tax-free. That’s often the easiest way to use HSA dollars in years with low medical spend.

Both reduce your taxable wages, but the HSA is strictly better: (1) HSA funds roll over forever — FSA funds are use-it-or-lose-it by year-end with at most $640 carryover; (2) HSAs can be invested for tax-free growth; (3) HSAs follow you when you change jobs; (4) HSAs work as a retirement account after 65. The only FSA advantage is timing — you can spend the full FSA election from day one, while the HSA is funded over the year.

The HSA is yours forever — it’s an individual account, not employer-owned. When you change jobs, you can keep it at the same custodian or roll it to a new one (e.g., Fidelity HSA, which has lower fees and broader investment options). Even if you no longer have HDHP coverage, your existing balance keeps growing tax-free and you can spend it on qualified medical at any age. New contributions stop until you re-enroll in an HDHP.

No — once you enroll in any part of Medicare (typically at 65, or earlier with disability), you can no longer contribute. You CAN still spend existing balances on qualified medical expenses tax-free, including Medicare Part B premiums, Part D, and supplemental Medigap premiums. Many people stop contributing 6 months before age 65 to avoid Medicare Part A backdating issues — talk to a benefits advisor.