To HSA or not to HSA, that is the question

Demographics:Single, over 55.  Typical out of pocket medical expenses are $3000.

 

Insurance options:

A. High deductible plan that is HSA-eligible.

B. High deductible plan that is not HSA eligible because it includes a $600 HRA (health reimbursement arrangement) and FSA option.

 

The premiums and deductibles for plan A and B are identical but the stop-loss for plan A is slightly higher because the IRS keeps increasing it. 

 

I have been taking plan B.  The HRA covers $600 of my out of pocket expenses (free money from my employer) and I have a $2400 FSA, so my other expenses are pre-tax, but I don't accumulate anything.  If I switch to plan B in 2025, I could contribute $5300 to an HSA.  I lose the $600 in free money, but I would accumulate $2000 per year in an HSA that I could keep after retirement.  However, age 65 is only about 8 years off, so my maximum holdover HSA would be $16,000.  In order to get the extra pre-tax $3000 to contribute to the HSA (over the $2400 I already put in an FSA) I would have to reduce my Roth IRA contribution by $2100 per year.  

 

Every time open enrollment comes around and I think about this, I always decide that the $600 of free money and putting extra money in the Roth IRA is better than accumulating an HSA, especially given the short time frame.  Do you agree, or am I missing something?