Using home.php but now can't get posts to show?

I’ve created a Home.php which I’m using obviously for my “home page” for the site. That page works okay, still some things I’d like to see work differently but for all intents and purposes – it works.

The issue I’m having is that I can’t get posts to show in a blog setup if I leave the “Front page displays” option set to “Your latest posts”. If I change the setting to “Static Page” don’t set anything for home page and select the Blog page I created as the “Posts page” – I can save the settings but when I go to the blog page it still shows my Home.php file.

How can I setup this theme so that home.page shows as the main page and still have a blog page as well?