What is a qualified high-deductible health plan?

Asked by: Willa Crist  |  Last update: October 15, 2025
Score: 4.1/5 (65 votes)

Per IRS guidelines in 2025, an HDHP is a health insurance plan with a deductible of at least $1,650 if you have an individual plan or a deductible of at least $3,300 if you have a family plan. The deductible is the amount you'll pay out of pocket for medical expenses before your insurance pays anything.

What makes a qualified high deductible health plan?

For 2025, the Internal Revenue Service (IRS) defines a high-deductible health plan as any plan with an annual deductible of at least $1,650 for an individual or $3,300 for a family. The maximum out-of-pocket expenses for an HDHP are $8,300 for an individual or $16,600 for a family.

What makes a health plan HSA-eligible?

What's considered an HSA-eligible plan? Under the tax law, HSA-eligible plans must set a minimum deductible and a limit, or maximum, on out-of-pocket costs for both individuals and families. The minimum deductible is the amount you pay for health care items and services per year before your plan starts to pay.

How do I find out if my health plan is HSA-eligible?

According to the IRS2 , HSA-qualified HDHPs must have:
  1. A higher annual deductible than typical individual health insurance plans.
  2. A maximum limit on the annual deductible and medical expense costs, including copays and other items.
  3. No insurance coverage until the deductible is met, except for the following expenses:

What disqualifies you from having an HSA?

If you can receive benefits before that deductible is met, you aren't an eligible individual. Other employee health plans. An employee covered by an HDHP and a health FSA or an HRA that pays or reimburses qualified medical expenses can't generally make contributions to an HSA.

Understanding Cost Sharing with a Qualified High Deductible Health Plan

19 related questions found

What is the downside of an HSA?

Drawbacks of HSAs include tax penalties for nonmedical expenses before age 65, and contributions made to the HSA within six months of applying for Social Security benefits may be subject to penalties. HSAs have fewer limitations and more tax advantages than flexible spending accounts (FSAs).

What counts as a high deductible health plan?

True to its name, the deductible is higher. Plans will vary, but generally a minimum of $1,650 for individuals and $3,300 for families1. Will vary by plan and by employer, but generally are lower. Out-of-pocket limits are higher in an HDHP.

Does Blue Cross Blue Shield have an HSA account?

A CareFirst BlueCross BlueShield Health Savings Account (HSA) plan has two main components: A medical plan that meets certain IRS criteria* A medical savings account called an HSA.

What are the disadvantages of a high-deductible health plan?

Disadvantages of a high deductible health plan
  • You pay all costs for nonpreventive care until you've paid the high deductible.
  • Possible unplanned high out-of-pocket costs when you receive covered services.
  • Worries about money might influence your health care decisions.

What is the 12 month rule for HSA?

It means you must remain eligible for the HSA until December 31 of the following year. The only exceptions are death or disability. If you violate the testing period requirement, your ineligible contributions become taxable income.

Why would I not be eligible for HSA?

HSA: Eligibility

You must participate in a High Deductible Health Plan, have no other insurance coverage other than those specifically allowed, and not be claimed as a dependent on someone else's tax return in order to be eligible for an HSA.

What qualifies as a high-deductible health plan in 2024?

For calendar year 2024, a “high deductible health plan” is defined under § 223(c)(2)(A) as a health plan with an annual deductible that is not less than $1,600 for self-only coverage or $3,200 for family coverage, and for which the annual out-of-pocket expenses (deductibles, co-payments, and other amounts, but not ...

What is considered an HSA plan?

A type of savings account that lets you set aside money on a pre-tax basis to pay for qualified medical expenses.

Who qualifies for HSA?

To open an HSA, you must be enrolled in a qualified HDHP, and you cannot be claimed as someone else's dependent on their tax return. You also cannot contribute to an HSA if you have disqualifying additional medical coverage, such as a general-purpose health flexible spending account (FSA), at the same time.

What does IRS consider a high-deductible health plan?

An HDHP is health coverage with a: Higher annual deductible than typical health plans and. Maximum limit on the sum of the annual deductible and out-of-pocket medical expenses that the taxpayer must pay for covered expenses. Out-of-pocket expenses include copayments and cost sharing but do not include premiums.

Who should avoid a high-deductible health plan?

While these types of plans can be beneficial to those who are relatively healthy, they can be very expensive for those who have chronic conditions or who experience a medical crisis. It's important to carefully consider your expected medical expenses before choosing to participate in a high deductible health care plan.

Is it worth having a high deductible health plan?

HDHPs have higher out-of-pocket costs than LDHPs. So, this type of plan is best for healthy people who expect little to no healthcare expenses. If this outlines your scenario, the HDHP's lower premium will likely save you more money than you would spend on medical care.

How much does a doctor visit cost with a high deductible health plan?

A rough guide is: New Patient Office Visit: $200 - $450 depending on how much time is spent on evaluation and/or how many medical conditions are addressed. Subsequent Office Visits: $75 - $300 depending on how much time is spent on evaluation and/or the number of medical conditions being addressed.

Is it better to have HDHP or PPO?

HDHPs can be a good form of insurance for the young and healthy — especially if your employer offers you HSA contributions. But for anyone with significant medical expenses, an upcoming surgery, or a serious health condition, a PPO could be a better fit because of the lower deductible.

How do I know if my insurance is an HSA?

How to Know If Your Insurance is HSA-Qualified
  1. The minimum deductible must be no less than $1,350 for individual plans and $2,700 for families.
  2. Maximum out-of-pocket cost for the annual deductible and expenses, such as copays, can't exceed $6,650 for individuals and $13,300 for families.

Does BCBS have a high deductible health plan?

The HDHP has medical deductibles of $2,000 and $4,000, all medical and prescription expenses are charged at the discounted amount until your deductible is met.

Can HSA be used for blue light glasses?

Some items, like blue-light glasses, may be FSA or HSA eligible if your plan administrator allows it. However, you may need a letter of medical necessity to get this expense approved.

Is $3,000 a high deductible for health insurance?

The higher the deductible, the more out-of-pocket costs you pay before your insurer begins covering medical expenses. The IRS defines high-deductible health plans for 2023 as: Individual plans with deductibles of at least $1,500. Family plans with deductibles of at least $3,000.

Can you open an HSA on your own?

Your employer may offer a High Deductible Health Plan (HDHP), or you may purchase an HDHP on your own. Once you are enrolled in an HDHP, check to see if an HSA was automatically opened for you by your insurer. If not, you can open one with a bank or another financial institution that offers HSAs.

Is HSA worth it?

One of the biggest advantages of an HSA is that it offers a triple tax advantage, which means: Contributions to an HSA are federally tax-deductible, reducing your taxable income. Depending on where you live, you may also get a break on state income taxes. Assets in an HSA can potentially grow federal tax-free.