Who would be a good candidate for a high-deductible health plan?
Asked by: Dr. Dimitri Walter | Last update: October 2, 2025Score: 4.7/5 (28 votes)
Who should select 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.
Who is a good candidate for an HDHP plan?
If you're generally healthy and don't have medical expenses beyond annual physicals and preventive screenings, an HDHP could save you several hundred dollars or more a year.
Why would someone get a high deductible health plan?
Pros. Lower monthly premiums: Most high-deductible health plans come with lower monthly premiums. If you anticipate only needing preventive care, which is covered at 100% under most plans when you stay in-network, then the lower premiums that often come with an HDHP may help you save money in the long run.
Who should not use a high deductible health plan?
A chronic illness, such as heart disease or diabetes, can be much more expensive to manage under an HDHP than a traditional health care plan. With these conditions, regular medications and health screenings may be required. These costs may quickly add up until deductibles are finally met.
How does a High-deductible Health Plan (HDHP) work?- Kaiser Permanente
Who uses high-deductible health plan?
An HDHP is best for younger, healthier people who don't expect to need health care coverage except in the face of a serious health emergency. Wealthy individuals and families who can afford to pay the high deductible out of pocket and want the benefits of an HSA may benefit from HDHPs.
How do I determine if HSA is right for me?
The decision is different for each individual. If you are generally healthy and/or have a reasonable idea of your annual healthcare expenses, then you could save money from the lower premiums and valuable tax-advantaged account with an HSA/HDHP plan.
What is the downside of a high deductible?
The primary disadvantages of a high-deductible health plan include the high out-of-pocket costs and the potential reluctance to seek medical care due to upfront expenses. While HDHPs have lower premiums, individuals may face financial strain if they need medical services before meeting the deductible.
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 ...
Why would someone choose a higher deductible?
If you are generally healthy and don't have pre-existing conditions, a plan with a higher deductible might be a better choice for you. Your monthly premium is lower since you're only visiting the doctor for annual checkups, and you're not in need of frequent health care services.
How do I know if a HDHP is right for me?
If your in-network medical expenses would trigger the catastrophic limit, you may also want to consider an HDHP, if the nature of those expenses is such that you continue to pay out-of-pocket costs in your traditional plan even after you hit your traditional plan's lower catastrophic limit.
How do you qualify for HDHP?
Under the section heading Health Savings Account (HSAs), the paragraph under Eligibility, a qualifying HDHP must have a deductible of at least $1,600 for self-only coverage and $3,200 for family coverage.
What is the average high deductible health plan?
In 2023, the median annual deductible for private industry workers participating in HDHP plans was $2,500. For private industry workers participating in non-HDHP plans, 18 percent did not have an annual individual deductible. For the 82 percent with a deductible, the median annual deductible was $750.
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.
What is the upside to having a high deductible?
This means you'll pay less each month for insurance and more out-of-pocket when you receive care. The upside? Preventive care is still covered at 100 percent on these plans. Once you hit your deductible, your health plan will start to cover the cost of your other care.
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.
What circumstances are best for a HDHP?
If you're in good health, rarely need prescription drugs, and don't expect to incur significant medical expenses in the coming year, you might consider an HDHP. In trade for lower premiums, HDHPs require you to meet your deductible before you get any coverage for treatment other than preventive care.
How to qualify for HSA 2024?
HSA eligibility
To contribute to an HSA, you must be enrolled in an HSA-eligible health plan. For 2024, this means: It has an annual deductible of at least $1,600 for self-only coverage and $3,200 for family coverage.
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).
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.
What is the point of high deductible health insurance?
Savings tip: HDHPs have lower premiums. That means you pay less every month for your plan. Plus, you're covered for many preventive services and screenings at no cost without having to meet your deductible. When the plan year begins, you pay the full cost of your care until you reach a fixed dollar amount.
Does a higher deductible make your insurance cheaper?
With a higher deductible you'll pay more out of pocket, but your car insurance rate will be lower.
Do you get a tax break for having a high-deductible health plan?
Leverage the tax breaks.
The HSA that comes with an HDHP offers a potential triple tax advantage2, that helps you save on taxes: Your HSA contributions are made pre-tax. Interest and any investment earnings in the account are tax-free. Your payments for qualified medical expenses are tax-free.
Who is an HSA best for?
A health savings account (HSA) can be a very good deal, especially for someone in their 20s and 30s who's just starting out. If you're enrolled in a high-deductible health care plan (HDHP)i that offers an HSA, consider using it to sock away extra money for future medical needs.
What are the disadvantages of a high-deductible health plan?
The cons of high-deductible health plans
Yes, HDHPs keep your monthly payments low. But there are some downsides you should consider, including: Large medical expenses: Since HDHPs generally only cover preventive care, an accident or emergency could result in very high out-of-pocket costs.