"Save thousands on health insurance."
"Cut your premiums in half."
We've all seen the ads for high-deductible health plans (HDHPs), touting their low rates. But do lower rates mean less coverage? And if they are so good, why do so few workers opt for them? What about a high deductible health plan with HSA? What exactly is this all about?
Like traditional health care plans, HDHPs usually cover a wide range of medical and prescription costs—but only after a steep annual deductible has been paid. Such deductibles can run from as low as $1,150 for individual coverage, to upwards of $7,500 for family coverage, depending upon the plan. These plans seek to drive down health care costs by placing more of the responsibility and cost burden on consumers, in effect, forcing them to be more cost-conscious when deciding on medical care.
HDHPs generally appeal more to healthier people with no chronic ailments that require regular care. That's because high-medical-maintenance individuals are likely to end up burning through the entire deductible, effectively upping the costs above low-deductible plans. For instance, an HDHP with a monthly rate that is $100 less than a low-deductible plan will end up costing more if you end up shelling out over $1,200 before you use up the deductible.