The Benefits of a High Deductible Insurance

You can count on health insurance to lighten you burden in case of an accident or illness but for most people, they come at a steep price. A health plan with a high deductible will lower monthly premiums. A health plan with a high deductible is called a High Deductible Health Plan (HDHP) or a catastrophic health insurance. The deductibles can range from $1,000 to $10,000. With a high deductible, policy holders are able to lower their premiums by 40% to 50% compared to the conventional health care plan.

The HDHP is recommended to young policy holders who do not have chronic conditions. They do not have to get the benefits of the health insurance right away and they can afford the premiums. Older policy holders can still benefit from HDHP, as they can pay for expenses through more affordable premiums. HDHP affords policy holders with good health condition tax benefits when combined with a Health Savings Account (HSA). You can get money for medical expenses without paying for tax. For people beyond 65 years old, they can withdraw money from their HAS for any purpose.

HDHP is also a good option for a company health care coverage. A high deductible insurance can pay for medical expenses for up to $1,000 a year. The unspent amount will be carried on to the proceeding years. Combining HDHP and HAS can save the company as much as $500 without compromising the health benefits of its members.

Policy holders must be wary though. If they already have an existing chronic disease, these may turn out to be more expensive. This type of health insurance is advantageous to do those who do not spend a lot on annual health care costs. If you do not have any existing ailment or illness, you can avail of HDHP.

Filed Under: Health Insurances


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