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Is a High-Deductible Health Plan Right for you?

February 27, 2017

High-deductible health plans (HDHP) are attractive because they seemingly reduce your health care spending.

But that’s not always the case.

With a low-deductible plan, you’ll have predictable medical expenses and typically better coverage, but it’s difficult for most consumers to deal with the higher monthly premiums. Turning to a plan with a lower premium and a higher deductible seems like a good way to lower expenses.

But you’ll have to be ready to manage a deductible that’s as high as $5,000, or even more. You’ll have to choose a plan that gives you the flexibility to use a health savings account (HSA), too, which will help deal with pretax expenses. But this requires financial discipline, which many consumers think they’ll be able to comply with, but ultimately don’t.

Is it right for you?

This kind of plan might be right for you if you:

  • Are healthy and don’t get sick very often  –  or injured.
  • Can afford to pay the full deductible out of pocket, or at least within the 30 or so days you’ll have to pay your medical bills.
  • Can contribute to an HSA  –  and choose a plan that allows you to contribute to one  –  so that you have the full deductible amount available from this account.

Unfortunately, most people aren’t able to commit to the savings and financial discipline required to make this plan a reality.

Is it wrong for you?

A high-deductible plan is not right for you if you meet any of these conditions:

  • You are pregnant or plan to become pregnant soon.
  • You have small children.
  • You have a chronic illness.
  • You visit the doctor often.
  • You are older than 65.
  • You are planning on having a procedure done, like a hip replacement.
  • You take several medications, or an expensive drug.
  • Your children play sports and are at high risk for an injury.

You’ll also need to be proactive about your health with a HDHP. If you need treatment, you should do lots of research before committing to care in order to find cheaper treatment options. You’ll also need to manage your out-of-pocket expenses carefully, and make sure you stay on top of medical bill payments.

If you aren’t able to be disciplined about saving for health care costs, you could end up in a financially devastating situation. With lower premiums, you won’t be saddled with a higher monthly health insurance payment, But on the other hand, if you aren’t diligent about finding generic medications, for example, that you can take, you may end up paying a lot more for prescription drugs.

The bottom line is, with a high-deductible health care plan, you put a lot at risk if you become sick or get injured. There is no way to plan for these things. You’ll have to be at-the-ready to deal with higher copayments, hospitalization cost caps and additional out-of-pocket expenses.

In addition, people with HDHPs often forego preventive care, services that usually are not included in these kinds of plans. The more you avoid preventive doctor visits and tests, the more likely you will be to become ill down the road.

If you’d like help weighing the pros and cons of a high-deductible health plan, contact InsureOne Benefits today. We’re happy to discuss the plans in detail and help you choose a policy that best suits your needs and budget. Give us a call today!

InsureOne Benefits

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