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HDHP HDHP stands for high deductible health plan. Typically, this includes any plans that offer a deductible higher than 1,000 dollars for individuals and 2,000 dollars for families. As with most plans, the deductible is the amount of money that has to be spent out-of-pocket before the insurance pays for anything. Obviously, the higher the deductible, the less expensive the plan, but the longer it may take for coverage to kick in. Using an HDHP with an HSA Getting an HDHP on its own is practically useless unless you want to have some type of coverage for expensive medical emergencies. Nevertheless, when it comes to regular heath concerns, such as doctor's visits or prescription medication, having a high deductible guarantees you will be paying everything out of pocket for most of the year. Fortunately, an HDHP can be combined with a health savings account (HSA) to provide excellent coverage. An HSA works in similar fashion to most IRAs. Money is placed into a tax-deductible account, although in this case it is to be used for medical expenses. Through the use of a check or debit card, the money in the HSA can be used for a wide variety of expenses. The HDHP is required in order to have an HSA and offers coverage protection once the deductible has been met. The major advantage of using an HDHP with a take care® HSA is the greater flexibility this combination affords patients. Since they control the money in their savings accounts, they have a greater choice of physicians, drugs, and procedures to choose from. Almost anyone is eligible for this combination and most simply divide the money they used to spend on older plans to cover the costs of this effective combination. |
Additional Topics Consumer-Directed Health Plans Consumer-Driven Health Accounts Dependent Care Flexible Spending Accounts Flexible Health Spending Accounts Flexible Medical Expense Accounts Healthcare Flexible Spending Accounts Health Reimbursement Arrangements IRS Section 125 Cafeteria Plans Medical Expenses and Income Tax Plan for Medical that Health Insurance Doesn't Cover Save 25% to 40% on Health Expenses Save on Co-Pays and Over-the-Counter Medications Save on LASIK and Orthodontic Costs Section 125 Plan Administration |
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