Savings with High Deductibles

When President Bush signed a bill in 2003 allowing employees to create HSA’s, or Health Savings Accounts, it was in the hopes that individuals would be able to save in the area of high costs in health care and insurance. One stipulation, however, was that the employee enroll in a HDHP, or High Deductible Health Plan. The high deductible health plan is a health insurance plan with a high deductible, (at least $1,100 for an individual and at least $2,200 for individual and family), which is basically what you have to spend out of pocket before the insurance kicks in.

Luckily, the health savings account can aid in paying for that deductible. The high deductible health plan does have its perks; the monthly premium is much lower than other insurance plans. Also, depending on the high deductible health plan you enroll with, you may be able to choose between in network providers or out of network providers. The difference between the two is in network providers are physicians that accept you health insurance plan. This is ideal, as physicians generally don’t care where the money comes from, as long as they receive it. Even so, on average the in network providers will be cheaper than the out of network providers. Keep in mind, however, that if you have Medicare you are unfortunately not able to qualify for the health savings account. Copays are not included in the costs that health savings accounts cover. These can also be called preventive care services.