Do I Need a Low or High Deductible Healthcare Plan?
What if you could save plenty of money with a simple decision?
Choosing between a low deductible vs. high deductible healthcare plan is a big decision. The choice is that much harder because the average person knows very little about healthcare and how these choices affect the overall cost of health insurance.
Are you better off getting a low deductible health plan? Or is a high deductible good for saving money? Keep reading to discover the answers.
Understanding the Basics of Health Insurance Deductibles
If you’re reading this, you’re likely driven by a simple question: What is a good deductible for health insurance? Unfortunately, that simple question isn’t easy to answer because different plans work better for different people based on factors ranging from financial status to overall health priorities.
Fortunately, figuring out what’s best for you is easier than you might think. It all starts with finding the right balance between premiums and healthcare deductibles, which brings you one step closer to choosing the right California health plan.
The Balance Between Premiums and Deductibles
With health insurance, the deductible determines how much you will have to pay out of pocket before your carrier covers the rest. Because of this, many people want a lower one so they aren’t stuck paying too much out of pocket. However, that comes at a price (quite literally) because it leads to a higher premium.
That works in reverse as well; you can lower your premium by raising your deductible. Ultimately, you’ll need to figure out the proper balance between how much you want to pay each month and how much you can afford out of pocket on a sudden healthcare claim. No matter your choice, investing in insurance is an important part of ensuring your physical and financial well-being.
Weighing Your Options: High vs. Low Deductible Plans
While healthcare can get complicated, some things stay pretty simple. As outlined above, you need to decide whether you want a high deductible plan or a lower one.
Each has benefits and drawbacks, and each has different real-life scenarios in which it would be most effective. Read on before you invest in a comprehensive health insurance plan in California.
The Allure of High Deductible Health Plans (HDHP)
The primary benefit of having a high deductible health plan (HDHP) is that you will have a lower premium. Additionally, certain HDHPs make you eligible to put untaxed funds into a health savings account (HSA) that you can use to either pay for medical bills or grow as an investment. Finally, if you get your HDHP through your employer, they may also make contributions toward your HSA.
Considering the Certainty of Low Deductible Health Plans (LDHP)
The primary benefit of having a low deductible health plan (LHDP) is that your deductible will, by definition, be lower on claims. This type of coverage is ideal for anyone who plans to make multiple claims throughout the year. That typically applies to the elderly, pregnant women, or anyone with a chronic health condition. Such plans may also be ideal for those with children who will need medical care throughout the year.

Real-Life Scenarios: When HDHP or LDHP Fits Best
Certain real-life scenarios can help you decide between an HDHP and an LDHP. For example, if you know you’re getting surgery this year, a lower deductible is best. It’s also the best choice for anyone on expensive medication or whose children play sports.
In general, HDHPs are best for those who rarely go to the doctor and those who are financially secure enough to afford an expensive, out-of-pocket cost. As outlined above, it’s also best for those putting money into an HSA, especially if an employer is matching some of your contributions.
Evaluating Health Needs and Risk Factors
HDHPs are fine for those who are relatively healthy. How do you know if that’s you? Simply put, if you very rarely go to the doctor, you likely don’t need a low deductible. Should that change over time, you can always switch to a different plan during open enrollment, whether that’s through your employer or the government. Open enrollment typically occurs from the beginning of November through December, so Thanksgiving is the perfect time to make your choices.
It’s also important to take family histories into account. This will let you know your risk factors for developing a variety of health issues. If you know you are at high risk for one or more major conditions, you may want to go ahead and get an LDHP.
Assessing Your Financial Readiness
For the most part, HDHPs are best for those who can afford a sudden out-of-pocket expense. Only you can decide if you are financially ready for such expenses, but you should probably skip an HDHP if you don’t have much in the way of savings or often feel like you are living month-to-month. Conversely, if you feel financially secure and don’t anticipate too many trips to the doctor, an HDHP is a great way to save on your monthly premiums.
Explore Your High and Low Deductible Healthcare Options
This guide provides everything you need to know about low deductible vs. high deductible healthcare plans. You now know about the relationship between your premium and your deductible and how making a change can lead to dramatic savings. Just as importantly, you know how to determine which plan is best and which can help you get the best rates from your carrier.
Cost-U-Less Insurance is here to help you with all your health coverage needs. We’ll help you navigate the confusing maze of healthcare options. To get the healthcare you deserve, call us at (800) 390-4071 or get a fast health insurance quote online. You can also find a Cost-U-Less office near you.