Guides

High Deductible Health Plans and Health Savings Accounts

A High Deductible Health Plan (HDHP) is an insurance plan with a higher deductible and a lower premium. In these plans, you often pay less monthly but must pay more before your insurance starts to help out. HDHPs are often coupled with a Health Savings Account (HSA). Health Savings Accounts or HSAs are medical accounts where you can save money for medical expenses without the money being subject to federal income tax. Combining your HSA and HDHP can be beneficial as you can continue to save money in your HSA tax-free and use that money to help pay the higher deductible required of an HDHP. Although HDHP and HSA plans can usually be coupled, this is not always the case. When shopping for your HDHP on either the federal or your state marketplace, make sure your chosen HDHP plan is labeled as HSA qualified. Picking an HSA-qualified plan is not the only requirement to qualify for a Health Savings Account. To qualify, you also cannot be listed as a dependent on someone's tax returns and cannot be a part of a Medicare or Tricare program. High Deductible Health Plans and Health Savings Accounts are popular options despite these requirements.