{"id":801,"date":"2023-05-02T17:43:00","date_gmt":"2023-05-02T17:43:00","guid":{"rendered":"https:\/\/www.freeway.com\/knowledge-center\/?p=801"},"modified":"2023-12-11T14:11:12","modified_gmt":"2023-12-11T14:11:12","slug":"high-deductibles-pros-cons","status":"publish","type":"post","link":"https:\/\/www.freeway.com\/knowledge-center\/health-insurance\/high-deductibles-pros-cons\/","title":{"rendered":"High Deductibles: Pros and Cons"},"content":{"rendered":"\n

For families living on a budget, every necessary expense seems like a lot. And even though insurance is a necessity, it can still feel like a burden. Whether it\u2019s car insurance<\/a>, health insurance<\/a>, home insurance \u2013 or any kind of insurance \u2013 most people are always looking for ways to save on their policies.<\/p>\n\n\n\n

If this sounds like you and your family, you are not alone. If you are looking for a lower monthly payment, you may wind up with a high deductible plan. The popularity of high deductible health plans is they give you the cheapest rate possible and keep you covered, while not emptying your bank account at the same time. But is a high deductible plan a good thing?<\/p>\n\n\n\n

Understanding the differences between plans, deductibles, out-of-pocket costs and more can be confusing. Everyone knows there are health benefits to picking the right policy. To help you navigate these options and pick the best one for your family, here are some pros and cons about high deductible plans.<\/p>\n\n\n\n

Pros of High Deductibles<\/strong><\/p>\n\n\n\n

High deductibles are a good option for a single person and families who in good health, don\u2019t have chronic conditions and don\u2019t go to the emergency room very often. Also known as high-deductible health plans (HDHPs), they help people with cost savings as long as they don\u2019t need doctor visits very often.<\/p>\n\n\n\n

Just because these plans are cheaper with a low monthly premium compared to ones with higher premiums, it doesn\u2019t mean they completely skimp on coverage. There is the same amount of coverage to make sure you can see doctors, get medicine, seek mental health treatment, get prescription drugs and visit a specialist (if needed). Your out-of-pocket expenses will just be higher.<\/p>\n\n\n\n

Cons of High Deductibles<\/strong><\/p>\n\n\n\n

The single biggest challenge you\u2019ll face with HDHPs is paying out-of-pocket costs for qualified medical expenses. With auto insurance, it can represent a huge, ongoing financial drain if you have to use it often, underscored by the fact that you\u2019ll still be responsible for monthly payments.<\/p>\n\n\n\n

Young people without preexisting health conditions, for example, benefit from cost-effective health insurance with high deductibles. However, families with young children have a good chance of seeing the possible downside of how family members can have negative impacts on your healthcare costs. The worst-case scenario, at least in the short term, is electing to have a HDHP and then have someone in the family develop an expensive, long-term or chronic illness, of course.<\/p>\n\n\n\n

At least with a HDHP, once you meet your deductible, you won\u2019t have to pay it again until the upcoming year begins a new 12-month period. But if you need medical care and you don\u2019t reach your deductible or your out-of-pocket maximum, you\u2019ll find yourself still coughing up cash whenever you need medical care.<\/p>\n\n\n

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Costs of Health Care<\/h2>\n\n\n\n

Your health insurance coverage is typically good for one year. Your choices for health care will depend on whether you are using a private traditional health plan, an employer plan, or a low-cost plan through the Affordable Care Act. In most cases, you\u2019ll have the ability to choose one or another set deductible rate (higher deductible or lower deductible<\/a>), although if you are purchasing your plan privately, you may be able to set your own deductible.<\/p>\n\n\n\n

Let\u2019s brush up on some of the terms you may see on a policy.<\/p>\n\n\n\n