A High Deductible Health Plan Lowers Your Healthcare Costs and Ensures Coverage for Preventive Care

 

Original Content- Business Upside 

Those familiar with insurance policies should be aware of deductibles in relation to the premium paid. Insurance companies focus on deductibles to calculate the premium payable on any policy. Those who choose a high deductible health plan usually have to pay a lower premium for their health insurance policy. A high deductible means a four-figure sum against which the policyholders can choose plans that provide full coverage for preventive care. It means that such health insurance plans relieve the policyholders from coinsurance and copays.

High Deductible Health Plan (HDHP)  – An Explanation

Before understanding what is considered a high deductible health plan, it is essential to understand what a deductible is. For individual taxpayers or businesses, the deductible is an expense that qualifies for subtraction from adjusted gross income when calculating the tax during filling of a tax form. By taking advantage of deductibles, taxpayers can lower their tax liability due to the reduction of taxable income. It results in lower income taxes for businesses and individuals.

For an individual choosing a health insurance plan with a high deductible, it means that during a claim, the insured must pay their own share or out-of-pocket expenses first to activate the policy coverage. The insurance company is responsible for paying the balance amount as stipulated in the contract.

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