QHDHP's, or qualified high deductible health plans, are a type of insurance plan that has a higher-than-average medical deductible and costs significantly less than a traditional health plan.
What does "qualified" mean?
Qualified means that the health plan can be used with a health savings account (HSA's) to lower your tax liability each year.
There two main reasons why QHDHP's cost so much less;
- They come with higher-than-average medical deductibles. This means that you will have a deductible between $ 1,200 and $ 5,000 per year if your plan only covers you. If two or more people are covered on your plan, the deductible options range from $ 2,400 to $ 11,900 per year. The higher the deductible you choose, the more affordable the plan is.
- They are "deductible-first" plans. This means that they cover your medical expenses after you've paid your deductible for the year. The exception to this rule is that they pay 100% of your preventive care before you're required to pay toward your deductible.
Where can I get a QHDHP?
QHDHP's are available in the private market to individuals, families, and self-employed individuals who do not have access to health insurance through an employer. They are also available to employers wanting to provide affordable coverage options to their employees. A health insurance agent in your local area can help you sort through the options available to you.
Pricing for QHDHP's varies depending on the state in which you live, the insurance company and plan deductible you choose, and what percentage of medical expenses your plan covers after you've met the deductible.
As a health insurance agent, I've personally seen families lower their health insurance premium by $ 200 – $ 500 per month, which equates to between $ 2,400 and $ 6,000 in savings per year!
A money-saving health plan package
QHDHP's are a popular and effective solution to high health insurance costs. They allow you the opportunity to save a large portion of your premium if you remain healthy during the year (as opposed to giving it to the insurance company whether you remain healthy or not). Also, if you do need medical care, the combination of QHDHP's and HSA's allows you to pay for your medical expenses with pre-tax dollars.
Health savings accounts make QHDHP's even more attractive
Because QHDHP's are qualified to be used health savings accounts (HSA's), you can reap significant tax benefits in addition to your monthly savings. Any qualified medical expenses you or your family have can be paid with pre-tax money, increasing your savings each year!