Pros and Cons of a High Deductible
Comparing health insurance plans can be challenging. There are many variables to consider including coverage, co-pays and co-insurance rates. A basic consideration is whether to pay higher monthly premiums for a policy with a lower deductible or lower monthly rates for a high deductible policy.
In the insurance world a deductible is the amount that individuals must pay out of their own pockets before insurance begins to pay all or part of their healthcare costs. A policy is considered a high deductible plan if the deductible is at least $1,250 for an individual or $2500 for a family. An article in the journal Health Affairs notes that in 2013 one-third of US workers had high-deductible health plans and that the number is expected to rise. High-deductible plans are sometimes known as catastrophic plans. With such plans, people cover the majority of their own health expenses, but if they experience potentially catastrophic health events, such as accidents or serious illnesses like addiction to Clonazepam, insurance will protect them and keep medical emergencies from also becoming financial emergencies.
The question of whether a high-deductible plan is a good fit for a given individual or family depends on factors that are ultimately unknowable. No one plans for an accident or serious illness, and no one can fully predict the future and the medical care that may be needed. There are general guidelines, however, that can help people make informed choices.
Benefits of High-Deductible Insurance Policies
Benefits of high-deductible policies include the following:
- Monthly premiums are lower – The most basic and obvious benefit of a high-deductible policy is that premiums are less than low-deductible plans. There is generally an inverse relationship between the cost of premiums and the amount of the deductible. This pattern is true for policies available to purchase through Marketplaces under the Affordable Care Act, which are categorized as bronze, silver, gold or platinum. A 2013 CNN report notes that bronze policies, with the lowest monthly rates, may have deductibles of $5,000 or more. Silver plans may have $2,000 deductibles.
- If policyholders don’t utilize many health services during the year, they will save money with a high-deductible plan – Healthy people with few healthcare costs are those that come out ahead with lower premiums and higher deductibles. For this reason the plans tend to be attractive options for younger, healthier individuals.
- High-deductible plans can be paired with Health Savings Accounts (HSAs) – Health Savings Accounts are tax-free personal savings accounts that can be used to pay healthcare costs. Unused funds roll over from year to year, and even if employers contribute to the plans, they belong to the employees. HSAs can be used for a wide variety of healthcare expenses and services even if the services, such as chiropractic care or acupuncture, are not covered by a policyholder’s insurance. HSAs can be used to cover treatment for alcoholism and drug addiction to drugs like Clonazepam. For 2014 individuals are allowed to contribute $3,300 to a health savings account associated with an individual high-deductible policy and $6,550 for an account associated with a family policy.
The Downside of High-Deductible Health Insurance Plans
High-Deductible plans are not the right choice in every situation. Some of the downsides include the following:
- Holders of high-deductible policies will owe a significant amount in the event of a medical emergency. Many people prefer to pay a larger premium every month than to risk having to pay a large medical bill in full.
- People with high healthcare needs may get more for their money with low-deductible plans. The plans often offer more comprehensive coverage than high-deductible plans do.
- The desire to save money may lead people with high-deductible plans to forego needed medical care. The Health Affairs article reports on a two-year study of individuals enrolled in high-deductible health plans. The study found that plan members of low socioeconomic status saw a reduction in high-severity emergency room visits over the two years and that hospitalizations declined in the first year but rose in the second. The authors hypothesize that the reduced number of emergency room visits may have increased the need for later hospitalizations.
It is important when comparing plans to realize that they differ on coverage after the deductible is reached. Some cover future costs at 100% while others cover a smaller percentage. It is also important to compare out-of-pocket maximums. HealthCare.gov notes that for 2014 Marketplace plans have an out-of-pocket limit of $6,350 for an individual plan and $12,700 for family coverage. The limit includes coinsurance, co-pays and deductibles but does not have to cover premiums or extra charges for out-of-network providers.
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If you are looking for quality addiction treatment for yourself or a loved one who may struggle with Clonazepam addiction, we can help you find it. Call our toll-free helpline, available 24 hours a day, and let us answer your questions. We can also check your insurance coverage, at no cost or obligation. Call now, and let us help you find your path to recovery.