The Pros and Cons of High Deductible Health Insurance

With the numerous terms in a health insurance policy, it can easily be confusing.  One of the most asked about is the deductible.  In this article, let's look deeper into the definition.  Let's also look into the advantages and disadvantages of a high deductible health insurance.

What is a deductible?

A deductible is the amount of money you pay before the insurer starts to pay.  Think of it as your end of the deal.  For every expense, you first pay your part before the insurance company comes in to pay the rest of the bill. Let's look at the following example.

Your policy dictates a deductible of $500.  If you have a medical procedure that costs $1,000, you pay for the first $500.  The remaining $500 is then paid by your insurance company.  If the entire bill is $500 or less, then you will pay for the whole amount.  Your insurer will not have to pay for anything.

One aspect that you should take note of is the fact that the higher the deductible, the lower you insurance premium.  The reverse is also true, in general the lower your deductible means higher premiums.  

Advantage of high deductible plans

The biggest advantage is having lower premiums.  It is possible that you do not have reimbursements every year.  Since you're premiums are lower, you can end up saving more money.  This is advisable for people who are generally healthy and hardly visit the doctor.  However, it is also advisable to always set aside some money in case, since you will be spending more out-of-pocket if you do have a medical procedure.

Disadvantage of high deductible plans

It is possible that most of the time, you will need to fully pay for your check-ups, medicines, emergency room visits, and more.  This is because the amount for each visit does not meet the deductible amount you have set.  This will also include cost of surgeries and other procedures.  This is not recommended if you have a pre-existing condition that warrants frequent visits to a doctor.  If you are considering a pregnancy, or even getting higher in age, this is also not a good choice.

Conclusion

Choosing between a high deductible plan against a traditional policy heavily depends on your condition.  For young and healthy individuals, it can be more affordable to choose a high deductible plan.  For others, it may be wiser to choose a more traditional policy.  Another consideration would be your employment.  If your employment will cover most or all of your insurance, a traditional policy would help you save.  Know more about this by talking to your insurance agent.  

At Roper Insurance Services, we put our clients first by offering them policies that they can afford. Learn more about our products and services by calling our agency at (828) 697-6709. You can also request for a free quote by clicking here.