Where to Find Affordable High-Deductible Health Insurance

Health insurance is one of the biggest expenses in many people's budgets, but going without coverage can be far more costly. In order to reduce the amount paid in premiums, many people look for low-cost health insurance with a high deductible. The higher the deductible, the lower the insurance price.

Preliminaries

• Before you start your quest for the lowest price for high-deductible health insurance, decide exactly what you want. Calculate the deductible amount you consider affordable. If you're combining your plan with a health savings account (HSA), make sure that amount is within the required limitations. Also, decide if you want a plan that requires you to see specific doctors, known as preferred providers. Often these plans, preferred provider organization plans (PPOs) and point-of-service plans (POS), are less expensive. Check for catastrophic health insurance--it's another name for high-deductible plans.

Time Frame

• Not all high-deductible plans are long-term ones. Some very inexpensive plans are short-term health insurance plans that last a year or less and are not renewable more than once or twice, if at all. If you develop an illness or condition while on the plan, you lose coverage at the end of the term and have no health insurance. New plans may not accept you, since you're already ill.

Geography

• Companies price their products according to their experiences with claims. A high-deductible plan recommended for its low cost by someone in one state may be far more expensive than a plan from another company in a different state or region. The same holds true for age and sex. Don't simply take the word of a friend, compare the prices.

Considerations

• Look for high-deductible plans with carry-over options. Insurance companies know that your budget doesn't simply renew because a calendar year started. Some plans allow a rollover to fulfill the deductible. This means the companies allow you to use the medical expenditures from the last three months of the year toward the following year's deductible.

Expert Insight

• High-deductible plans offer tremendous savings, but become costly if you have substantial medical bills. When using high-deductible plans, make certain you open a HSA at the same time, even though you might be tempted to skip it because of a tight budget. The money you put in a HSA is tax-deductible, grows tax-free and transfers to the following year, if you don't use it. If you put as little as $50 a month into the savings account, you'll soon accrue a substantial amount toward your deductible, which will be a significant benefit if you incur a major medical expense.